An IMGlobalWealth.news Report
An investigation by BBC Panorama and the Bureau of Investigative Journalism (TBIJ) alleges that backdated corporate records were used to obscure billions of dollars in assets linked to Russian billionaire Roman Abramovich and reduce tax liabilities in Cyprus.
Published on 12 October, the investigation, conducted with The Guardian and the Organised Crime and Corruption Reporting Project (OCCRP), draws on documents from the Cyprus Confidential leak. TBIJ says its examination identified more than 1,000 records backdated between 1999 and 2013, some by several years.
The reporting centres on Deloitte Cyprus and MeritServus, a corporate services business formerly owned by Deloitte. The investigating organisations allege that staff were involved in preparing or approving documents presenting asset transfers as having occurred years earlier.
“The allegations reported by the investigating organisations have not been established through a judicial determination”
$672 Million in Luxury Assets
In one case, BBC Panorama reported that draft 2003 accounts for Amiscan Investments listed $672 million in property, aircraft and yachts.
According to the BBC, advisers subsequently prepared paperwork portraying these assets as having been transferred earlier to a parent company in the British Virgin Islands (BVI). Deloitte Cyprus signed off accounts in 2006 showing only $75,000 in assets.
$2 Billion Tax Arrangement Questioned
Another case concerns Kravin Investments, a Cypriot company with almost $2 billion in cash in 2003.
The BBC and TBIJ allege that retrospective documents portrayed the money as belonging to a BVI parent, potentially removing Cypriot tax liabilities on interest income.
Andrew Mitchell KC, a financial crime barrister consulted by Panorama, described the arrangement as “straightforward” tax evasion.
The BBC also reported that MeritServus backdated records indicating that more than $10 billion in assets held through Electus Investments in Cyprus had belonged to a similarly named BVI company since 2003.
The $10 billion represents the reported value of assets, not a quantified tax loss.
Abramovich and Deloitte Respond
Abramovich’s lawyers deny that he concealed assets, evaded tax or knew of or authorised falsified documents. They say he was not involved in the companies’ daily operations and was entitled to rely on professional advisers.
Deloitte Cyprus says it “acts in compliance with applicable laws” and cannot assess the specific allegations because the relevant historical correspondence is no longer accessible.
TBIJ reported finding no evidence implicating other Deloitte network firms.
Implications for International Wealth Management
For international wealth managers and advisers, the investigation concerns the documentation of cross-border holdings and beneficial ownership.
The Financial Action Task Force’s 2023 guidance calls for authorities to have access to accurate, up-to-date information identifying companies’ ultimate owners.
The allegations reported by the investigating organisations have not been established through a judicial determination.
