(Ominous music plays.)
Let’s briefly recall the events of August 2014. It was a difficult time. Fighting in Ukraine was in full swing, confrontation with the West was escalating, and we were told that only the unity of Russians around the president and his “spiritual values” would help in this clash of civilizations.
The news at the time: Low-cost airline Dobrolyot suspended flights because of EU sanctions imposed on the company for flying to Crimea; Rosneft president Igor Sechin asked the government for financial assistance for the company, since sanctions had made borrowing difficult; Ukrainian President Petro Poroshenko canceled a visit to Turkey and convened an emergency meeting of the National Security and Defense Council because of the worsening situation in eastern Ukraine.
And let me add one more item from me and the Anti-Corruption Foundation: Russian Deputy Prime Minister Igor Shuvalov is paying 688 million rubles for his London apartment. The taxes on the transaction due to the UK treasury alone amount to 77 million rubles, which is eight times more than Shuvalov’s annual income from public service.
Sound implausible? We can prove it with documents.
The Anti-Corruption Foundation has been looking into Mr. Shuvalov for a long time. In addition to his offshore dealings in general, he became notorious as a “tenant” of ultra-luxury foreign real estate.
From the very beginning, we said that this “rental” arrangement was fictitious, and that Shuvalov was renting a castle in Austria, an apartment in London, and a villa in Dubai from himself.
The deputy prime minister started giving ground little by little. First Dubai disappeared from his disclosures (apparently he sold it), then in an interview with The New Times he admitted to the castle:
Right after that interview, I wrote on the blog, “We’re waiting for the same admission about the apartment in London,” because in a burst of candor Shuvalov said he believed it was right to talk about his assets, since voters are, of course, interested in what he owns.
However, a year and a half has passed since then, and Shuvalov has not acknowledged any new property. Quite the opposite: in his disclosure, he started specifying that the London place was a short-term rental—just 10 years. In a couple of years, he’d supposedly have to move out.
Well then, if Shuvalov does not want to admit it himself, the Anti-Corruption Foundation will do it for him.
In the very center of London, there is this building called Whitehall Court.
The building is very impressive: right on the Thames, five minutes from Westminster, with its own private garden. If you walk past it, you will definitely notice it and stop to stare. From the outside it looks more like a hotel; they say MI6’s main headquarters used to be located there. All in all, it is hard to imagine that people actually live in a building like that—it is just too grand and ostentatious.
And yet Igor Ivanovich Shuvalov’s 500 square meters are located in exactly this building. Here are his windows marked in red:
Since 2003, this apartment had been registered to several different offshore entities. We began this investigation several years ago—drawing complicated charts, trying to prove the connection between these offshore companies and Shuvalov. First there was Central Cove Ltd, managed by Shuvalov’s pet lawyer Alastair Tulloch, the secretary of another acknowledged Shuvalov offshore, Sevenkey Ltd. Later, the owner was listed as Trident Trust, a London trust for managing family assets.
But none of that will be necessary, because less than a year ago Shuvalov simply transferred ownership to a Russian company, SOVA REAL ESTATE.
We did not have to look far to find the owners of Sova Real Estate. According to Russia’s Unified State Register of Legal Entities, the company belongs to the deputy prime minister himself and his wife, Olga.
The Shuvalovs seem to have a special connection with owls—just look at what is depicted above the entrance to their country residence outside Moscow, “Zarechye.” The family crest of a servant of the people.
Now for more detail on “transferred ownership to a Russian LLC.” In fact, the documents show that in 2014 Igor Ivanovich bought this apartment from his own offshore company. For £11.5 million (688 million rubles). This is stated absolutely clearly in the extract from the land registry:
It also says there that the apartment is held on a leasehold from the British Crown until March 25, 2176. There is no need to pay much attention to that: leasehold is the form of ownership used for the vast majority of London apartments. Basically, for a certain sum (the market value of the apartment), the Crown lets you use the apartment for 100 or 999 years; after 999 years, you write a letter, and the next time you need to apply again is another 999 years later. Tradition, sir.
So the Shuvalov family can sleep easy: no one is going to throw them out of the apartment in 2018. And in his disclosure, Shuvalov simply lied. He is renting the apartment from himself. It is just very hard to bring yourself to admit that—not all Russians would understand. But that is precisely what makes this fact significant, and of course it should be disclosed to the citizens of the Russian Federation.
Even if we assume this transaction was just moving money “from one pocket to another,” taxes still have to be paid in the UK on a purchase like this.
On the purchase of an apartment for £11.5 million in the UK, £1.3 million in tax must be paid to the British treasury. At the exchange rate on the date of purchase (August 1, 2014), that was 77,000,000 rubles. Do you know how much the deputy prime minister earned in 2014? 9,232,662 rubles. That is 8 times less than what was needed just to pay the tax on the London apartment, and 76 times less than what was needed to buy the apartment itself.
It would be very interesting to compare that with how much tax the deputy prime minister paid into the Russian treasury last year.
In the public database of Westminster City Council, we also managed to obtain the architectural drawings for Shuvalov’s apartment. As it turned out, there were actually two apartments, and Shuvalov launched a construction project of epic proportions and merged them into one large one (the Russian way!).
We had really hoped to see photographs, but unfortunately the documents contained only black-and-white sketches and plans. It looked something like this.
We did some serious creative work and reconstructed from the drawings what the London apartment of Deputy Prime Minister and patriot Shuvalov looks like in real life.
Nearly 500 square meters of space, 6 bedrooms, a dining hall with two fireplaces, and a living room with a grand piano and a view of the Thames.
For more than 10 years, Shuvalov hid his apartment behind anonymous offshore companies, and now behind a Russian company as well, instead of openly acknowledging that these 500 square meters of elite housing in London belong to him. He misled the Russian and British tax authorities, hired lawyers to manage this asset, set up blind trusts—all to conceal the fact that this particular apartment belongs to the First Deputy Prime Minister of the Russian Federation.
Moreover, we believe that for ethical reasons Shuvalov should bear primary responsibility for such schemes, because he is not just an official, but a man who became famous for statements like these:
In other words, he is one of those Kremlin hangers-on who invent and promote all this lying, hypocritical nonsense about how “citizens should give the shirt off their backs for the party and the government.” Easy enough to preach that, to lead us toward war, and then quietly pay 688 million rubles for an apartment on the territory of the supposed enemy.
To restore some justice, we will file official complaints with: 1) Putin (Shuvalov is his favorite), 2) S. Ivanov—our man “in charge of fighting corruption,” who screeches that everything is fine with government members, 3) Plokhoi, head of the Presidential Directorate for Anti-Corruption Issues, who is supposed to conduct a formal review, and 4) the State Duma, demanding that it consider the matter at a session and assess these facts—they should find it interesting in an election year.
We’ll wait for the replies, read them, and have a laugh.
And you can help us a great deal by spreading this remarkable story of hypocrisy, lies, and corruption. It would do those 84 percent of “Putin supporters” good to know it.
It is a perfect reason for them to think about whether anyone should go to war for this government, what kind of strange “confrontation with the West” this really is, and who exactly is supposed to “tighten their belts.”
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