The day Russia invaded UkraineVladimir Putin called 37 business leaders from his country to the Kremlin. 

According to the Russian president, it had been necessary for them to incursion and demanded that they “be understanding” of what was happening.

Russia’s stock market had closed with a 33% loss. This wiped out $71 billion of wealth. raft of new sanctions from the United States and the European Union already in effect and more on the way.

It would have been the first time they had to deal with international financial restrictions for many of the oligarchs present. 

Sanctions were not something new for Suleiman Karimov. 

According to documents, the mysterious billionaire, a Ferrari-driving Ferrari driver, and his family went to great lengths in order to safeguard their assets. This effort would have assisted to insulate him during the time he was being held hostage by other Russian elites. sanctioned by the U.S. in 2018 for benefitting from the country’s “malign activity around the globe.”

Leaked financial records give a peek into Kerimov’s financial transactions and how his associates created a web of corporate structures that obscured his enormous wealth. This includes $300 million in wire transfers from a company named after a Swiss tattoo artist, to Kerimov-related companies.

Jonathan Schanzer, a former U.S Treasury official said that “if you’re an Oligarch you are already operating with Shell corporations and carve outs in expectation of this day coming”, 

In collaboration with the International Consortium of Investigative Journalists (ICIJ), NBC News has mined major financial record leaks — including the Pandora Papers and the FinCEN Files — to illustrate the difficulties Western governments will face in enforcing sanctions against Russian oligarchs. 

While rich people around the world use creative tactics to protect their wealth, the documents reveal the exceptional steps Kerimov and his associates have taken in the past and highlight the challenges ahead for authorities seeking to stem the flow of money to Putin’s inner circle. 

Kerimov is lesser known but wealthier than the likes of Roman Abramovich and Oleg Deripaska. He’s worth roughly $14.3 billion, according to the Bloomberg Billionaires Index, making him the 130th richest person in the world. 

Today, much of Kerimov’s wealth is thought to stem from his family’s stake in Polyus — the largest gold producer in Russia. He also has deep political connections. Since 2008, he has served as a senator in Russia’s Federation Council for his native region of Dagestan, in the majority Muslim southeast. 

By turns private — Kerimov rarely gives interviews — and flamboyant, he has been called a “Russian Gatsby” for hosting multi-million-dollar parties at his massive villas on the French Riviera, including one soiree that reportedly featured a performance by Beyoncé. He reportedly owns a $325 million megayacht, and his car collection has included such rarities as a Ferrari Enzo, which he crashed into a tree in Nice in a near-fatal accident in 2006. 

“That flamboyance, the spending — that’s a part of their persona. But it’s also a way to launder money,” Karen Greenaway, a former FBI agent who worked in the bureau’s International Corruption Unit, said, speaking broadly about oligarchs. 

Despite holding diplomatic immunity, Kerimov was arrested in France in 2017 in connection with a tax evasion and money laundering case over the purchase of a nearly $190 million estate in Cap d’Antibes on the French Riviera, an area otherwise known as the Bay of Billionaires. 

The year before, the Panama Papers investigation by ICIJAnd the Organized Crime and Corruption Reporting Project found that Kerimov-linked companies had transferred $200 million To a financial network that is associated with Sergei Roldugin (whom the European Union calls “Putin’s wallet”).

Greenaway stated that Kerimov was the reason why he received a tax verdict against him. “He must really have triggered something in order to get someone to take a look.”

Roldugin denied ever being guilty of any wrongdoing.

Banks are supposed to file “suspicious activity reports” — called SARs — with the U.S. Treasury Department’s Financial Crimes Enforcement Network when a transaction raises certain red flags. Each year FinCEN receives more than one million such reports. These reports are shared with intelligence agencies and law enforcement, which form the basis for investigations into tax evasion, money laundering, and other financial crimes.    

BuzzFeed News obtained leaked financial documents first and shared it with ICIJ & NBC News. They include SARs that detail 12 suspicious wire transfers that occurred through Bank of New York Mellon in 2012 and 2014. 

According to the reports, officials from banks identified wire transfers worth more than $700,000,000 between companies located in Cyprus, Switzerland, Switzerland and the Bahamas.

NBC News was able to connect several companies that were involved in the flagged $700M in transactions with Kerimov and his business associates by cross-referencing their names with documents previously released from the Pandora Papers. 

Graham Barrow (a London-based expert on anti-money laundering) said that it is not normal to set up shell companies such as this. He reviewed several SARs related to Kerimov companies.

Multi-entities are more expensive and take longer to move money through banks. This is against what economic sense would be for normal capital flow.

In one case from 2013, the Bank of New York Mellon, also known as BNY Mellon, reported to  authorities that a company called Fletcher Ventures sent a $100 million wire to a company called LT Trading. The report stated that “internet searches” indicated that LT Trading, a U.K.-based firm, specialized in the “sale of fruits and veggies.” 

Public filings don’t reveal much about LT Trading. But leaked Trident Trust records, which are an offshore service provider in British Virgin Islands, shows that the company actually is a British Virgin Islands registered firm, owned by Nariman Gaddzhiev (Kerimov’s nephew). This was part of a series of financial records that were leaked to NBC News from tax haven-based companies. 

