LONDON—Switzerland will return millions of dollars stolen to sanctioned Russians accused of taking part in one of the The most notorious scams in the worldby court order seen by The Daily Beast.
Swiss authorities have rejected an appeal against a decision to send back stolen loot despite knowing that their criminal investigation had been foiled by a Russian influence operation orchestrated by Notorious Trump Tower lawyer Natalia Veselnitskaya.
Veselnitskaya held secret meetings with an adviser to the Swiss Federal Prosecutor’s Office, who was fired and convicted after it was reported that he had been given luxury holidays in Russia — including a bear hunt — while he was investigating the case. On one such trip, he was joined by Swiss prosecutor Patrick Lamon and attorney general Michael Lauber, who posed for photos with senior Russian officials.
All three Swiss officials were involved in the Magnitsky investigation; a $230 million scam uncovered by Sergei Magnitsky, who was jailed, beaten and left to die in his cell after blowing the whistle on a major tax scam against Hermitage Capital involving to some Russian officials.
Since Magnitsky’s death, Bill Browder, CEO of the Hermitage, has led a global campaign for justice that has been successful in introducing punitive anti-corruption legislation in many countries including including US and UK
Since then, several key players in the scam have been sanctioned under those laws for participating in what many Western governments describe as a major criminal conspiracy. “An organized crime group has engaged in serious corruption through the embezzlement of the equivalent of $230 million in Russian state assets,” according to the British government.
The individuals sanctioned include Olga Stepanova, a high-ranking Moscow tax official who signed the documents related to the scam, and her husband, as well as Dmitry Klyuev, a banker whom the government’s government official. The British government claimed to have planned the whole scam.
All three of them will receive cash that has been frozen in Switzerland by officials who are said to be tracing the stolen money.
Despite the conclusions reached in London and Washington, DC, the Swiss authorities agreed with Moscow’s claim that there was no “criminal organization” running the operation, which means they will not confiscate the full amount traced from the frozen Swiss bank. account for major fraud.
“It will not be possible to determine the existence of a criminal organization, or a gang engaged in all activities,” reads the Order of the Swiss Federal Criminal Court issued on 23 November and seen by The Daily Beast.
Switzerland will return 55% of the frozen funds to the Stepanovs, totaling $5.5 million, and 100% of the frozen funds in Klyuev’s account ($37,673).
They will also return 99% of the funds derived from the account of Denis Katsyv, the son of a Moscow government official who is recruiting Veselnitskaya in her notorious attempt to lobby the Trump campaign back in 2016. At the time, she was in New York as part of another trial related to a similar $230 million scam. Katsyv eventually agreed to pay US$6 million to settle a lawsuit alleging he laundered some of the stolen proceeds through his company Prevezon.
Veselnitskaya was later charged with obstruction of justice when it emerged that she had secretly helped draft a supposedly independent statement from the Russian prosecutor’s office submitted to the court in the Prevezon case.
In contrast, the Swiss were happy to send back $8.1 million to Katsyv.
The dilution of confiscated funds is part of Switzerland’s lax money-laundering regulation that goes against United Nations best practice and reduces the amount that can be seized each time money is seized. illegally transferred to another account.
Mark Pieth, a former member of the G7 Financial Action Task Force on Anti-Money Laundering and head of the division of economic and organized crime at the Swiss Federal Office of Justice, tells how Penalty relief shows the weakness of the Swiss system. “In summary, the main challenge for Swiss prosecutors and courts is that they apply a theory that allows forfeited funds to continuously shrink after each stage of money laundering. Therefore, the Swiss judiciary favors the cunning money launderer, which is beyond the general risks that this country poses!” he told The Daily Beast.
The court also stripped Hermitage of its status as a victim in the case, which meant the company’s voice could no longer be heard in the process, although Swiss officials initially said they had opened an investigation. investigated because of the evidence the Hermitage presented to them.
“Through this decision, Switzerland has really gone to the dark side. At a time when people are getting tough on Russia, the Swiss are going in the other direction,” Browder told The Daily Beast.
