By Lucy Komisar
Nov 2003

A business group headed by Russia’s richest man, Mikhail Khodorkovsky, who was arrested in October for allegedly defrauding the state of $1 billion, stashed money in offshore centers, including Switzerland, Luxembourg, the British Virgin Islands, the Seychelles, Panama and the Bahamas, according to Yelena Collongues-Popova, who worked for one of Khodorkovsky‘s associates.

PARIS — A French woman of Russian origin, with thousands of papers related to the Menatep business group and its offshore banking and dealings over the past decade, has been providing information to Russian prosecutors who are building a case against oil tycoon Mikhail Khodorkovsky, the richest man in Russia, who was arrested in October for tax evasion.

She says she set up numerous offshore companies and bank accounts in the Caribbean and Europe to help the Menatep group cheat Russian company shareholders and tax authorities. Her registered agent in the Caribbean was Icaza Gonzalez Ruiz and Aleman in the British Virgin Islands and Bahamas, against which she now has a legal action. She says she used Bank Leu (Bahamas), a subsidiary of Bank Leu, Geneva, to deposit funds in fiduciary accounts to have the benefit of withholding tax exemptions.

Yelena Collongues-Popova, 49, a Russian living in Paris, says that she worked for Khodorkovsky associate Alexei Golubovich from 1996 to 2000. She has boxes of papers relating to the Menatep, Rosprom, Yukos and Avisma companies, all linked to Khodorkovsky’s rise to riches and fame. Russian, French and Swiss police and prosecutors are examining numerous papers of transfers of stocks of these companies for evidence of what Collongues-Popova claims to be evidence of forgery, insider trading and tax evasion.

Khodorkovsky was arrested in October by Russian prosecutors and charged with seven counts of fraud, embezzlement, forgery and tax evasion. Golubovich is said to have fled to London, but there is no warrant for his arrest. However, French businessman Roger Kinsbourg, who has lived with Collongues-Popova for 10 years, said that Golubovich’s brokerage, Russian Investors OAO, which held shares of Yukos and other companies on behalf of clients, is the target of an inquiry by the Russian Interior Ministry, the MVD.

Kinsbourg said that Golubovich has offered to have MVD agents meet with his lawyers in London. Golubovich could not be reached for comment, but I have seen documents sent by Russian prosecutors to Collongues-Popova for questions on stocks transfers to various Yukos owners and off-shore subsidiaries or associates.

Forged signatures?

Kinsbourg said that the Russian Interior Minister asked Collongues-Popova to come to Moscow in July to testify. He said that Nikolai Borisovich Shumilov, the MVD inspector, asked Yelena if she would testify in cases against Menatep Group about the frauds and use of forged documents and tax evasion by Yukos, Golubovich and Russian investors. He said that she would not go, as she believes it to be too dangerous. But, on Aug. 4, she sent the Russian Tax Police six pounds of documents, including corporate papers, trading reports and bank statements from 1996 to 2000 that she says show insider dealing and tax evasion by Golubovich on behalf of himself and the Menatep empire controlled by Khodorkovsky.

In fact, the MVD made her an offer she couldn’t refuse. Kinsbourg said: They said she is an accomplice, and that ‘We will try to extradite you to Russia if you don’t cooperate.’ Yelena is a French citizen, but there are problems if you go to a third country. She doesn’t want that. She hasn’t been given immunity by Russian prosecutors.

After Collongues-Popova provided the MVD with her documents, the MVD, in return, made available to her papers that show that her signature and identity were used without her knowledge for transactions of Yukos shares. Kinsbourg said the MVD got the documents when they raided Yukos offices and via public-company registration and share-transfer records.

He explained that, through offshore companies, Collongues-Popova and Vladislav Borchanikov, her son from her first husband, a former colonel in the Russian special services, had been listed as directors of companies holding hundreds of million dollars worth of shares of Yukos and other Menatep companies. Kinsbourg showed me numerous such papers. One of them was related to a company Sequential Holdings. In 1999, Collongues-Popova was a director of Sequential Holding Russian Investor, a shell company that held 12.5 percent of Yukos.