BNY Mellon has not indicated that it reached out to the bank from which the suspicious transactions originated. Experts believe that inaccuracies or incomplete reports from major U.S. banks and international banks can complicate federal investigations into possible financial crime. 

BNY Mellon spokesperson said that while the bank cannot comment on particular suspicious activity reports, it strictly adheres to all applicable laws and “takes responsibility for safeguarding the integrity and financial system worldwide.” 

Trident Trust stated that while it doesn’t discuss clients with the media but said that it works diligently to improve and invest in compliance processes in accordance with regulatory developments in each jurisdiction in which it operates.

Alexander Studhalter (a Swiss man) is at the heart of $700,000,000 in mysterious transfers financier with close ties to Kerimov. 

According to leaked Trident Trust records, billions of dollars were transferred between Kerimov’s families and the shell companies controlled or managed by Studhalter. 

Studhalter stated that a Lucerne tattoo artist was the owner, in one record. The SARs showed Studhalter sent $300 million worth of wires to Kerimov linked companies in 2013, more than any other holding company. One record also listed Gadzhiev as the company’s owner. He is Kerimov’s nephew.

Tamedia, the Swiss media outlet, approached this tattoo artist and asked him questions. 

Gadzhiev is a Swiss citizen and declined to comment.

French authorities charged Studhalter with acting as an intermediary for Kerimov in the purchase of a multimillion dollar villa and three other properties on Kerimov’s behalf. The charges against Studhalter and Kerimov were dropped later. However, the firm that purchased the property paid about $12 million in back taxes. 

Kerimov was represented by a lawyer in France who stated, “After many years of investigation, our client has never been indicted.” 

However, a Nice prosecutor said that the investigation was not over. 

The official stated that he had been cleared of the initial charges against him, but that he was still being charged in the proceeding and would likely be prosecuted if there were new elements.

 In a statement to ICIJ, Studhalter said that he is an “entrepreneur and investor” who worked with Kerimov as a partner “and not as a service provider.” 

Studhalter claimed that “the whole case was just made up” and continues to be falsely reported in media. 

Studhalter claimed that all the French villas were his and Kerimov was only renting one. As evidence, a bank records that Studhalter provided showed Studhalter as the owner and bears the signatures. Tamedia was told by Studhalter that Kerimov and Studhalter’s signatures had been forged. 

Studhalter said also that all his companies were established in compliance with Swiss law. He added that Kerimov and his father own the businesses accounting for the bulk of $700 million worth of wire transfers. This includes the company which listed the tattoo artist’s owner.

Polyus, his company was established in 2015 delisted from the London Stock Exchange during the fallout from Russia’s invasion of Crimea, so Kerimov took measures to insulate his controlling stake in the Russian gold giant, by transferring it to his then-20 year-old son, Said. 

This move was successful. Kerimov was sanctioned by the U.S. in 2018, along with seven other Russian oligarchs, for benefitting “from the Putin regime and play(ing) a key role in advancing Russia’s malign activities,” including the occupation of Crimea and efforts to subvert Western democracies. The Treasury Department stated that Kerimov had been sanctioned in connection with money laundering, and because he was an official within the Russian Federation’s government. 

The designation was not extended to his children or other businesses that were connected to his wealth. The trading in Polyus was unaffected until the London Stock Exchange suspended it in the wake of the invasion in Ukraine.  

Financial Times, April 6, reported that the European Union was considering adding Said to its sanctions list, and within hours Polyus announced that the younger Kerimov had resigned from its board of directors and sold off nearly half of his shares in the company. The move, which saw Said as no longer majority shareholder was meant to protect Polyus against the freezing of his accounts. 

Polyus stated that these decisions were made April 4, just two days after reports about possible sanctions on Said surfaced. 

E.U. According to sanctions, Said was sanctioned by the E.U. on April 8, for “association with a leading person involved in economic sector providing a substantial source of income to the Government of Russia Federation.” announcement. 

Gulnara Kerimova was Kerimov’s eldest child and listed as “ultimate beneficiary owner” for the businesses used to buy the villas in south France at the heart of the French money laundering investigation. This is according to French company records that Radio France obtained and shared with NBC News. 

Kerimov’s daughter and son did not reply to our requests for comment. 

Experts believe that the Polyus changes last week mirror those made by other oligarchs, who have transferred their wealth to avoid possible sanctions. 

They will run if they catch on to the bad actors early enough. This is how it works,” Schanzer said. He’s now the senior vice president for research for Foundation for Defense of Democracies. 

Kerimov, who was involved in the invasion against Ukraine, has received additional sanctions from Canada and the U.K. His assets appear to have escaped unharmed so far. 

His reported megayacht was last spotted near Fiji, according to MarineTraffic, a maritime analytics provider. People familiar with this matter say that French authorities are not taking any action against his vast estate located on France’s Riviera. 

Their shell companies have not been named and their ultimate beneficiaries are obscured. It is therefore extremely difficult to enforce sanctions,” Barrow said, the expert on money laundering.

Experts say that sanctions may also be applied in other ways.  

“These men are going to get shunned. Schanzer stated that they would be expelled from polite company. I think this could be the true punishment. It’s not because they will lose their money. Their money will be more difficult to move.