Deloitte Cyprus helped falsify documents to hide Abramovich's assets, BBC Panorama finds

The allegations

The BBC Panorama investigation, produced with the Bureau of Investigative Journalism, says Deloitte's Cyprus unit helped falsify corporate records to hide the wealth of Roman Abramovich and avoid taxes. Superyachts, mansions and private jets worth $672 million disappeared from the accounts of his companies after the Cypriot branch approved the statements. According to the BBC, the branch approved the documents even though it knew the information in them was wrong. The findings also suggest Deloitte advised on a plan to avoid a very large tax on the oligarch's wealth through document falsification. The firm is linked to MeritServus, a company that split from Deloitte in 2005 but stayed closely connected to it, and which managed Abramovich's billions for almost 20 years alongside Demetris Ioannides, formerly head of Deloitte's Cypriot arm.

How the records were changed

The material comes from the Cyprus Confidential leak, which contains more than 500,000 documents. The leak was first passed to the International Consortium of Investigative Journalists before being analysed by The Guardian, the BBC and the Bureau of Investigative Journalism. In 2005, when Abramovich faced a possible tax bill in Cyprus, MeritServus advised adjusting prior-year accounts so that the assets appeared to be located in the British Virgin Islands. In 2006, after a new Cypriot law required luxury assets such as superyachts, villas and private jets to be declared, management of several hundred million dollars' worth of those assets was moved retroactively to the British Virgin Islands. Staff registered the assets there, where the data would not be public, and made it appear the transfer had already happened in 2003. Analysis of the files finds at least 1,000 corporate documents with false timestamps used to alter the historical record, covering offshore dealings from 1999 until at least 2013.

Money moved through Kravin

The files show that Kravin Investments, a Cypriot company through which money from Abramovich's oil dealings flowed, received about $3 billion in May 2003 and kept almost $2 billion of it. Interest on the retained money was in principle taxable in Cyprus, and in 2005 financial advisers discussed restating the 2003 and 2004 accounts. Later contracts presented Kravin as fund administrator for Kelvedon Worldwide, a company registered in the British Virgin Islands. Although those contracts bore 2003 dates, some were created at least two years later, according to the investigation. A separate operation from 2000, linked to Cypriot holdings in the Sibneft oil group, involved backdated consultancy contracts, with payments of $98 million routed through an intermediary that passed 99.9% to Abramovich as a commission.

Responses

Abramovich's lawyers deny that he evaded tax or concealed his wealth. They say the investigation presented no evidence that he knew of, approved or instructed any falsification, and that relying on professional advice is legitimate. His lawyers also deny the criminal allegations linked to Jersey, which they say were brought for political reasons. Andrew Mitchell KC, a barrister specialising in financial services law, told the BBC that the evidence described what he called an obvious tax evasion, one that could not be more blatant. Deloitte Cyprus said it acted in accordance with applicable law.

Frozen assets and open cases

About 5.4 billion pounds of his assets remain frozen on Jersey, where a criminal investigation has run for four years. VRT NWS puts the frozen total at 6.39 billion euros. Abramovich, according to media reports, lives in Turkey, which does not apply sanctions against Russia. British sanctions followed Russia's full-scale invasion of Ukraine in 2022, when he was sanctioned as a associate of President Vladimir Putin and forced to sell Chelsea FC, which he had bought in 2003. The leak analysis names Eugene Tenenbaum, described as Abramovich's closest associate, as apparently involved in the backdating and as possibly having submitted false evidence to the High Court during litigation.