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Blood on the Water: Cyprus’ Dirty Russian Money Stain

March 5, 2022

Cypriot President Nicos Anastasiades’ government is so Russian-friendly it’s a wonder his office doesn’t cue up the Soviet National Anthem in the morning, but even he had to denounce Putin’s War, the invasion of Ukraine.

It looked for a while that Cyprus wouldn’t though, because there’s so much Russian money in the country that’s it’s long been regarded as a hideout for tax cheats – and known for laundering so much money the symbol on the flag should be a washing machine.

There’s a reason why Cyprus is called Moscow on the Med, a deserved reputation for looking the other way when the Russian money poured in, courtesy of Russia’s wealthy, who were also able to buy Cypriot residency permits and European Union passports.

They’re so rich they didn’t even blink when Anastasiades, breaking a campaign promise before you can say Nyet – make that Da – let those same banks who were going broke over bad Greek loans and devalued Greek bonds confiscate 57.5 percent of accounts over 100,000 euros ($110,776).

That’s spare change for some them and a small price to pay to stash away fortunes without being vetted – “Nyet to Vet!” – and a lot of them are investors there too. Just check out the signs in Russian on the way out of the airport.

But a lot of this can be traced back to the Kremlin and President Vladimir Putin, who is tight with the oligarchs, and his country banking on Cypriot and European Union subservience in return for Russian oil and gas.

While there are boycotts in many countries against Russian vodka and products and some bar their drugged-up athletes – whom the International Olympic Committee let compete at the Beijing Pharmaceutical Games – Cyprus is still happy to let Russian money come in, uncaring how it was made.

In the U.S. news site The Hill, Martin J. Sheil, a retired supervisory agent for the IRS Criminal Investigation, said a so-called Money Laundering Death Penalty should be put on Cyprus.

“The U.S. Treasury should declare Cyprus a jurisdiction of ‘primary money laundering concern.’ Western Banks would cease transacting with banks within such a jurisdiction,” wrote Sheil.

Don’t look for the Eunuch Union to do anything, although the bloc’s timid leaders, who are so tepid they are they are the type that made Jesus say, “I spit out of my mouth the lukewarm” were forced by outrage to impose sanctions.

That would include banning Russia from the SWIFT scheme that makes it easier for banks to do international transfers, but Cyprus really didn’t want to do that and was forced to, to quash initial reports it was siding with Russian banks.

Sheil noted that the BBC in 2013 reported that, “it is estimated that one-half to a third of all Cyprus bank deposits are of Russian origin,” and in 2020 Al Jazeera reported the residency permits given wealthy Russians, estimated at more than 1,000.

In July, 2019, anti-corruption and human rights activist Bill Browder pointed out what he called the problem of dirty Russian money on Cyprus – adding to his being targeted by the Kremlin for speaking out.

The U.S.-born British financier, who has campaigned against Putin and Russian organized crime, told Politico then that,” Russian organized crime has fully infiltrated Cyprus law enforcement.”

“The Cypriot authorities are effectively welcoming Russian laundered funds by not creating any consequences for the launderers,” Browder said. “Russia has been using Cyprus as the Trojan horse for getting money into Europe. It’s one of the weak links for Europe to fight Russian organized crime.”

CNN said it was told by senior sources it didn’t name that there was division in the EU about how tough to get with financial sanctions that otherwise could be weakened if Russia can still use SWIFT, with the debate going on days after Russia invaded Ukraine and killed at least 2,000 civilians.

Before Cyprus bowed to almost certain pressure that wasn’t publicized – or shame – Daria Kaleniuk, Executive Director of Ukraine-based Anti-Corruption Action Centre, accused Cyprus and other countries of “sabotaging sanctions against Russia,” said the site The Print.in.

Arthur Kharytonov, President of the Liberal Democratic League of Ukraine, referred to Cyprus as a ‘Putin bank’, but losing Cyprus was a blow to the Russian leader who long has counted on its servitude.

Max Seddon, Moscow bureau chief at Financial Times, said the turnabout of Cyprus “is potentially a bigger deal than even Germany signing on – Cyprus is one of Russia’s biggest foreign investors (Russians with Cypriot offshore companies investing back in Russia) and the second biggest bank in Cyprus is Russian.” Do the math – with a Cray supercomputer.

Mike Martin, Visiting Fellow, Department of War Studies at King’s College, London, said Cyprus’ move is making Putin “nervous,” given that Cyprus is the “the home of Russian money laundering,” the report added.

In 2018, five years after Cyprus and its banks nearly went bust, the British newspaper The Guardian reported there was so much Russian money in the second-largest city of Limassol – with 50,000 Russians there – it was called Limassolgrad, and they built it up with marinas, businesses, and major projects.

For years, Cyprus has heard the Ka-Ching sound of Russian cash registers and they’re still so loud you can hear them even over the bombs landing in Ukraine.


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