A luxury resort in Paphos built near environmentally sensitive land on the coast of Paphos got its first financing from companies said to be linked to an alleged tax fraud in Russia, according to the Organised Crime and Corruption Reporting Project (OCCRP).
In a report published this week, the OCCRP claims that one of the first buyers of a villa at the Cap St Georges resort was a company owned by Dmitry Klyuev, named by British-American financier Bill Browder as the alleged ringleader of a criminal group behind an alleged – by Browder – tax fraud in Russia known as the ‘Magnitsky Affair‘.
The OCCRP said one of the companies originally behind the resort was part-owned by Russian businessman Igor Sagiryan, whose Panamanian company received $2 million from Klyuev-owned companies.
“These Klyuev-owned companies had themselves been paid by companies that received proceeds of the fraud, according to exhibits presented by the US Department of Justice in a US civil case.”
The Cap St Georges development was advertised as a plan for 50 houses near protected areas of the Akamas peninsula. Today it includes a hotel and 200 private villas.
According to the OCCRP, in March 2007 a company called Alpha Arch Investments Limited was incorporated in the British Virgin Islands, “apparently to manage investments into the eventual development of Cap St Georges.”
The OCCRP goes on: “Cypriot company Melkov Limited bought one of the first villas for €3.3 million in October 2009. Reporters could not find documentation of Melkov’s ownership for that month, but Klyuev is named as the company’s controlling shareholder in a December 2009 management agreement with a Cypriot fiduciary services firm. Melkov purchased the villa ‘A1’ from Silfona Developments, a Cypriot company ultimately owned by Alpha Arch.”
In December 2015, Alpha Arch’s subsidiaries sold the Cap St Georges real estate for €16 million to companies owned by Cypriot businessman George Ioannou.
“Since then, the resort has grown into a sprawling development of 200 private villas with swimming pools, a hotel with 202 rooms, and accompanying sewage treatment plants,” writes the OCCRP.
“Advertisements and billboards around Cyprus identify the luxe resort’s developer as Korantina Homes, a company owned by Cypriot businessman George Ioannou.”
Contacted by the OCCRP, Ioannou said that when developing that area, “we were very cautious in abiding to all enforced regulations including environmental restrictions so that the development will not interfere or harm the natural beauty of the area.”
The OCCRP said that from 2016 to 2022, Ioannou’s companies made at least €170,000 in political donations, including every party continuously in parliament in the past decade except the development’s critics – the Green Party. Theano Kalavana, chairwoman of OPEK, a Cypriot think tank, told the OCCRP the donations were “generous” by the standards of Cypriot political giving.
Asked to comment on this, Ioannou said that all his political donations had been “below the maximum extent of contribution allowed by law” and that each donation was “transparent and is public data.”
Other than Klyuev, the OCCRP report names no sanctioned Russian nationals.
