Russian oligarchs have stashed away immense wealth through the secrecy afforded by numerous EU countries, panelists detailed to MEPs on Tuesday.
Addressing MEPs of the subcommittee on tax matters, three experts detailed some of the ways in which Russian oligarchs have hidden abroad assets estimated to account for around half of Russia’s household wealth, some of this being done through EU countries and with the services of EU-based financial intermediaries. The presentations of Professor Susana Peralta, Theresa Neef, and professor Righard Murphy are available here.
Professor Peralta presented the specific case of Portugal, showing how the country had very opaque systems in place, especially regarding its golden visa scheme, citizenship granted to Sephardic Jews, which allowed Roman Abramovich to dubiously obtain Portuguese citizenship in 2021, and the non-taxation of crypto assets. She also outlined how Portugal had only frozen EUR 242 as part of the Russia EU sanctions which it has since unfrozen.
Theresa Neef outlined a proposal for a European Asset Registry which would detail what assets are owned where across all the EU. This registry would centralise information held across the EU and would include all asset types, apply to all jurisdictions and would cover all legal forms (trusts, foundations etc.). Most importantly, this would allow light to be shed on real estate ownership, knowledge of which is currently very poor.
Professor Murphy laid out the ways secrecy creates the right environment for tax avoidance and hiding wealth. This secrecy system is obtained through a combination of secrecy jurisdictions havens, financial intermediaries (lawyers, accountants etc) and networks of secrecy jurisdictions. He particularly underlined the need to make financial intermediaries more accountable and responsible and keep in mind that it is the network of secrecy jurisdictions that allow wealth to go under the radar, not a single jurisdiction on its own.
MEPs focussed their questions on how to make already existing legislation work better and what new tools would be needed at EU level to address the problems. They also asked for more details about how the European Asset Registry could be established and how best to target Russian oligarchs with the next rounds of sanctions.
You can watch the hearing again here.