He said, The MVD sent us documents relating to Yelena receiving shares of Yukos. According to documents she had ownership of zillions of shares and that she transferred them to other entities. But she did not have the shares. A lot of [the transfer documents] were not signed by Yelena. He said the MVD had found papers with Yelena involved in companies she didn’t know she was involved in. It may be that some of those Yukos shares are invalid, because she didn’t sign those papers. He said, We got pages of questions from the MVD: ‘Did you sign this, did you sign that?’ They asked for fingerprints and a notarized signature.

It is a crime to do a stock transfer without knowledge of the owner or through falsification of the owner’s signature.

An insider and $300 million

Collongues-Popova collected the evidence from 1996 to 2000, when she ran the offshore operation for Golubovich, then financial director of Yukos, the oil company at the heart of the Khodorkovsky empire. Khodorkovsky resigned at CEO of Yukos on Nov. 2. His shares in the company have been frozen by prosecutors.

Golubovich, with a fortune estimated at $1.3 billion, has been a business partner of Khodorkovsky since 1989, when, according to Collongues-Popova, they formed Bank Menatep. Its successor, Menatep Group, is the holding company of Yukos, now YukosSibneft. Collongues-Popova says that Golubovich’s faxed instructions carried the phone number of Bank Menatep until the bank closed in 1999.

Collongues-Popova was related to various companies carrying the name Menatep in various offshore and European jurisdictions. Gibraltar-based Menatep is now a controlling shareholder in Yukos.

Collongues-Popova was born in Russia, the daughter of an academic who belonged to the nomenklatura. She is a graduate of the Institute of Finance of Moscow and worked in the Soviet state bank. She first married a Russian, then, in 1983, she wed a Frenchman stationed at the French Embassy in Moscow. She later divorced him, but kept dual citizenship.

Her connection with the Khodorkovsky empire began in August 1995 in Saint Tropez, on the French Riviera, at the home of Frenchman Bernard Loze. There, she met Golubovich, who was then deputy chairman of Menatep Bank. He said, according to Collongues-Popova, that he had started Menatep with Khodorkovsky in 1989. Loze is a stock broker and portfolio manager who specializes in the offshore management of fortunes. Today he is a board member of Yukos.

Collongues-Popova began to work for Menatep Trade House, then a branch of Menatep Bank, first with Olga Mirinskaya, Golubovich’s wife, and then directly with Golubovich. She says that at Golubovich’s instruction, she set up 30 shell companies to be owned by him and registered in the offshore jurisdictions of Switzerland, Luxembourg, the British Virgin Islands, the Seychelles, Panama and the Bahamas. Kinsbourg says he has bank-account documents that list the companies’ ownership and many transactions carried out by them.

Collongues-Popova was the director of many of the companies and the owner of Commodities, which she had earlier set up for her own trading, and of Russian Investor Group of Panama.

Collongues is the sole stockholder and administrator of the plaintiff, Coffee Commodities, a BVI company, and also the sole stockholder and administrator of the defendant, Russian Investors Group Ltd. (RIG), based in the Bahamas. Golubovich, however, is the economic beneficiary of the RIG accounts at Bank Leu in Geneva.

The registered office for Coffee Commodities Ltd. is Vanderpool Plaza, 2nd floor, Wickhams Cay I, Road Town, Tortola, BVI, and, for Russian Investor Group Ltd., Bay & Frederick Streets North, Box CB 12736, Nassau, Bahamas. The latter is not the Russian Investors OAO, which is Golubovich’s Moscow brokerage. Kinsbourg said, His trick was to do companies with similar or partly similar names. He explained that a check sent to one Russian Investors could easily be cashed by another. Among the companies were Wilk Enterprise, Sequential Holding Russian Investors, Alliance Properties SA and Russky Produkt.

He said, The registered agent for all the Caribbean companies was Icaza Gonzalez Ruiz and Aleman from the BVI and Bahamas. But the decision maker is Dr. Roberto Aleman from Panama.

