Nick Shaxson ■ Anonymous UK company owned Viktor Yanukovych’s presidential palace compound
Anonymous UK company owned Viktor Yanukovych’s presidential palace compound
1 March 2014
The private residence of the newly-toppled president of Ukraine, Viktor Yanukovych, has come to be seen as a monument to decadence.[i] When Yanukovych fled, the security personnel around the palace also left, and hundreds of ordinary Ukrainians were, for the first time, able to see the extravagance of the place for themselves. It seems that the shredding of secret documents was taking too long for the fleeing president and his staff, so they chose to dump them in a lake, where they were found by a group of investigative journalists. The documents are now being dried out and published online at www.yanukovychleaks.org.
What’s not so well known is the links between this palace and the UK. Work by the Ukrainian investigative journalist, Sergii Leshchenko and the Ukrainian Anti-Corruption Action Centre has revealed that the palace compound was, until September last year, one-third owned by an anonymous UK shell company and two-thirds owned by an Austrian bank. In other words, the ownership structure of the palace hid the identity of the true owner.
Global Witness worked with the Ukrainian NGO to get this story out in the UK press.
Yesterday, Yanukovych gave a press conference from Russia in which he said that he owns 2.7 hectares of land at Mezhyhirya, including the palace itself, and that he’d bought this for $3.2 million. He said however, that the rest of the land was rented out and didn’t belong to him or to his son.[iii]
Over the last twenty years, Global Witness’ investigations have shown time and time again how corrupt politicians, arms traders and tax evaders can hide their identity and their assets behind anonymous shell companies. It is quick, easy and cheap to create complicated company structures that span multiple countries that make it extremely difficult for anyone to find out who owns a house, or the money in a bank account, or any other valuable asset.
This is why Global Witness is campaigning for an end to anonymous companies. We want countries around the world to create publicly accessible registers of the real living people who ultimately own and control companies and trusts.
The UK has committed to putting the information about the ultimate, ‘beneficial’ owners of British companies in the public domain after a campaign by Global Witness and other groups, including business associations.
The fact that Yanukovich’s palace compound was in part owned by an anonymous British company is a near perfect, topical example of why this is so important. Had this already been in place, the people behind the UK company would have had to reveal who was the true owners. Similarly, the EU is in the process of trying to clamp down on anonymous companies. It should match what the UK has promised to do and require all European governments to put the ultimate owners of companies and trusts in the public domain.
Yesterday, the Austrian and Liechtenstein authorities announced that they will block any assets that may have been hidden by Yanukovych.[iv] The UK should do the same, if there are grounds to do so.
For the full evidence chain, see the Global Witness report here.
Beneficial ownership verification: exploring Belgium’s sophisticated system
A tide-turning moment in the global struggle for tax justice
Call for papers: Human rights and the 4 “Rs” of tax justice – Tax Justice Network annual conference
Some things never change: the use of Swiss banks by crooks
New study and tool for assessing risks of illicit financial flows in Latin America
Vulnerability and exposure to illicit financial flows risk in Latin America
28 January 2021