The case of the Kremlin-connected oligarch Suleyman Kerimov is a testimony to the power of the Russian state when it is used to the benefit of its allies in western courts. In 2017-18 Kerimov faced serious allegations of money laundering and other wrongdoing in the French courts. After the introduction of political pressure from Moscow, however, the French legal system started to produce strange results that eventually led to the dismissal of all charges levied against the oligarch. Recently, however, a French judge placed Kerimov back under formal investigation on suspicion of compliance in aggravated tax fraud. The outcome of this new case will indicate the ability of the French legal system to act independently despite pressure from the Russian government.
Suleyman Kerimov, nicknamed the “Russian Gatsby”, is the 21st richest person in Russia with an estimated net worth of 5.4 billion euros, the majority owner in Russia’s biggest gold mining company, Polyus PJSC, and a senator in the Russian Federation Council for the region of Dagestan. Upon landing in Nice for a vacation trip in November 2017, he was arrested by the French police and questioned for two days over alleged tax evasion and money laundering in connection with the purchase of real estate on the French Riviera.
The court in Nice charged him with tax fraud, set bail at 5 million euros, and forced Kerimov to give his passport away and to not leave France. The Ministry of Foreign Affairs of the Russian Federation sent a note to the French authorities, stating that Kerimov should have immunity from prosecution, by virtue of his diplomatic passport (link). According to the French, however, Kerimov did not use it when he flew to Nice. The French Ministry of Foreign Affairs claims that Kerimov’s immunity does not apply to actions not connected to his functions (link).
Two weeks later, prosecutors asked for Kerimov to be placed in custody or for his bail to be increased to 50 million euros. The court in Aix-en-Provence then set the bail to 40 million euros, put restrictions on those, with whom he may communicate, but still allowed him to stay out of custody (link).
In 2018, under provisions of a law passed by congress in 2017, the US treasury department announced sanctions against Russian oligarchs (including Kerimov), companies, and senior government members in retaliation against Moscow’s meddling in 2016 US presidential elections (link). Two months later, Kerimov won in a ruling at a court in the Aix-en-Provence that removed the charges set against him and allowed him the right to leave France. According to Kerimov’s defense team, they persuaded the court that the allegations did not qualify as money laundering, only as tax fraud (link). The prosecutor stated, however, that he is surprised by the ruling and indicated that he will consider an appeal to the highest French court (link).
Due mostly to a lack of understanding about why Kerimov was cleared of charges and based on the statements by the prosecutor’ office, it would appear that the judicial process may have been influenced by diplomatic relations between France and the Russian Federation. About a month before the final ruling, French President Emmanuel Macron visited the Russian President in Moscow (link). There is no substantial evidence for these claims and so far there has been no new information about the potential decision of the prosecutor’s office to appeal. After the acquittal, the Russian Federation Council met Kerimov with an enthusiastic ovation (link).
In March 2019, however, the French judge placed Kerimov back under formal investigation on suspicion of compliance in aggravated tax fraud, evidently after the prosecutor in the southern city of Nice took some additional steps in the court (link). The judge’s move to place Kerimov under formal investigation means that he becomes a formal suspect, but such investigations can be dropped without going to trial (link). Kerimov’s defense team already said that the oligarch considers the new investigation harassment. It can thus be reasonably expected that the story of dropped charges may repeat itself the second time around.
It should also be noted that Kerimov already had had highly controversial involvement in incidences of corruption. In 2012, a report by London’s The Henry Jackson Society, titled “The Shuvalov Affair,” described two major 2004 investments by Russia’s then Deputy Prime Minister Igor Shuvalov that yielded unusually high returns (link). One was a $49.5 million loan made to Alisher Usmanov to help buy a stake in Anglo-Dutch steel company Corus, the other a $17.7 million bet on Gazprom stock via Suleiman Kerimov’s Nafta Moskva.
Many experts continue to see this as a clear-cut form of bribing and money laundering between the oligarch and Putin’s top official. Shuvalov has repeatedly denied that there was anything improper or illegal about his business activities and his relationships with billionaires like Kerimov and Usmanov (link). Despite harsh libel laws, however, neither of the figures involved sued the authors of the report, preferring instead to let the news cycle die and its revelations simply be forgotten.
In April 2016, the Organized Crime and Corruption Reporting Project (OCCRP) wrote about the Panama Papers and how they revealed Sergei Roldugin, the Russian cellist and businessman, as the secret caretaker of Russian President Vladimir Putin’s enormous wealth. OCCRP reported that Roldugin had received large sums of money from Suleiman Kerimov, using opaque financial mechanisms including offshore accounts. In two complex deals with Kerimov companies, Roldugin effectively received the rights to receive 4 billion rubles (US$ 59 million) and US$ 200 million respectively for a payment of just US$ 2 (link).