Letter to set up Cyprus shell company.

In Paris, Collongues-Popova opened a liaison office for one of the companies, Alliance Properties SA, and registered another, Russky Produkt (formerly Menatep Trade House), a subsidiary of Rosprom. The French Tax Police would eventually follow those connections to charge her with tax evasion.

Some of the offshore companies held Yukos shares. Kinsbourg said that Collongues- Popova had held as much as 30 percent of Yukos shares in shell companies. She said, In the [Kenneth] Dart affair, two companies, Sequential Holding Russian Investors and Wilk Enterprises, served as vehicles to make believe they were stockholders of Yukos. Dart, an American investor, claimed he was swindled when Khodorkovsky forced down the value of his shares. Collongues-Popova was the nominee and director of Sequential Holding Russian Investors (SHRI) which was held by a Luxembourg offshore company.

Collongues-Popova said she opened accounts to receive money from other offshore companies.

She said, Significant transactions of stocks of private Russian companies quoted on the Moscow Stock Exchange passed under my signature in the years 1997 and 1998. They constitute the evidence of insider crimes and of infringements of the anti-monopoly laws. She said the companies were also used for operations of tax evasion and transfer pricing.

Collongues-Popova said she also dealt with Rosprom and other Khodorkovsky/ Menatep companies in operations that involved the purchase at cheap price and the resale at market or fixed prices of advance industrial material or manufactured goods [such as textiles] in factories belonging to the Menatep Rosprom-Khodorkovsky Group. She said, These ‘back-to-back’ transactions were intended to enrich a certain number of people on the profits realized in undervaluing the goods embezzled from the assets of companies controlled by Menatep and resold at full price.

Collongues-Popova said she used offshore companies to effect back-to-back sales of Rosprom-held shares in order to evade Russian taxes. Kinsbourg explained that they would transfer shares to an offshore company making believe it was real (Continued from page 11) buyer; but in fact it was themselves, and they would roll that to a final buyer.

Kinsbourg said Collongues-Popova moved shares via offshore companies also to escape tax on capital gains for the true owners. He said, We have papers showing the purpose of this exercise was to escape taxes using Yelena as the foreign investor. She had hundreds of millions of worth of shares. Yelena, her son, and myself – I accepted to appear to be a shareholder of a tire company – all this is coming out.

Collongues- Popova said, They also put the stocks of companies offshore in order to evade the Russian antitrust law. The true owners listed her as the owner of stocks also so that the thresholds of participations in the companies by non- Russian residents were not exceeded. She said that was done without her knowledge through a company called Wilk Enterprises Ltd. of Cyprus. She said, This explains the existence of about 15 offshore companies with Swiss accounts under my signature. Collongues-Popova said that, to persuade authorities she was a big foreign investor, her bosses sent her to Moscow with a red carpet and chauffeur, a big show.

Collongues-Popova noted that certain ‘mysterious’ fortunes grew along with the flight of capital from Russia, particularly at the time of the financial crisis of August 1998, and supported by fictitious contracts intended to comfort the recipient banks that due diligence had been done in the various bank havens. She said the resulting profits were concealed in Switzerland, Luxembourg, the United Kingdom, Cyprus and the United States. She said transfers to the great moneycenter banks such as J.P. Morgan Chase, the Bank of New York and Citibank appear on the bank statements of the Swiss accounts under her signatures.

They were, she said, opaque financial arrangements or the products of trade operations relating to Group Menatep, as well as various Russian companies in which Menatep held participation or by Rosprom, Khodorkovsky’s chief holding company at the time. She said money came from Russia, Cyprus (via the Bank Menatep subsidiary of the same name in Nicosia) the United States and London. Collongues-Popova said that more than $300 million was forwarded by various Golubovich-connected shell companies to the Swiss bank accounts in 1998. She said she handled transfers to bank accounts set up by Golubovich and his wife Olga Mirimskaya for some of these funds. The banks included Finter Bank, Bank Leu, Lombard Odier, Darrier, Ruegg SG in Switzerland and Hellenic Bank in Cyprus. Bank Leu in Geneva, a subsidiary of Credit Suisse, got the most deposits.

