OCCRP profiled that mysterious group in our multi-part project "The Proxy Platform," published in November, 2011.
Our investigation showed that organized crime groups (including government officials) from all over the world use the same offshore registration companies to launder money changing hands through kick-backs, trafficking, or tax evasion.
The system is built on hundreds of phantom companies, which exist only on paper and appear to be run by common people, but in fact those named representatives are simply proxies. Many aren't even aware that their names are being used in company documents.
In his interview, Ignatiev also explained the phenomenon of “one-day firms”, which are created simply to funnel money and then dissolved before they pay any taxes.
The same schemes are behind the vanished "Magnitsky Money," which OCCRP has also covered in detail. Sergei Magnitsky was a Russian lawyer and accountant who blew the whistle on Russian officials who stole $230 million in tax proceeds from the state and laundered it through a web of phantom companies and offshore accounts. When he exposed the crime, Magnitsky was arrested and charged with the fraud he uncovered, and he died while imprisoned on those charges.
“What Magnitsky was looking into – that was the tip of the iceberg,” said a Moscow economist quoted in the Financial Times report of the interview.
Ignatiev appeared to blame weak law enforcement in Russia for its runaway shadow economy, saying “In the event of a serious concentration of effort by the . . . agencies, I think such people, and the beneficiaries of such operations, could be found.” But, the Financial Times noted, careful enforcement in Russia can be "hazardous to one's health": in 2006, Ignatiev's then-deputy Andrei Kozlov was shot dead after launching a crusade to clean up the banking sector. His successor resigned suddenly and mysteriously in September, 2011.
