{"id":19824,"date":"2013-03-26T08:22:04","date_gmt":"2013-03-26T08:22:04","guid":{"rendered":"http:\/\/www.taxresearch.org.uk\/Blog\/?p=19824"},"modified":"2013-03-26T08:22:04","modified_gmt":"2013-03-26T08:22:04","slug":"for-those-who-say-there-was-no-russian-money-in-cyprus-the-ft-disagrees","status":"publish","type":"post","link":"https:\/\/www.taxresearch.org.uk\/Blog\/2013\/03\/26\/for-those-who-say-there-was-no-russian-money-in-cyprus-the-ft-disagrees\/","title":{"rendered":"For those who say there was no Russian money in Cyprus, the FT disagrees"},"content":{"rendered":"

I had a twitter debate with Frances Coppola over\u00a0the\u00a0weekend in\u00a0which\u00a0she claimed first that Cyprus was not a tax haven as there was no evidence of illegality,\u00a0second\u00a0that\u00a0Russian\u00a0money had not caused the crisis, \u00a0third that Greece had\u00a0precipitated\u00a0the fall (which\u00a0is only true in\u00a0the\u00a0sense of it being a tipping\u00a0point) and fourth the\u00a0Russian\u00a0money, if it\u00a0had\u00a0been\u00a0there, was all gone now.<\/p>\n

All\u00a0those\u00a0claims are wrong. But let's just deal with the last as it gives a lie to the rest. The FT says this morning<\/a>:<\/p>\n

With most banks in\u00a0Cyprus<\/a>\u00a0due to reopen on Thursday, the island\u2019s many Russian depositors are scheming ways to beat the looming limits on withdrawals and money transfers designed to stem a run on the banks.<\/p>\n

A majority of the deposits of more than \u00e2\u201a\u00ac100,000 at the Bank of Cyprus and Laiki Bank are ultimately owned by Russian beneficiaries<\/strong>, a person close to one of the lenders told the Financial Times \u2014 meaning that Russian businesses and individual depositors will be paying the lion\u2019s share of the local bailout.<\/p>\n

While the person said he expected Russian clients of the two lenders to lose \u00e2\u201a\u00ac3.5bn-\u00e2\u201a\u00ac4bn, Eugene Tarzimanov, a banking analyst at Moody\u2019s in Moscow, called that estimate \u201coptimistic\u201d, noting that Moody\u2019s estimates were higher.<\/p><\/blockquote>\n

I added the emphasis and it is key.<\/p>\n

Of course it does not look on the face of it that many of the funds in Cyprus are\u00a0Russian: they're\u00a0hidden\u00a0behind the secrecy of trusts and\u00a0companies\u00a0that places like Cyprus so readily provide to disguise the ownership of funds. Any banker should know that.<\/p>\n

And those funds are still there. Why? Because those trustees and company directors who hide the\u00a0ownership\u00a0of these funds weren't moving it anywhere for their clients: their livelihood depended on it remaining in\u00a0Cyprus\u00a0and that, I am sure, is why it's still there. A tax haven client and their trustee don't always share the same interests. Those who use these place should note that,\u00a0carefully.<\/p>\n","protected":false},"excerpt":{"rendered":"

I had a twitter debate with Frances Coppola over\u00a0the\u00a0weekend in\u00a0which\u00a0she claimed first that Cyprus was not a tax haven as there was no evidence of
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