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. Last Updated: 07/27/2016

Geneva Police Target Russian Mafia

GENEVA -- Police in Geneva, a tranquil and secretive haven for offshore wealth, are hunting for Russia's feared mafia after the arrest of a Russian on charges of money-laundering, the city's public prosecutor said Friday.


Jean-Louis Crochet said police investigations were launched after the arrest of Sergei Mikhailov, a 38-year-old Russian living in Switzerland, at Geneva's airport Oct. 16 on charges of criminal links and money-laundering.


A Geneva court extended the Russian's detention for three months Friday.


"We're hunting for the Russian mafia. We have many people investigating their connections," said Crochet, but he would not give details.


The Swiss news agency ATS said authorities had blocked the bank accounts of Mikhailov, who had been living with his wife and two children in a villa to the west of Geneva and had three passports -- Russian, Israeli and Costa Rican.


Other charges against him included violation of Swiss laws on purchases of property and real estate by foreigners and violation of regulations governing foreign nationals in the country.


ATS did not say where Mikhailov's accounts were held.


Earlier, the agency quoted Crochet as saying the judicial authorities were "paying special attention to the installation of Russians in Switzerland."


"It does not want the Russian underworld to use Geneva's financial centers and invest in our economy," he added, according to the agency.


Banking sources say Russian deposits at Swiss banks have more than doubled to over $3 billion in the past years and, with capital flight from Russia running at hundreds of millions of dollars every month, are likely to increase further.


Some Swiss banks have a blanket policy of not accepting any Russian clients, while others have established centralized units to deal with Russians, banking sources say.


Some banks have a so-called "white gloves" policy to detect money whose origins might be suspicious.