In brief
A BBC-led investigation reveals a scheme orchestrated by Roman Abramovich to misrepresent yacht ownership and avoid significant VAT payments, implicating a network of shell companies and legal advisors in potential tax evasion.
In an explosive investigation, the BBC and the Bureau of Investigative Journalism have uncovered a scheme allegedly orchestrated by Russian oligarch Roman Abramovich to dodge millions in taxes through a complex network of yacht leasing operations. This scheme involved presenting Abramovich's luxury yacht fleet as a commercial enterprise to evade value-added tax (VAT) on their purchase and operational costs.The investigation reveals that in December 2011, despite being the owner of the Eclipse superyacht, Abramovich engaged a company based in the British Virgin Islands to charter the yacht while he was spotted enjoying the Caribbean sun aboard it. This raises serious questions about the legitimacy of his tax practices, which lawyers and experts describe as criminal. Documents leaked from the Cypriot firm MeritServus show a web of trust structures and corporations effectively masking Abramovich's direct control over the yachts, enabling him to avoid significant tax obligations. Five luxury yachts traced back to Abramovich, including the notorious Pelorus and Eclipse, were at the center of this operation.Plans to circumvent VAT payments were outlined in a detailed memo from a director at Blue Ocean Yacht Management, which managed these vessels. This internal document acknowledged the inherent risks in creating such a "legitimate" façade, highlighting how all parties involved were aware of the operations’ true nature.Experts in tax law, such as Professor Tommaso Di Tanno and tax consultant Rita de la Feria, assert that these findings showcase clear indications of tax evasion through intentional misrepresentation. Legal representatives for Abramovich, however, insist that their client followed professional legal advice and deny any wrongdoing.Despite two separate legal probes regarding purported unpaid excise duties and tax evasion linked to Abramovich's yacht operations, investigations in both Italy and Cyprus seem to have fizzled, with procedural irregularities becoming apparent. The Cypriot VAT authorities pursued outstanding taxes but were met with a lack of documentary evidence demonstrating the yachts’ commercial use, which ultimately undermined Blue Ocean's claims.This investigation is part of an extensive series called Cyprus Confidential, which delves into the corporate activities of those connected to the Russian regime. Through a concerted effort among investigative journalists, the truth surrounding Abramovich's financial dealings continues to come to light, leaving a troubling portrait of tax avoidance strategies in the world of high-profile finance.
