Swiss Bankers Charged With Overlooking Millions Tied to Putin’s Friend

Four bankers went on trial in Zurich on Wednesday charged with helping to cover up the movement of tens of millions of Swiss francs through accounts opened in the name of a Russian musician with close links to President Vladimir V. Putin of Russia.

The case focuses on two bank accounts in the name of Sergei P. Roldugin, a concert cellist and director of a Moscow musical academy who is known as an old friend of Mr. Putin’s and as a godfather to the president’s eldest daughter. The accounts were opened in the Swiss unit of Gazprombank, a prominent lender in Russia.

The trial raises wider questions about the role of Swiss banks as the destination of choice for billions of dollars of deposits linked to Russian officials, oligarchs and ultimately to Mr. Putin, especially in the wake of Russia’s invasion of Ukraine last year.

Swiss prosecutors say that the four defendants, who include Gazprombank’s chief executive and three other employees at the bank, were criminally negligent in failing to perform robust due diligence to determine the real beneficiary of the assets flowing through the accounts. The bankers, three Russians and a Swiss, deny the charge.

The prosecutors contend the bankers should have suspected Mr. Roldugin was not the beneficial owner of these assets but only, as the indictment suggests, a “straw man” or “wallet” for Mr. Putin.

The State of the War

“It is well known,” the indictment said, “that Russian President Putin officially only has an income of 100,000 Swiss francs, and is not wealthy, but in fact has enormous assets which are managed by persons close to him.”

Prosecutors also drew attention to companies set up in Mr. Roldugin’s name by Bank Rossiya, an institution whose chairman, the billionaire financier Yuri Kovalchuk, they said, “is considered Mr. Putin’s treasurer.”

Mr. Roldugin has acknowledged he is not a businessman. He said in a 2014 interview that “I don’t have millions,” yet the accounts opened with Gazprombank credited him with holding assets of over $50 million and receiving over $8 million a year, the indictment said.

In an interview on Russian television in 2016, Mr. Roldugin said his so-called wealth consisted mainly of donations from rich businessmen to finance the purchase of expensive musical instruments for Russian musicians.

Gazprombank opened the accounts in 2014, after Russia had annexed Crimea, and continued managing them until 2016. Their existence came to light in the Panama Papers leak in 2016 that released more than 11 million documents with financial details of over 214,000 offshore business entities.

Switzerland’s financial market regulator, Finma, started an investigation soon after the leak, leading eventually to the criminal charges filed by prosecutors against Gazprombank.

Switzerland has taken steps to clean up its reputation as a haven for dirty money and Wednesday’s one-day trial attracted interest as evidence of Swiss authorities holding bankers to account. It has also drawn criticism, however, for the leniency of the penalties sought by prosecutors. They asked for a suspended sentence of seven months, with two years probation, for each defendant.

“That’s absurd if you want to change the environment for bankers laundering money for Russian officials —,” William F. Browder, the Britain-based financier and campaigner against corruption in Russia, said in a phone interview. “They should face custodial sentences, not a slap on the wrist.”

The proceedings provide another example of how “Switzerland wants to be seen to be doing something but doesn’t want to be tough,” said Mr. Browder, once a major investor in Russia who started a campaign for sanctions against corrupt Russian officials after his tax adviser, Sergei Magnitsky, was detained, severely beaten and left to die in prison.

In 2021, Swiss authorities closed a decade-long investigation into a money laundering scandal involving funds siphoned off by Russian officials into Swiss bank accounts, without pressing charges. In January, the authorities decided to returned to Russia more than $14 million of the funds frozen in that investigation and held in accounts in Credit Suisse and UBS.

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