Cyprus handed 800-page US dossier on Russia sanctions breaches

Cyprus has received an 800-page dossier from the US government detailing sanctions breaches by local individuals and entities that are alleged to have enabled the Russian billionaire, Alisher Usmanov, to conceal details of his assets.

As the island’s leader Nikos Christodoulides vowed to push ahead with the prosecution of law and audit firms that had aided the oligarch, Washington released documents that amounted to a toolkit to facilitate the process. At least two other dossiers are expected to follow.

Revealing receipt of the “data package” on Tuesday, Christodoulides insisted a new era had begun in the EU member state long known as “Moscow on the Med” due to its financial ties with Russia – and reputation for soft-touch regulations.

“It’s imperative we approach this issue with the appropriate seriousness and do what we can so as not to allow anyone to blacken the country’s name,” he told a key economic forum in Nicosia, the island’s capital. “And I am certain that you who represent our economy realise and share the need to finish up with this matter and move into the new era.”

Christodoulides, who succeeded Nicos Anastasiades as president in February, has spoken with unexpected urgency about the need to crack down on sanctions breaches if Cyprus is to safeguard its credibility as a business hub. In April, more than a dozen Cypriot nationals and legal entities were included in a new round of US and UK sanctions after being identified as “financial fixers” for Usmanov and Roman Abramovich, close allies of Russian president Vladimir Putin.

The Foreign Office acted after publication by the Guardian of the Oligarch files, a series of reports that raised concerns about sanctions enforcement in Cyprus.

According to the British government, Cypriot companies, including a prominent law firm, helped Uzbekistan-born Usmanov, who is on both UK and US sanctions lists, manage ownership of Sutton Place, a 16th-century Tudor manor in Surrey, England. A spokesperson for Usmanov says ownership of the manor was “long ago” transferred to an irrevocable trust and, as stated previously, that he withdrew as a beneficiary of the trust, donating his beneficial rights to family members.

The allegations have been deeply embarrassing for the new government in Cyprus with well-placed sources speaking of panic in the war-divided island’s financial services sector. In recent weeks hundreds of firms have allegedly rushed to distance themselves from sanctioned Russians amid media reports that Kremin-linked businesses have also begun to seek sanctuary from possible restrictions in the island’s breakaway Turkish-controlled north.

Unlike the internationally recognised south, the unrecognised mini-state in the north – the by-product of invasion in 1974 following a coup aimed at forging a union with Greece – is outside EU jurisdiction.

“It had been suspected that Christodoulides was pro-Russian,” said Costa Constanti, a Nicosia-based analyst. “But he appears to be proving his critics wrong. What we are finally seeing is a new leader trying to rebrand Cyprus as a clean and safe investor destination after a decade of questionable financial dealings.”