DEUTSCHE BANK GERMANY SAID IT WAS OK BUT DEUTSCHE USA FILED A SAR ON ITS REAL ESTATE SALE to a company they believed was owned by Vitaly Yusufov, the son of the former energy minister under President Vladimir Putin of Russia

Vitaly Yusufov, the son of the former energy minister under President Vladimir V. Putin of Russia

 

https://www.nytimes.com/2019/10/31/business/deutsche-bank-russia-real-estate-deal.html

 

Deutsche Bank was already under federal investigation for helping wealthy Russians launder money when it struck a deal last year to sell a property it co-owned in California.

The $72 million sale of an office complex might not have been notable, except for one thing: The purchaser was linked to the son of a former top Kremlin official.

The German bank was facing multiple money laundering investigations as well as political scrutiny over its ties to President Trump. Against that backdrop, bank executives in the United States raised objections about the proposed transaction, warning that while not illegal, it could further damage the bank’s reputation. Executives in the bank’s Frankfurt headquarters decided to go forward with it anyway.

After the sale went through, Deutsche Bank officials in the United States took the rare step of contacting the federal watchdog that polices financial crimes to report the bank’s own transaction as suspicious, according to three people briefed on the matter who were not authorized to speak publicly.

So-called suspicious activity reports are common — banks file thousands of them a year to flag potentially troubling money transfers and other transactions to the government. But they generally involve activities conducted by banks’ customers or even their customers’ customers, not the banks themselves.

Deutsche Bank recently contacted regulators in the United States and overseas to explain the Menlo Park transaction, the three people said.

An investment fund run by the bank’s asset-management division bought a 50 percent stake in the low-slung office complex on Willow Road in Menlo Park in 2016. (The other half was owned by Embarcadero Capital Partners, a real estate firm.) Deutsche Bank at the time heralded the site’s proximity to Palo Alto and Stanford University as key selling points.

The Deutsche Bank investment fund agreed to sell the office complex to a limited liability company called Willow Project, the people said. Some bank officials worried about the problematic appearance of doing business with a company they believed was owned by Vitaly Yusufov, the son of the former energy minister under President Vladimir V. Putin of Russia.

A committee of Deutsche Bank executives in New York tried to block the transaction, citing the potential damage it could inflict on the bank’s reputation, according to the people. The decision was appealed to Europe, where another committee gave the green light.

Later, bank officials in the United States filed a suspicious activity report about the transaction to the Treasury Department’s Financial Crimes Enforcement Network.

Sebastian Kraemer-Bach, a bank spokesman, said that Deutsche Bank conducted due diligence on the sale and didn’t find any evidence that it would violate anti-money-laundering laws or sanctions.

“As a result, the discussion of whether to move forward with the transaction was focused on reputational considerations,” Mr. Kraemer-Bach said. “In this case, there was a reputational risk attached to either decision — whether to halt the sale or to move forward with it.” He added that the proceeds of the sale went to investors in the Deutsche Bank fund, not to the bank itself.

Deutsche Bank has faced criticism for years for not doing enough to prevent money laundering. In early 2017, federal regulators punished it for a vast Russian money-laundering scheme meant to convert illicit gains into dollars and other widely used currencies. The bank remains under federal criminal investigation for that matter and others, The New York Times has previously reported.

Deutsche Bank’s handling of suspicious activity reports has been a particular source of criticism. In recent years, compliance officers flagged potentially problematic transactions linked to people including Mr. Trump and his son-in-law Jared Kushner. Bank officials in some cases rebuffed the compliance officers’ recommendations to file such reports, The Times previously reported.

Starting in the late 1990s, Deutsche Bank was the only mainstream financial institution consistently willing to lend money to Mr. Trump and his companies. The bank’s relationship with Mr. Trump is under investigation by two congressional committees.

BACKGROUND: Vitaly Yusufov

 

https://rucriminal.info/en/dosje/88

 

Имя: Vitaly
Фамилия : Yusufov
Отчество : Igorevich
Должность : President of Nordic Yards

Biography:

Was born in 1979. In 2000 he graduated from the Moscow State Institute of International Relations (MGIMO) with a degree in International Economics. In 2002 he defended his thesis on “Macroeconomic problems of increasing the competitiveness of Russia”, becoming a candidate of economic sciences.

