The Irish authorities have frozen €65m held in accounts of which the beneficiary is Mikhail Khodorkovsky, a Russian oligarch and founder of Yukos Oil, who is in prison for tax evasion and fraud in Moscow.
Another €36m held in Irish accounts is also being examined by garda investigators. It is suspected this money also belongs to Khodorkovsky but he may not be the sole beneficiary. Security and financial sources believe the Russian businessman could have used intermediaries to deposit as much as €200m in Irish banks while disguising its true ownership.
The €65m was lodged in deposits of US dollars with the assistance of investment houses based in the Irish Financial Services Centre.
The money was frozen as it was about to be transferred to an offshore account. The security services became aware of it through financial intelligence reports sent to the Garda Bureau of Fraud Investigation.
The intelligence prompted an investigation by the fraud squad, which initially suspected it represented the proceeds of drug trafficking or terrorism due to the large sums of money involved and the nature of the transactions. The discovery that it belonged to Khodorkovsky was a surprise.
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Other European police forces have begun examining bank accounts linked to those in Ireland. Offshore accounts opened in the Channel Islands are being examined by the British authorities, who suspect they may contain the oligarch’s millions.
The Criminal Assets Bureau (CAB), which seizes the proceeds of crime, is handling the case in Ireland. The agency can apply to confiscate property and seize contents of bank accounts at secret High Court hearings. Security sources stressed the money had been frozen rather than seized by the state.
Khodorkovsky was Russia’s richest oligarch when he was arrested by soldiers on a Siberian airstrip in 2003 and accused of tax evasion. He and Platon Lebedev, his business partner, were accused of stealing Yukos oil worth billions of euros and selling it abroad.
Khodorkovsky had made his fortune — once put at more than €10.5 billion by Forbes magazine — from the post-Soviet privatisation of state assets. At the time of his arrest his wealth outstripped that of Roman Abramovich, the oligarch who owns Chelsea Football Club. That changed when Russia filed huge claims for back taxes against Yukos, forcing it into bankruptcy.
The eight-year sentence Khodorkovsky received, and the subsequent takeover of Yukos, were widely regarded as a politically motivated attack by Vladimir Putin, the former Russian president and now prime minister. The oligarch had drawn Putin’s ire by donating to rival parties and trying to sell part of Yukos to a western firm.
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Last December, Khodorkovsky was convicted on a second set of charges and imprisoned until 2017. Lebedev received the same sentence. The convictions were criticised by the international community. The garda inquiry is regarded as politically sensitive as the Khodorkovsky case has become a human rights cause célèbre. A Russian embassy spokesman was unavailable for comment.