The Russian billionaire appears to own at least one additional property in St. Barths that hasn’t been reported before.
In 2009, Roman Abramovich paid $90 million for his 70-acre estate on the Caribbean island of St. Barths, a French overseas territory. It was one of 41 properties linked to sanctioned individuals that were frozen by French authorities in April, a list that included Abramovich Castle on the French Riviera.
Missing from this list: a second property in St. Barths, whose ties to Abramovich have not previously been reported. In the heart of Gustavia and a stone’s throw from the glitzy waterfront is an abandoned, half-renovated building that Forbes tied to sanctioned oligarch. (A spokesperson for Abramovich did not respond to Forbes’ requests for comments).
Ownership is no big secret in St. Barths. “Everyone knows” it belongs to Abramovich, a local businessman said. By February, construction workers had renovated the building – along with Abramovich’s beachfront home – but, “a few days after the war, the construction cranes packed up and left with all the construction crews. construction” on both properties, an islander said. Forbes; several other local sources also confirmed this sequence of events.
Building ownership is a case study in the difficulties of tracking and identifying assets held by sanctioned individuals. An offshore company named Ranelagh Investments Limited owns the Gustavia property, according to construction permits nailed to the building. (A name, Tamara Jakovleva, also appears on the permits). Ranelagh Investments Limited is incorporated on the island of Jersey, a British crown dependency popular as a tax haven for high net worth individuals. Ranelagh’s registered agent, according to its incorporation documents, is Zedra Trust Company, a Jersey-based finance company.
Zedra is the registered agent for numerous other Jersey-based front companies that hold Abramovich-related assets, including helicopters and a yacht, and has worked with Abramovich since 2016, when it acquired a trust company from Barclays PLC, according to recent reports. in the FinancialTimes and the wall street journal. (Zedra did not respond to a request for comment, but told the Log he adheres to the sanctions).
The building in Gustavia is “another example of the fact that sanctions are easier said than done”, says Tom Keatinge, who heads the Center for Financial Crime and Security Studies at the Royal United Services Institute, a UK think tank. “Countries will need to invest considerable time in identifying companies and other assets whose links to sanctioned individuals are obscured.”
Norson Harris, a former Zedra executive who now works at Trident Trust (another Jersey company), appears on the company’s incorporation documents as a nominee director – a sort of stand-in for the real owner of the building.
“A nominee administrator offers a veil of anonymity to the true beneficial owner by being the one who appears on the documentation and can also sign the documents and all the transactions carried out by this front company,” explains Moyara Ruehsen, who oversees crime management. financial. program at the Middlebury Institute of International Studies. “They actually have no control over the assets of the accounts held by this front company, as they are signing a power of attorney to the true beneficial owner.” (Harris and Trident Trust did not respond to requests for comment).
Jersey financial authorities, however, are hot on Abramovich’s trail. They announced in April that they had frozen $7 billion in assets belonging to the sanctioned oligarch, without providing further details. The UK territory is preparing to announce more frozen assets, a source familiar with the matter says Forbes. And earlier this week, the the wall street journal reported that authorities in Jersey had opened a preliminary investigation into Abramovich’s dealings. (He was not charged with wrongdoing).
While it’s unclear whether the Gustavia building is among those once frozen by Jersey, its half-completed and abandoned state highlights some of the negative externalities involved in the asset freeze.
“If the building is destroyed by a hurricane, who will pay? Who will repair the damage? asks Emmanuel Jacques Almosnino, a St. Barths-based lawyer who works with wealthy individuals. Due to the sanctions, “Abramvich cannot pay the insurance policies,” notes Almosino. “He can’t wire money to contractors to fix something or to complete a construction in progress. It’s a very strange situation, not only for him, but also for everyone who works with him.
Abramovich, who made his fortune in the chaotic 1990s of post-Soviet Russia, has a long history in St. Barths. His former yacht, The big Blue (which he later gifted to Eugene Shvidler) was pictured docked in Gustavia as early as 2005. Abramovich reportedly spent $5 million on his first New Year’s Eve party in 2009; these parties have become an annual event on the island. He endeared himself to locals through philanthropy – funding the restoration of a local saltwater pond and twice renovating the local sports complex.
“People like Abramovich are so wealthy that their mere presence on the island has an impact on the economy,” says Bruno Cousin, assistant professor of sociology at Sciences Po in Paris, who has written about wealth in St. Barths. “For people like them, the island is trying to cultivate a relationship.”
One of the ways to do this is to make real estate investing easy and inexpensive. “There is no annual property tax here. It is obviously very interesting if you buy a house for 10, 15, [or] 20 million euros,” says Tom Smyth, an American real estate agent who sells high-end properties in Saint-Barth. The costs, legal restrictions and other barriers to entry found in some Caribbean countries “don’t exist here,” says Smyth.
Indeed, no one should be surprised if authorities in Jersey disclose additional properties in St. Barths that belong to Abramovich; multiple island sources said Forbes The oligarch’s property portfolio in St. Barths includes even more homes, but declined to give further details.