In 2004-2006 he worked as an assistant to the general director of OOO Gazprom Export

In July 2006, he became the head of the staff of Matthias Warnig, managing director of North European Gas Pipeline Company (NEGPC)

In 2006, he headed the Moscow branch of Nord Stream AG

In 2009, he acquired the German shipyard Nordic Yards

In 2010 he became a co-owner of the telecommunications company “Osnova Telecom”

Source: Lentapedia

 

 

Dossier:

 

In the spring of 2009, the names of Vitaly Yusufov and his father were mentioned in the materials devoted to the German shipyards Wadan Yards. It was reported that Igor Yusufov provided support to the owner of Wadan Yards to the Russian businessman Andrei Burlakov, and Vitaly Yusufov advised the owner of the shipyards in matters of international law. Subsequently, Burlakov argued that Yusufov, Jr. already at this time actually controlled Wadan Yards.

Vedomosti, January 25th, 2011

 

In June 2009, Wadan Yards announced its insolvency. The fate of the shipyards was discussed at the meetings of German Chancellor Angela Merkel and Russian President Dmitry Medvedev, with the head of the Russian state even promised to replace the “bluff” Wadan Yards investors with “quality” ones. A few days after that, it became known about the purchase of shipyards by Gevor IV AG (in the same year it was renamed to Nordic Yards AG). Its executive director was Yusufov, Jr..

Rossiyskaya Gazeta, August 19, 2009

 

In the summer of 2010, it became known that the company owned by Yusuf – LLC “HaykomInvest”. It was registered in May 2010, and as early as June 3, 2010, the company “Basis Telecom” was established. In it, “IKomInvest” was owned by 74.9%, the “Voentelecom” company, which is controlled by the Ministry of Defense of the Russian Federation, was the holder of the blocking stake (25.1%). The task of “Basics Telecom” was the construction of a wireless Internet access network – primarily for the military, although

“on excessive capacity” was supposed and the provision of services to the public. At the same time, Russian Defense Minister Anatoly Serdyukov asked Russian President Medvedev to help allocate the frequencies of the military to the base of Telecom.

Vedomosti, July 29, 2010

 

In 2010, Igor Shchyogolev, head of the Ministry of Communications and Mass Media of the Russian Federation, said that he did not rule out the emergence of new players in the Russian mobile market of the fourth generation (4G), in particular, LTE. In this regard, was called the “Basis Telecom” Vitaly Yusufov. The news about the appearance of unknown structures on the LTE market caused discontent of mobile operators. The Big Three companies wrote indignant letters to the Minister of Communications, the Prime Minister and the President, and

The media started talking about Igor Schegolev’s corruption conspiracy with “The Basis

telecom. ”

Regions.Ru, 09/07/2010

 

In April 2011, Yusufov bought a 19.91% stake in the Bank of Moscow from Andrei Borodin, the banker who left for Britain (Yusufov formally acquired the companies that owned this stake). For the purchase, a loan of $ 1.1 billion was used, previously obtained by Europroject Investments Global Limited from the Bank of Moscow on security of the Nordic Yards, while Borodin claimed that the price of the bank’s shares was understated. In addition, Yusufov was sold shares of several other co-owners

bank, as a result of which the share of the entrepreneur in the Bank of Moscow was about 26 percent. According to some experts, Yusufov intended to resell the acquired shares to VTB Bank, which could not buy them directly because of a conflict with minority shareholders of the Bank of Moscow headed by Borodin.

The Moscow News, 12/04/2011

 

At the same time, the father of businessman Igor Yusufov lost the post of the Russian president’s special representative for international energy cooperation. It was connected in the press with his possible participation in the transaction: instead of negotiating in the interests of the state, the official purchased shares for his son.