Kinsbourg said instructions given to Swiss banks were signed by Golubovich but relayed from Russia to Paris, then Paris to Geneva. He didn’t want to fax direct since faxing direct from Russia to Switzerland is not a good idea. We have all the documents; she acted as an agent.

Kinsbourg says that Collongues-Popova has bank statements that show Golubovich as the beneficial owners of the assets placed by the offshore companies, We have 100 pounds of bank statements. It’s been seized by the French Tax Police. She doesn’t want to put herself in a situation where she may be sued for divulging some of the information to third parties.

French Tax Police

Since many stock purchases were in the names of shell companies Collongues-Popova had set up, she paid out millions of dollars in transfers in her name. Then in October 1998, the French Tax Police staged a raid on her apartment. The French were looking into connections to the Bank of New York money-laundering scandal, which investigators believed involved Menatep.

Documents they seized showed that Collongues-Popova had paid tens of thousands of dollars for trips and entertainment – the mark of a rich woman who hadn’t paid appropriate taxes! In investigations, authorities found that she had conducted transactions on French territory via a liaison office for one of her offshore companies, Alliance Properties (Panama) and its account at Banque Nationale Paribas (BNP) of Geneva, which she used in the operation for Golubovich. Alliance had been owned by Collongues-Popova before she met the Russians, as had Capital Preval Management Inc., another Collongues-Popova offshore company she used for payments and transactions and to handle Russian credit cards. And they saw the documents of Russky Product.

In late 2000, responding to a French request through Interpol, Russian police conducted an investigation of Collongues-Popova’s affairs in Moscow.

The French ordered her to pay 15 million Euros [more than $15 million] in tax and penalties. She sought Golubovich’s acknowledgment that the companies were part of his operation. He balked. Instead, in 1999 and 2000, as Collongues-Popova’s trouble with the French tax authorities became increasingly severe, Kinsbourg said Golubovich or members of his staff took over her directorships.

At the same time, Khodorkovsky had to clean up the ownership structure of Yukos, according to Kinsbourg. Kinsbourg said, The goal was to get [listed] on the New York Stock Exchange. You can’t go on the stock exchange saying there’s a myriad of offshore company holders, nobody knows who the shareholders are. Nobody’s going to invest; not at that level. So, he said, the Khodorkovsky group put together a trust arrangement with Menatep in Gibraltar and forged Collongues-Popova’s signature in 1998, 1999 and 2000 to transfer the shares held by offshore shell companies, to make official what they already had. He explained that Yelena was in Paris, and they couldn’t send paperwork here back and forth daily, so they just forged her signature without her knowledge. He said one document showed Collongues-Popova with 50 million or 60 million Yukos shares worth $15 a share.

Kinsbourg, however, admits that we have documents but we can’t always reconcile the links. We can’t identify whether the shares Yelena controlled through offshore companies ended with those names [of major owners] or the trust. We don’t have the chain of transfer. We have a blank between the moment Yelena held millions of Yukos shares in various companies and when you find them later. She does not have paperwork to show which of the shares she transferred eventually ended up in Menatep Gibraltar or other jurisdictions. The paper trail goes cold from the time the shares leave her hands, he said.

The way they operated was to try to make it obscure; even if we have some of the documents, we don’t have the continuity, Kinsbourg said. Only the MVD, which has other documents, can make that reconciliation.

Further, Collongues-Popova controlled offshore companies and accounts only of Golubovich and had no direct dealings with either Khodorkovsky or Platon Lebedev, another Yukos shareholder who has been in prison since July of this year.

