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. Last Updated: 07/27/2016

Tax Authorities Raid Sobinbank's Offices




Moscow city police and tax authorities have carried out a search of Sobinbank, a Russian bank whose name has surfaced in connection with a probe by U.S. authorities into possible money laundering through the Bank of New York.


Police did not comment on the reason for the Tuesday search, but a Sobinbank official said the search warrant authorized the seizure of documents related to Flamingo Bank, which Russian authorities say they are investigating on suspicion of money laundering.


"For some unclear reasons, the investigators decided that Sobinbank has something to do with this money," Andrei Serebrennikov, deputy chairman of Sobinbank's board of directors, was quoted as saying by Kommersant newspaper in Wednesday's edition. "We are working with them only on the interbank market."


Police asked bank officials to open safe-deposit boxes, but the officials refused, Serebrennikov said. He said that the police withdrew late at night withou t breaking open the boxes following the arrival of television cameras at the bank's offices on Povarskaya Ulitsa, just off the Garden Ring. An ORT television crew was detained for several hours by police, who said they refused an order to stop filming and leave the area.


Last month, The New York Times reported that the formal investigation into Russian money laundering through the Bank of New York was launched after a $300,000 ransom payment for a kidnapped Moscow lawyer was traced passing through accounts at the Bank of New York and ending up at Sobinbank.


Sobinbank was not accused of any wrongdoing. But Tax Minister Alexander Pochinok said his ministry was compelled to check all Russian banks that did business with the Bank of New York.


Sobinbank services government accounts, including some State Customs Committee accounts and accounts of government agricultural programs, and is one of Russia's 20 largest banks. It has close relations with Moscow Mayor Yury Luzhkov, who has recently been feuding with the Kremlin. The city-controlled company that owns the Manezh shopping center is a 20 percent stakeholder in Sobinbank. RKK Energia, a producer of booster rockets, owns another 20 percent and oil giant LUKoil is also a shareholder. The bank has also made loans to Moscow.


The bank was set up with the participation of five major Russian banks - Moskovsky Delovoy Mir, Bank Imperial, SBS-Agro, National Reserve Bank and Bank Rossiisky Credit, Margot Jacobs, a banking analyst with the United Financial Group, said.


"It seems very difficult to work out whether law enforcers are after somebody specific or whether the raid is the result of several powerful groups in the shareholder body coming into conflict," Jacobs said.