NICOSIA – In a move to avoid European Union and western sanctions against Russia over its invasion of Ukraine, a group of partners at the Big Four auditing firm PwC left to set up their own company to get Russian clients on Cyprus.

The island is a haven for rich Russians and Russian businesses, as well as tourists but EU sanctions have barred Russian airlines, especially hurting the Greek-Cypriot government for whom Russians are a big revenue source.

Kiteserve, set up by three former PwC partners, will work for clients connected to Russia major firms won’t accept, said the British newspaper The Telegraph, citing The Financial Times.

Accounting and consulting companies on Cyprus have taken a hit over the sanctions against Russia but it wasn’t said why the new firm was willing to get around the penalties or would face problems over it.

So far it’s working though as the new firm has taken some 20 or 30 workers from PwC and about half of its clients will have a Russian connection, said the paper, allowing it to skirt sanctions and benefit from Russian money.

The firm will operate out of PwC’s offices in Nicosia and Limassol, but the big four firm said that the space was separate to its own office space and was being sublet to Kiteserve, apparently willing to oblige the breakaway.

Theo Parperis, Managing Partner at Kiteserve, told the Financial Times that the firm will observe EU, US and UK sanctions, but added: “The Big Four went well beyond the sanctions imposed by these countries … and, effectively, we’re covering that space to a certain extent, but … we were very selective.”

He said that about half of Kiteserve’s clients had links to Russia but predicted this would reduce over time and that the work was mostly related to assets in the West rather than in Russia.

“These clients … are serviced also by Western banks, by Western lawyers. So why should we be singled out?” said Parperis.

The Kiteserve founders struck a deal for an undisclosed sum with PwC to buy themselves out of restrictions on hiring PwC Cyprus staff and a five-year ban on former partners selling audit, tax or compliance services, the FT reported.

In early March, PwC announced that it would exit the Russian market following the invasion and has since cut ties with clients who have been sanctioned in any jurisdiction but the new firm has shown no reservations.