The Caribbean connection

Collongues-Popova has a legal case against Icaza, which she threw out as registered agent for Russia Investors Group Ltd. (Bahamas.) Kinsbourg explained, They were in cahoots with Golubovich’s gang. Although Elena is the sole shareholder of the company (RIG) and the appointed sole director (according to Icaza’s own certificate of incumbency dated 8 January 2001, upon which they reneged), they refused to execute her instructions and appointed a lawyer to make her case difficult on the basis that Golubovich was holding a (bogus) certificate of all RIG’s bearer shares – an instrument that has no legal basis under Bahamian laws! He added, Moreover we hold two official reports of findings by a Geneva judicial bailiff evidencing without doubt that Elena holds all RIG’s shares.

He said that as a result, Collonges-Popova revoked Icaza as registered agent and appointed Arnold A. Forbes in September 2002. He said, Icaza tried to resist the change by not transferring the corporate documents to the new registered agent and tried to drag us in front of the Supreme Court. We circumvented this lengthy and astronomically costly legal procedure and made the transfer of registered agent ourselves at the Registrar General of Companies in Nassau showing Arnold Forbes as RIG registered agent and Elena as sole director.

A Swiss case

Collongues-Popova is seeking to freeze Golubovich’s Swiss assets on grounds of right of retention because of the French demand she pay taxes that were justly his responsibility. She filed criminal charges in Switzerland against Golubovich, charging that he forged her signature to get $5 million from a Swiss account she operated for him. She fought Golubovich’s claim to the money in court and won both in a lower court and on his appeal.

Kinsbourg said, We won the case in October (Coffee Commodities v/s Golubovich et al pretending to represent RIG) in Geneva Appeals Court, which upheld that our official documents were the only ones to be considered. Nevertheless Golubovich is still trying to drag the case on in Nassau by a Writ of Summons against RIG and Elena, using one of the most prominent law firm in the Bahamas, Lennox Paton in Nassau. He said Collongues-Popova had still not been served.

Kinsbourg said, Golubovich is trying to use this legal masquerade in the Bahamas to delay the outcome of the implementation of the Swiss Appeals Court decision in favor of Elena. He said Golubovich had obtained a suspension of the decision, and Collongues-Popova has responded by filing misconduct charges against the Commission de Surveillance de l’Office de Poursuites for not executing the Appeals Court decision.

Negotiations

Last year, Collongues-Popova negotiated via Lebedev for a settlement to pay her French taxes and penalty. Kinsbourg said Lebedev expressed concern that the dispute was having a negative impact on Yukos stock. Kinsbourg related: Lebedev said, ‘I want to be middleman for settlement. To prove my good will, I will give you half a million dollars as pocket money for Yelena to pay her bills.’

Kinsbourg said, There were over 100 million French francs in taxes; we were not interested in half a million. We refused. Then things got tougher. Yelena said, ‘Maybe if I’m not compromised.’ They said, ‘O.K., no problem, we’ll give you a straight loan. But then Lebedev withdrew the offer. They are idiots, said Kinsbourg. Yelena now is a witness for the MVD.

In addition, Kinsbourg said, We have pressed criminal charges against Golubovich in Geneva for forging Yelena’s signature on transfer of a loan to one of his companies.

Geneva investigative magistrate Claude Wenger is conducting an inquiry into Collongues-Popova’s charge that Golubovich forged her signature.

Yukos was contacted to obtain comments on this story, but no response was forthcoming.

Khodorkovsky Group Offshore Entities

Ensign Corp. Bahamas
Russian Investors Group Ltd. Bahamas
Ideal Corp. Belize
Non-Ferrous Metal Company Belize
Cavendish BVI
Davenport Group SA. BVI
Preval Capital Management Inc. BVI
Socram Ventures Ltd. BVI
Whitehill Capital Resources BVI
Direct Invest Equity Fund Ltd. BVI
New Industrial Management Co. Ltd. BVI
Cromwell Financial Ltd. BVI
Manorex Finance Ltd. BVI
Leach International Ltd. BVI
Laurens Corporation BVI
Tristar Business Corporation BVI
Devarex International SA. BVI
Valpen Group SA. BVI
Deepson International SA. BVI
Frost Impex Inc. BVI
M.Q. D. International Ltd. BVI
Alliances Properties SA. Panama
Carmore International Inc. Panama

  Russia, tax evasion