Friday, 24 May 2019

MfD: Prague becomes safe cache for Russian money

ČTK |
17 September 2015

Prague, Sept 16 (CTK) - Prague has become a safe place where rich and influential Russians invest their money mainly in luxurious real estate, while security services are not able to fully control such a strong flow of finances from the East to the Czech Republic, Mlada fronta Dnes (MfD) writes yesterday.
The Czech authorities can freeze money heading for the country only in the case it belongs to a person on the European Union's blacklist, MfD says.
According to a survey conducted for the paper, one-fifth of flats in new residential complexes built in Prague are owned by Russians or their firms.
The purchase of real estate is a safe way of getting finances from the unstable domestic market to "a safe ahrbour." Moreover, it is a profitable investment since most of the Russian owners are leasing their flats, MfD says.
It cites a few examples of such rich Russians.
One of them is Vasily Kuzubov, former deputy governor of the Krasnoyarsk province, the second largest Russian region, who owns a large penthouse in the River Diamond building on the embankment near the centre in Prague-Karlin.
Kuzubov as well as many other Russian owners of apartments in Prague do not live in the Czech Republic, but they have only deposited money there at the times when their country has ended up in isolation over the conflict in Ukraine, MfD notes.
It is hard to find out the origin of the money that Russians have spent in Prague in the past few years. Nevertheless, undoubtedly only people who have power and influence at home, like Kuzubov, can afford similar investments, MfD writes.
It says his flat was first bought by the VID Invest company for 21.6 million crowns in April 2008. The contract was signed by its owner Oleg Vidmanov from Moscow. Last February Vidmanov transferred the company along with the apartment to Kuzubov, who apparently assigned his friend Vidmanov to buy the apartment when he still occupied a high public post.
MfD writes that Russians and Russian firms own 16 percent of apartments in the River Diamond residence. Their neighbours are several famous Czech personalities, such as national ice-hockey team coach Alois Hadamczik and Sparta football club general director Adam Kotalik.
Russians have also purchased many apartments on the left bank of the Vltava (Moldau) River, in the Prague Marina residential complex in Holesovice. Almost one-fifth of the 338 flats there are owned by Russians, MfD says.
One of the owners was Vladimir Yermakov, long-term director of the Vemex gas company, a subsidiary of the Gazprom oil concern, in which Russian state has the main say, and chairman of the Russian-Czech Mixed Chamber of Commerce. He gave the apartment to his daughter Anna, 23, two years ago.
Her neighbour is another influential Russian businessman, Evgeny Kashitsyn, head of the Gazprom Export Czech branch, which is another subsidiary of Gazprom, MfD says.
It recalls that Russians were not allowed to buy real estate in the Czech Republic directly until 2009. The only possibility was to buy a domestic firm that owned a flat. The firms were therefore established for the single purpose to purchase flats and then they did not run business any more. This practice probably still continues, MfD adds.
It also writes that the Czech intelligence services have been warning for a few years that Russian influence on public affairs in the Czech Republic has been rising wherever Russian money flows, MfD says.
"Czech participation in international science-technological projects has become the aim of Russian interest," the BIS civilian counter-intelligence service writes in its latest report, adding that both Czech and European grants are connected with science and research.
Russia is striving for a competitive advantage at the expense of the Czech Republic and the European Union and it also wants both the Czech Republic and the EU to fund Russian activities, BIS adds.
($1=23.922 crowns)

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