BFM.ru, 04/08/2011

 

Maxim Osadchiy, Head of Analytical Department, Project Finance Bank:

 

“The shares acquired by Vitaly Yusufov may be arrested, and the deal is declared illegal if his company actually took out a loan to buy paper from the Bank of Moscow on the security of shipyards, but the initiator of the arrest could have been only some VTB structure. there is still no action, we can assume that Vitaly Yusufov acted in the interests of VTB and ultimately his shares will go to the state bank. ”

alebedev.ru, 04/18/2011

 

In June 2011, the Federal Antimonopoly Service authorized the structures of Yusufov to increase its stake in the Bank of Moscow to 49.9% due to the repurchase of shares from minority shareholders. However, analysts assumed that he would not do this, because even to buy the previous stake he had to borrow money. In July 2011, it became known that the Bank of Russia classified as a risky loan Europroject

Investments Global Limited, allocated to Yusufov for the purchase of Bank of Moscow shares. In September 2011, Yusufov sold his stake in the Bank of Moscow VTB.

Kommersant, 30.09.2011

 

Kostin warned Yusufov of buying the bank’s shares, however, the warning was in vain and he complained to the presidential administration. This, according to the familiar Kostin, could provoke the resignation of Igor Yusufov, who at that time held the post of the president’s special envoy for energy cooperation. The deal with Borodin and his resignation was announced on the same day, while Vitaly Yusufov denied the connection between these events: according to him, the father had long requested to resign.

… Yesterday another event happened that reminded of another Yusufov’s investment – in German shipyards: in the evening, their former owner, ex-deputy general director of the Financial Leasing Company (FLC), Andrei Burlakov, was shot dead. Together with his civil wife, ex-Deputy Chairman of Mira-Bank, Anna Etkin, he came to an interview with NTV journalist Maxim Gladky at the Khutorok restaurant on the Leningradskoye Shosse. The unknown shot from a traumatic gun and seriously wounded both spouses, according to the source of Interfax, – with live ammunition. Burlakov had a weak heart (recently he underwent surgery), and when he was brought to the hospital, he died. On the fact of the attack, a criminal charge was instituted under the article “Attempted murder of two or more persons”. Smooth planned an interview with Burlakov for the filming of a documentary about the fate of another businessman. At the same time, he believes that the causes of the attack should be sought in the more distant past, and not in the history of shipyards, but there is still no point in it.

Slon, 30/09/2011

 

At the end of September 2011, a well-known businessman, former owner of the German shipyards Wadan Yards, Andrei Burlakov, was killed in Moscow. His civil wife, ex-deputy chairman of the board of Mira Bank, Anna Etkina, also suffered seriously.

A month before the murder Burlakov tried to initiate a criminal case against Vitaly Yusufov, as well as to secure the arrest of his stake in the Bank of Moscow.

Director of the anticorruption center “Analytics and Security” Ruslan Milchenko confirmed that Etkina and Burlakov appealed to the center for help. “They said they lost the Wadan shipyard as a result of the raider seizure. We began work on collecting evidence, “said Milchenko. And just before the assassination attempt, Etkin informed law enforcement agencies that in July 2008, a deal was concluded on the acquisition by FLC-West Holding (Luxembourg) of a 70% stake in the Norwegian company Aker Yards

(later it was renamed the Wadan Yards Group – Wygas), which owns

two shipyards in Germany and one in Ukraine. Transaction amount – 291.6

million euros.

“I have never had anything to do with Wadan Yards,” Vitaly Yusufov said. – In June 2009, I started the company Nordic Yards from scratch. Having founded it, on August 14 of the same year I purchased at the auction a property complex left by the shipyards Wadan Yards, which had already gone bankrupt. My application won at an open competition. Plus, under the contract, I undertook to complete two large ferries (the cost of each of them was about 200 million euros), which I did in

2010 “.

Izvestia, 10/03/2011

 

Conflict In February 2013, Defense Minister Sergei Shoigu said in a letter to President Vladimir Putin that the “Telecom Base” (25% owned by the Defense Ministry) does not need frequencies for creating fourth generation mobile communication networks allocated to it without a tender. The “Fundamentals” position – a license can only be withdrawn by a court decision.

Court Since February 2013, is conducting litigation with the Ministry of Defense, trying to revoke frequencies and permits for the activities of the “Fundamentals of Telecom.”

