In the first French criminal seizure of property owned by a Russian oligarch, authorities have arrested a luxurious €23mn villa in Saint-Jean-Cap-Ferrat in southeastern France, which authorities claim belongs to the majority shareholder of Magnitogorsk Iron and Steel Works (MMK), Viktor Rashnikov, Le Monde reported on March 1.
This is the first time French authorities have made use of EU sanctions legislation to seize assets belonging to a Russian on the sanctions list.
Le Monde reports that the seizure was made in October 2022, following a request by magistrates from the National Jurisdiction in Charge of the Fight Against Organized Crime (JUNALCO) of the Paris prosecutor's office.
A spokesperson for Rashnikov responded: “The article [in Le Monde] contains false information: Mr. Rashnikov does not own any real estate located in Saint-Jean-Cap-Ferrat, or anywhere else, that is allegedly registered to any third parties. He knows nothing about the villa in Saint-Jean-Cap-Ferrat that is mentioned in the article, and, accordingly, he could not in any way be engaged in its sale, either personally or through other individuals or legal entities.”
The spokesperson went on to add that all of Rashnikov properties in France have a “transparent and legitimate ownership structure,” and already been disclosed to the proper authorities.
“Information about his property has been disclosed to the competent authorities in accordance with local regulations. Therefore, any speculations about any villas, their sales and arrests, or about any other property owned by third parties in his interests and which are presented in the article are false and unreliable information and constitute a clear instance of libel,” the spokesperson said, adding the case was being considered by Rashnikov’s lawyers who might seek legal redress.
Prior to the seizure, three properties in Paris and the French Riviera linked to Rashnikov by the authorities had already been administratively frozen. However, the villa in Saint-Jean-Cap Ferrat had gone unnoticed as it was not declared to the tax authorities as being his property, Le Monde reports. The villa is owned by a Swiss company controlled by a Panamanian structure in a complicated ownership scheme.
France's financial intelligence unit TRACFIN was informed of the sale of the villa, which occurred shortly after the Russian invasion of Ukraine. TRACFIN claim that the villa belonged to a Russian citizen suspected of being Rashnikov's frontman, and that the new owner was also Russian. TRACFIN then blocked the money from the sale, which amounted to €17mn after the deduction for duties and taxes, before taking the matter to court.
France is in the midst of a crackdown on corruption and money laundering and is taking an increasingly tough stance on Russian oligarchs and their assets following the Russian invasion of Ukraine in 2022. French authorities have already frozen several properties and bank accounts linked to Russian oligarchs and their associates.