Cyprus Invites Foreign Experts on Russian Sanction Evasion Inquiry

The president of Cyprus said Monday he asked an unnamed “third country” to send a team of experts to help the inquiry on how Cypriot financial service providers helped Russian oligarchs skirt international sanctions.

In an interview with the Associated Press(AP), Nikos Christodoulides said he wants “absolutely no shadows” cast over the European Union member country because any adverse publicity would hurt efforts to attract “quality” foreign investment.

The president said “many” probes into alleged sanctions evasion are currently running but wouldn’t give details.

His request was accepted, and the foreign experts will assist a team of seven police investigators in sifting through old and new media reports alleging that Cyprus-based lawyers and accountants shifted Russian oligarchs’ money through a murky network of companies and trusts in order to avoid their seizure in line with sanctions related to Russia’s war in Ukraine.

AP reports that the latest allegations came in several stories published by the International Consortium of Investigative Journalists last week. They cited leaked documents claiming to show how some Cypriot firms helped Russian oligarchs move their money around to evade sanctions.

Christodoulides said the foreign experts would assist their counterparts in how to better conduct their investigations while expediting the process to show that “Cyprus has zero tolerance for corruption” and bolster the sense domestically that justice is being done.

“Our aim is exactly so that there are neither insinuations or any shadows cast over our country’s name,” he told AP.

Russia sanctions evasion tarnished Cyprus

He said a cornerstone of his drive to rid the island of its ill-gotten reputation is setting up a Single Supervisory Authority, an independent body of financial crime experts tasked with cracking down on any financial malfeasance or sanctions evasion.

A draft law has been readied for parliamentary debate and approval.

Christodoulides also said more experts with a legal or accounting background will be hired to strengthen the police’s financial crimes unit.

In the AP interview, he defended Cyprus’ track record in efforts to get its banking sector in order since 2013, when the country needed a multibillion-euro bailout from its EU partners and the International Monetary Fund to weather a financial crisis that brought it to the brink of bankruptcy.

At the time, nearly a third of the country’s 68 billion euros in deposits — more than triple the entire economy — was held by Russians, feeding the perception that Cyprus was Moscow’s financial lackey.

Christodoulides conceded it would take time for Cyprus to rebrand itself as a prime investment opportunity.

“For me, whichever allegation, either big or small, is an allegation against our country, which I cannot accept because it negatively affects our ability to attract private investment,” Christodoulides said.

He added that countries from “the wider Middle East” have shown interest in investing in Cyprus in the fields of energy, health services, education and information technology.