Forbes 2013

 

Dmitry Medvedev’s businessmen have been openly talking about the “purses” of Dmitry Medvedev after the revelations of the runaway banker, former Bank of Moscow President Andrei Borodin, who admitted from London that the former representative of the president, Vitaly Yusufov, was negotiating with him for the sale of the Bank of Moscow, explaining that it is necessary to create personal “pension fund” for one “interesting young man”. By the name of Dmitry Anatolyevich. Later, Borodin announced details of the deal: Yusufov bought Bank of Moscow shares for $ 800 million, and then resold it to VTB for $ 300 million more. “Borodino battle” ended, we can say, a draw: Borodin was granted asylum in Britain as a victim of the Russian political octopus, and businessman Yusufov, close to Medvedev, is $ 300 million. Minus a slight annoyance from the banker’s gossip.

Interlocutor, 11/14/2013

Nordic Yards Vitaly Yusufov, which includes two German shipyards in the Baltic, can get a new asset in Germany – a bankrupt shipyard in Stralsund. The same seller has next to another problem shipyard, which sources “Kommersant” consider it logical to include in the transaction. Both production yards are capable of production cooperation with Nordic Yards assets, and the price of their position is unlikely to be high.

Kommersant, 04.24.2014

 

Voentelecom had a number of projects: “Telecom Base” was engaged in the construction of its own telephone network of the first stage, tested the latest equipment purchased by “innovators” in the United States. And at the end of 2012 it planned to launch the pilot phase of the LTE network, the investment in it was estimated at $ 100 million. About what in an interview with the newspaper “Vedomosti” reported all the same Vitaly Yusufov. So the company, controlled by Dmitry Medvedev, decided to oust the “Big Three” and “Rostelecom” from the mobile communications market

 

But that’s not all. In the above-mentioned interview with Borodin, it became clear that with the mediation of the “special representative Mezhdvedev,” Yusufov “guarantor of the Constitution” instructed the state (ie our own) VTB to give Suleiman Kerimov a loan of $ 5 billion to buy Uralkali. For this, Yusufov received an option for 8-10% of Uralkali shares at the same price, for which Kerimov bought this package from Rybolovlev. Since the capitalization of Uralkali has since doubled, Yusufov’s profit in the implementation of this option was in the region of $ 500 million (how much was received from this deal by “modest American billionaire Medvedev”, not reported).

Institute of High Communitarianism, 08/06/2015

 

A month before the murder Burlakov tried to initiate criminal proceedings against the son of Igor Yusufov – Vitaly, and also to obtain the arrest of his stake in the Bank of Moscow. By the way, then Burlakov and Etkin claimed that the Yusufovs allegedly participated in the raider seizure of the shipyards Wadan Yards. And again coincidence, the killer shot Burlakov and seriously wounded Etkin after she gave evidence in the US court against Yusufov.

… In the media, in particular, it was mentioned that if Burlakov was friendly with Yusufov-junior before the detention facility, when it came out in 2010 on bail of 50 million rubles, it was noticeable that their relationship had sharply deteriorated. Since that time, Burlakov has ceased to especially hide that a special representative of the president was behind the deal to buy German shipyards, designed to hide the machinations of FLC with budgetary money.

New look, 11/26/2015

 

 

Businessman Vitaly Yusufov sold his German shipyards Nordic Yards, because he could not load them with Russian orders. First, ties were not enough, and then devaluation prevented, the expert believes.

In early March, one of the companies of the Malaysian Genting Group announced that it was buying German shipyards Nordic Yards for € 230.6 million. Since 2009, the owner of the shipyards was the Russian businessman Vitaly Yusufov, the son of the former special envoy for international energy cooperation, Igor Yusufov.

… .According to the public reporting of Nordic Yards, in 2011-2012 the company worked with a symbolic profit, but in 2013 showed a loss of € 40.7 million (see table). For the years 2014-2015, reports were not found. In recent years, Nordic Yards has been unprofitable, RBC said a source close to the company: the amount of losses was “tens of millions of euros per year.” According to him, Yusufov spent about € 100 million to support the company. If you add these € 100 million to € 240 million paid earlier, the recent sale of the asset to Malaysians for € 230 million does not look like a bargain.

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