US government targets Liechtenstein

The 82-meter-long yacht named "Graceful" is said to belong to Russian President Vladimir Putin and was still moored in the port of Hamburg about a year ago. The company Sequoia concealed its ownership.

Trustees in the principality concealed and managed the assets of Russian oligarchs. Vladimir Putin also used their services. Now the first trustee has landed on a US sanctions list.

Liechtenstein joined the international sanctions against Russia even faster than Switzerland, which has close ties to the principality . Not everyone there was happy about this; least of all the trustees who have long been willing to serve wealthy and dubious Russian clients. Trustees have been implicated in virtually every Liechtenstein illicit funds and money laundering scandal of the past. And for months, one case after another has been coming to light in which trustees from the principality helped Russian oligarchs, and presumably even Vladimir Putin himself, conceal foreign assets.

Now, for the first time, the US government has placed a Liechtenstein trustee, along with one of his employees and a broker active in customer acquisition, on its sanctions list. The focus is on Sequoia Treuhand Trust, a company based in the municipality of Ruggell. The sanctions authority, OFAC, affiliated with the US Treasury Department, accuses it of close business ties with the inner circle of Russian leader Vladimir Putin, including his friend and confidant Gennady Timchenko, with whom Putin shares more than just a passion for ice hockey and judo. Experts estimate Timchenko and his family's fortune at $18.5 billion.

He used the services of the Ruggell-based trustee, as did Alisher Usmanov. OFAC accuses Sequoia of "managing luxury real estate associated with the oligarch." Usmanov is considered one of the richest men in Russia and also a personal friend of Putin. His name has been on Western sanctions lists since 2022. Usmanov's and Timchenko's names are also on the Liechtenstein sanctions list, which is why authorities there are now investigating whether the trust company violated it. In an initial statement published in the Vaduz newspaper Vaterland , the company expressed surprise and ignorance: "We are doing everything in our power to clarify as quickly as possible why the sanctions were imposed."

So far, the authorities have not been noticed for taking harsh action against trustees

Sequoia – the name is based on a species of sequoia tree, which is considered particularly robust and stable – has been implicated in dubious Russian business dealings for the first time. The company is also allegedly involved in a scheme that used an offshore company to conceal Vladimir Putin as the actual owner of an ocean-going yacht called Graceful . The ship, valued at $150 million, was anchored in Hamburg before disappearing from there immediately before Russia's attack on Ukraine. The ownership structure was disguised by a convoluted offshore scheme; a specialty of Liechtenstein trustees. A Panamanian company plays a role in this, in which the Sequoia operator was at least involved. It is important to note: When Liechtenstein began to weaken banking secrecy for foreign clients, many trustees exported their questionable business models to Panama – and exploited them via this detour. Within Liechtenstein, trustees are considered the biggest obstacles to the "white money strategy" proclaimed by the government and the Princely House, according to which the Liechtenstein financial center aims to become clean according to international standards.

Not only Sequoia, but also other Liechtenstein trustees have numerous Russian billionaires in their client files who have fallen into disrepute in connection with the Ukraine war. Due to its lack of glamour, the small country in the upper Rhine Valley has never been a meeting place for the Russian jet set like relevant hotspots in Switzerland or Austria. Russians also do not own villas or other real estate in Liechtenstein. Rather, they use the principality to organize their international business and conduct it anonymously from there. The question of whether sanctions are being circumvented in this process is becoming increasingly pressing.

The case of the yacht Luna, which was confiscated in Hamburg after the outbreak of the Ukraine war, attracted attention. It is registered to a company in Liechtenstein and managed by a trustee in Schaan. Behind it stands Farkhad Akhmedov, a billionaire and Putin ally. Igor Shuvalov, former Russian Deputy Prime Minister and head of the state-owned Bank for Foreign Trade, also concealed his luxury estate, the "Waldschlössl," on Lake Attersee in Austria with the help of Liechtenstein trustees and shell companies. This is a generally popular practice among Russians seeking to conceal their Western real estate holdings. Another oligarch's son, who owns Tuscan villas through Liechtenstein companies and trustees, was also aware of this. So far, the Liechtenstein authorities have not been noted for taking harsh action against trustees. Instead, they boast of having frozen a good 250 million euros. This could only be part of the truth.