Friends and family of President of Cyprus profited from Russian chemical factory
The owner of Trump’s Moscow developer manages the Cyprus subsidiary alongside the President’s daughters.
By: Scott Stedman
The President of Cyprus has enriched his friends and family, and business partners from the high profits of a Russian chemical factory that serves the Russian military. President Nicos Anastasiades’s daughters and longtime business partners made substantial profits from the factory based in southern Russia.
Newly obtained financial documents show how President Anastasiades’s closest confidants, made large sums of money from the Bashkir Soda Company. The company produces a large range of items from baking soda and PVC piping for civilian use, to supplying raw materials for the chemical, oil-and-gas industry, and the defense forces of Russia. In 2015, President Vladimir Putin personally congratulated the company on their 70th anniversary saying, “Your company, built during the Great Patriotic War, has rich and glorious history.”
From 2013–2014, a Cyprus based company called Modisanna Limited owned a 31% share in Bashkir. Cyprus has attracted companies from the former USSR because it signed a double tax agreement in the 1980s, which remained in place after the breakdown of the Soviet Union. The current corporate tax rate in Cyprus is 12.5%. While businesses around the world often shift a large portion of their shares to Cyprus to pay minimal taxes, closer inspection of Modisanna Limited revealed connections to the highest part of the Cypriot government.
Public records show that the two directors for the company are Ledra Fiduciaries and Imperium Nominees. According to Open Company Cyprus, Directors “have the power to decide over the activities and conduct of the company. They are involved in all of the decisions concerning the company and have to fulfill certain duties towards the enterprise and its other members.”
Ledra Fiduciaries is controlled and managed by the Cypriot lawyer who owns the Moscow developer that signed a Letter of Intent to build Trump Tower in 2015. Previous reporting has connected the lawyer, Christodoulos Vassiliades, to numerous money laundering schemes around the world. Imperium Nominees is officially affiliated with the law firm of Nicos Anastasiades and the shareholders of the company are Anastasiades’s two daughters and the two Managing Partners at the law firm in the President’s name. He maintains that since becoming President, he has no relationship with the law firm or Imperium Nominees. A source close to the Cyprus government cast doubt this claim. The source said that Anastasiades is seen at the Imperium Tower at least once a week.
Exclusively obtained financial documents from 2013–2014 show the huge sums of money flowing to Modisanna. In 2013 alone, a $71 million dividend was paid out to the two 50% shareholders — shell companies called Caron Trade & Invest Limited and Morello Worldwide Limited. The latter is a company based out of the British Virgin Islands, where uncovering the true identity of the owners is usually unfeasible.
The valuation of a 50% share in Modisanna is difficult to ascertain, though not impossible. “Valuing private companies is tricky, especially when they are in tax-shelter jurisdictions or try to hide their operations. However, given this holding company’s substantial assets, lack of significant liabilities, and history of large dividend payouts, a 50% share is probably worth at least $50 million, possibly as much as $200 million”, according to Alyssa Vance, tech entrepreneur and co-founder of MetaMed Research.
Caron Trade & Invest Limited, however, was liquidated in 2016, immediately after giving up its shares in Modisanna. This liquidation left behind one clue as to who might be the ultimate beneficiary of the company.
Due to the fact that the liquidation was voluntary, people that are authorized to act on behalf of the company are able to pick their liquidator. In this case, the person who was personally picked by the beneficial owners and oversaw the liquidation of up to $200 million, was Christiana Pericleous — one of the Senior Lawyers at Nicos Anastasiades’s law firm. It remains unknown who received the money.
The news of Anastasiades’s daughters and business partners profiting from the Russian chemical factory comes as European Parliament members sharply criticized the President for aiding Vladimir Putin. According to the Cyprus Mail, 17 Members of the European Parliament in a joint letter to President Anastasiades said, “We write to you with grave concern about the role that corrupt Russian government officials are playing in Cyprus in relation to the laundering of massive criminal schemes coming from Russia.” The Cyprus Mail goes on to point out that “ Five years ago, when Cyprus was facing its worst fiscal and banking crisis in its history, euro area members declined to bail out Cypriot banks on the grounds that the banks helped Russian oligarchs launder ill-gotten gains.”
Since that time, relations between Cyprus and Russia have gotten even closer. In 2015, less than a year after Russia annexed Crimea prompting the imposition of sanctions by the US, the EU and others, Cyprus signed a deal with the Russian government to allow the navy to use its ports. A year later, Anastasiades flew to Moscow and met with Putin at the Kremlin, signing a joint action plan and six bilateral agreements.
The newly discovered financial relationship between the closest members of Anastasiades’s inner circle and Russia expand the scope of Cyprus-Russia relations. The inclusion of Vassiliades in this partnership raises questions about the President’s proximity to the high-profile lawyer who has faced scrutiny about his links to money laundering. Vassiliades, the nominal owner of Trump’s Moscow developer, appears to have connections to the very top of the Cypriot and Russian governments.
