Russian-Israeli oligarch Roman Abramovich reportedly quickly reorganized his assets in the early days of the war in Ukraine, making his children the beneficiaries of his trust in an apparent attempt to evade international sanctions.
A large cache of files shared anonymously with the Guardian showed how Abramovich – the former owner of English football club Chelsea and once the richest individual in Israel – turned his seven children into billionaires almost overnight in February 2022. .
Sanctions experts told the newspaper, in the report published on Friday, that the financial moves will make it more difficult for countries to punish Abramovich, who is accused of having close ties with the Kremlin, and has something to thank Moscow for much of his wealth. In contrast to international sanctions against Putin's aides, sanctions against oligarchs have largely avoided targeting their families as well.
The Guardian said the assets passed on to the Abramovich children – the youngest of whom is just nine years old – include luxury real estate along with fleets of superyachts, helicopters and super-jets. The report said the 10 offshore trusts in Jersey and Cyprus that were transferred to his children had assets of at least $4 billion, although the total value could be much higher.
The FBI outlined this strategy by Abramovich last year when the agency said he had realigned trust relationships in an effort to prevent the United States from seizing two of his planes.
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Files leaked to The Guardian indicate the effort was far reaching.
The Bermuda-flagged luxury yacht Solaris, owned by Roman Abramovich, cruises near the Aegean seaside resort of Bodrum, Turkey, March 21, 2022. (IHA via AP)
However, sanctions experts acknowledged that although the reorganization of the assets appeared unethical, it did not appear to have violated any laws.
Abramovich's actions appear to allow him to legally say that he does not control the assets of offshore trusts and that he is even prohibited from exercising such control going forward. Abramovich was pictured Tuesday visiting the Western Wall in Jerusalem's Old City, reportedly for his son's bar mitzvah. He has been seen in Israel several times since the Russian invasion of Ukraine last year.
Britain and the European Union have previously imposed sanctions on the oligarch for his alleged support for Russian President Vladimir Putin and Moscow. Canada said last month that it, too, would sanction Abramovich and seize the assets associated with him.
Analysts said the Russian invasion was a personal disaster for Abramovich, wiping out billions in the value of his assets.
According to an updated list of the super-rich released by The Times in May, the sanctions ousted Abramovich from his position as the richest man in Israel, whose fortune is now estimated at $6.9 billion, down from $14.5 billion last year.
Russian Roman Abramovich, center, listens to Turkish President Recep Tayyip Erdogan as Russian and Ukrainian delegations meet for talks in Istanbul, Turkey, Tuesday, March 29, 2022. (Turkish Presidency via Associated Press)
In late March 2022, Abramovich participated in peace talks hosted by Turkey between Russia and Ukraine, which failed to produce meaningful results.
He was granted Israeli citizenship in 2018, though it is not clear how much time he will spend in the country. Controversially, he also holds a Portuguese passport claiming to be a descendant of Sephardic Jews.
Abramovich made a fortune in Russia's oil and aluminum industries after the collapse of the Soviet Union in 1991. In 2005, Russian energy giant Gazprom paid $13 billion for Abramovich's oil company Sibneft, allowing Putin's Kremlin to restore state influence in the lucrative energy industry. .
Agencies contributed to this report.
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