Punishing Putin: Inside the Global Economic War to Bring Down Russia by Stephanie Baker

Author:Stephanie Baker [Baker, Stephanie]
Language: eng
Format: epub
Published: 2024-09-10T00:00:00+00:00

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When I visited Cyprus in June 2023, I was hoping to talk to Vassiliades myself. He wasn’t answering my emails, and his sandstone office building in Nicosia appeared shut, so I decided to see if he’d retreated to his vineyard. When I got there, I thought I might see some sign that the sanctions were making it hard for him to continue to operate the business. After all, a high-end restaurant he owned in Nicosia had been closed since the sanctions were imposed. Instead, I saw a group of Russian tourists sitting down to a lavish lunch. I asked the young Russian man working behind the cash register if Vassiliades was available, but he told me his boss was in Nicosia. I found his card with his cell phone number on the desk next to bottles of olive oil and jars of honey for sale.

I made my way to the nearby village of Omodos, where his daughter had been married in one of the island’s oldest monasteries and Domaine Vassiliades had its own store selling wine down one narrow lane. Among a smattering of tourists, I sat down to lunch in the cobbled square and pulled out my phone to call Vassiliades, expecting he wouldn’t answer an unknown number. To my surprise, he picked up. I told him I was writing a book about sanctions and wanted to ask about the allegations against him. He sounded agitated and distressed. “I don’t want to talk to you,” he told me gruffly, and hung up. Vassiliades told the Cyprus Times, “We have not offered any assistance or service to any person included in the relevant sanctions lists.” It soon turned out Vassiliades had bigger problems. In July 2023, two men on motorcycles shot at Vassiliades’s house in an upscale neighborhood in Nicosia at around 1:00 a.m. and sped off. No one was injured. A few months later, a court in Moscow issued an arrest warrant for him in absentia in connection with an investigation into 1 billion euros stolen from the Russian bank Promsvyazbank.

Vassiliades was just one of many fixers in Cyprus who had been helping to steer illicit Russian cash for decades. Cyprus had a reputation for washing dirty money going back to the 1990s, when the regime of Serbian leader Slobodan Milosevic evaded United Nations sanctions during the Yugoslav wars by stashing funds in Cypriot banks. The island was uniquely suited to hiding money because of laws that kept ownership of companies secret. A former British colony, Cyprus uses an English common law system, enabling nests of shell companies to seamlessly operate across London and U.K. overseas territories with similar rules, such as the British Virgin Islands. After Cyprus joined the EU in 2004 and adopted the euro as its currency four years later, lawyers, accountants, and bankers became the engine of the local economy and a nexus for corruption. Lax banking regulation meant few questions were asked. Cyprus had the lowest corporate tax rate in the eurozone, at 10 percent.

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