Fiji grants US a warrant to seize Russian billionaire’s megayacht

The case high­lights the legal dif­fi­cul­ties Western gov­ern­ments may face as they attempt to seize assets tied to Russian tycoons who enabled the Ukraine invasion

Fiji’s High Court has giv­en the green light for US and local author­i­ties to seize a $325m megay­acht whose own­er­ship is in dis­pute, set­ting the stage for a legal show­down to deter­mine whether the lux­u­ry vessel’s own­er is sanc­tioned Russian gold bil­lion­aire Suleiman Kerimov as the US claims.

Counsel rep­re­sent­ing the reg­is­tered own­er of the megay­acht have applied for a tem­po­rary stay of the Suva high court’s rul­ing on Tuesday 3 May that allowed for the seizure of the Amadea supery­acht and a reg­is­tra­tion of the US war­rant to seize the ves­sel, accord­ing to Fiji’s Office of the Director of Public Prosecutions (ODPP). A Fijian court had ear­li­er ordered that the megay­acht be detained and pre­vent­ed from leav­ing the ter­ri­to­ry while author­i­ties worked with US officials. 

The case high­lights the legal dif­fi­cul­ties the US and oth­er Western gov­ern­ments may face as they attempt to seize and sell megay­achts and oth­er lux­u­ry assets tied to Russian tycoons they say enabled Putin’s February inva­sion of Ukraine. The US, UK and EU have levied sanc­tions on oli­garchs and those accused of enabling Moscow’s war in Ukraine, and Western gov­ern­ments are pur­su­ing their yachts, planes and villas. 

A lawyer rep­re­sent­ing the com­pa­ny that the ves­sel is reg­is­tered under said the supery­acht is owned by anoth­er tycoon who is not on sanc­tions lists. Kerimov was sanc­tioned by the UK and the EU in March for his close ties to Russian President Vladimir Putin. He was on the US sanc­tions list in 2018.

‘Ill-gotten gains’

The seizure comes as US Senate major­i­ty leader Chuck Schumer said he wants leg­is­la­tion to expand for­fei­ture laws to seize Russian oli­garchs’ “ill-got­ten gains” and use the pro­ceeds to help Ukraine. A bill on aid for Ukraine could reach the floor as soon as next week. 

The Amadea, which fea­tures a heli­pad and mosa­ic-tiled pool, arrived in the Fijian port of Lautoka on April 12 after an 18-day jour­ney from Mexico, data com­piled by Bloomberg show. Fiji detained the 348-foot-long supery­acht on April 19 after it received a for­mal request for mutu­al legal assis­tance from the US gov­ern­ment, accord­ing to the pub­lic pros­e­cu­tions office. 

In the pro­ceed­ings, Fijian lawyer Feizal Haniff says Millemarin Investments is the legal own­er of the Cayman Islands-flagged Amadea. The US alleges the ben­e­fi­cial own­er of the ves­sel is Kerimov. The issue of own­er­ship is like­ly to be decid­ed lat­er in a US court, accord­ing to the pub­lic pros­e­cu­tions office. Haniff didn’t imme­di­ate­ly respond to requests for comment. 

Local media have report­ed that coun­sel for the defence has said the supery­acht belongs to Eduard Khudainatov, the for­mer chair­man and CEO of Rosneft Oil, a Russian state-con­trolled oil and gas com­pa­ny. Khudainatov does not appear to be on sanc­tions lists. 

The high court gave the country’s direc­tor of pub­lic pros­e­cu­tions until May 5 to file a response to Millemarin’s appli­ca­tion to the court for an inter­im stay to hold off the exe­cu­tion of the court’s orders pend­ing an appeal, accord­ing to the pub­lic pros­e­cu­tions office. The court will make a deci­sion on the stay appli­ca­tion by May 6. 

We con­tin­ue to ratch­et up the pres­sure on Putin’s oli­garchs and we are work­ing with allies and part­ners to go after cor­rupt gains from some of the indi­vid­u­als clos­est to Putin

-US Embassy statement.

If seized, the Amadea will be among more than a dozen mul­ti­mil­lion dol­lar megay­achts round­ed up by Western gov­ern­ments to pun­ish tycoons with close ties to Putin. 

“We have imposed sanc­tions on Russian oli­garchs who are financ­ing Putin’s war and we will con­tin­ue to act with our allies and part­ners around the world in impos­ing costs on the Kremlin if it con­tin­ues its war of choice,” the US Embassy in Fiji said in a state­ment. “We con­tin­ue to ratch­et up the pres­sure on Putin’s oli­garchs and we are work­ing with allies and part­ners to go after cor­rupt gains from some of the indi­vid­u­als clos­est to Putin, no mat­ter where they are held around the world.”

Germany has impound­ed Russian bil­lion­aire Alisher Usmanov’s supery­acht Dilbar, val­ued at as much as $750m. Italian author­i­ties arrest­ed a $578m ves­sel owned by Russian bil­lion­aire Andrey Melnichenko, while Spain seized Viktor Vekselberg’s $90m Tango as well as the $600m Crescent believed to belong to Igor Sechin, head of Moscow-based Rosneft. 

Kerimov is worth about $14.4bn, accord­ing to the Bloomberg Billionaires Index. His fam­i­ly holds a 46% stake in Polyus, the biggest gold pro­duc­er in Russia. The US placed Kerimov on its sanc­tions list in 2018 for being an offi­cial of the gov­ern­ment of the Russian Federation. Meanwhile, French pros­e­cu­tors had accused him of laun­der­ing mon­ey obtained via tax fraud in deals to buy four vil­las on the Côte d’Azur worth hun­dreds of mil­lions of euros. He beat mon­ey-laun­der­ing charges in France in 2018. 

Fiji baffled by megayacht’s arrival

Authorities in Fiji were report­ed­ly baf­fled by the Amadea’s arrival, because it hadn’t sought the nec­es­sary per­mits, local media said at the time. The Fiji Revenue & Customs Service (FRCS) issued two infringe­ment notices to the cap­tain for fail­ure to com­ply with arrival and dis­em­barka­tion pro­ce­dures, accord­ing to the Fiji Times.

The actions by the US and its allies have scat­tered Russian yachts to locales per­ceived as less like­ly to seize the plea­sure crafts, includ­ing parts of the Middle East and the Caribbean, accord­ing to space-based ana­lyt­ics and data firm Spire Global. Megayachts owned by Russians account for as much as 10% of the glob­al fleet, accord­ing to indus­try watch­er The Super Yacht Group.

Original source of arti­cle: www.businesslive.co.za