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Almost one in ten cases of trade-based money laundering from Russia over the past ten years has involved companies from the UK, according to a recent study by Transparency International-Russia.
The study says that at least 20 billion roubles (close to $110.8 million as of December 18, 2023) — or about 10% of the total volume of illegal money transfers through trade from Russia — were withdrawn through these types of operations.
In many cases, the goods were delivered at a false value or under the guise of other goods. The goods were not sometimes delivered at all and were accompanied by false documents.
The operations involved shell companies so information about the ultimate beneficiary is unknown, according to Transparency International. The criminals regularly relied on Scottish Limited Partnerships (SLPs), to launder money, while some “UK legal entities involved in [trade-based money laundering] schemes, including LLPs and LPs, changed their names and continued to operate.”
Vlad Netyaev, an analyst with Transparency International-Russia and author of the report, told The Insider that these cases cannot be called a coherent laundromat:
“Our estimate is 250 million pounds sterling, or 25-30 billion Russian roubles. How did we arrive at this figure? We looked at the decisions of Russian courts under Articles 193 and 193.1 of the Criminal Code, which deal with the illegal withdrawal of funds, including the use of false documents. This is a situation where goods are delivered at an inflated price or not delivered at all. We did an analysis of all these decisions, there are about three hundred of them, and thirty of them have the jurisdiction of British intermediaries.
These are various Russian organisations, both small groups of one or two Russian citizens and organised crime groups, including the well-known Samara organised crime group, who have been doing this for quite a long time. This is not a coherent laundromat that has been going on for ten years. These are unconnected stories. What they have in common is that British common law firms, such as SLPs, LLPs and various forms of British companies, are used time and time again to take money out of Russia, which allows the money to be taken out into the accounts of British companies in a rather opaque way and without information about the ultimate beneficiaries.”