Peters & Peters’ Client Alexander Tugushev Allegedly Involved in Fraud and Money Laundering

It’s been a year since Yulia Vasilkina, a Russian lawyer, has been trying to reach the London’s law firm Peters & Peters Solicitors LLC in an attempt to clarify the whereabouts of their client, former Russian government official Alexander Tugushev. The latter was put on the international wanted list in March last year as a suspect in a large-scale fraud case.

In the materials of the criminal case file it is asserted that Tugushev offered a Murmansk businessman, Alexander Sychev, to join a certain project. This happened before Tugushev fled to London. As a result, Tugushev received 41 million roubles from Sychev to finance said project. Yet the business venture never took up, and the money disappeared with Tugushev. The latter was subsequently charged with large-scale fraud in absentia.

“The preliminary investigatory bodies charged person T., who is on the international wanted list, with a particularly large-scale theft by deception of money belonging to person S. (part 4, article 159 of the Criminal Code),” said court spokeswoman Inna Zhelonkina.

Whatever happened to the stolen 41 million roubles is still a mystery. The same can be said about the $3.7 million, which Tugushev received as a bribe from fishing company Pollucks. In return he promised them fishing quotas. Kommersant wrote at the time in 2007 that the court sentenced Tugushev to six years for this crime; however, the investigators failed to discover where the money went. It is strongly suspected that the money has followed Tugushev to the UK through a series of offshores and sham deals.

Tugushev’s journey to Britain was also a tricky one: his criminal past would have prevented him from ever obtaining a visa, but he eventually managed to convince the immigration authorities that he was an innocent victim of political persecution and thus got his visa approved. A notice penned by his lawyers and sent to the British Foreign Office emphasised that the criminal case against him for extorting money from Pollucks in 2004 was “politically motivated”.

Tugushev found his bearings in the UK pretty quickly. With the help of his solicitors from Peters & Peters, he initiated a lawsuit against his former partners, Magnus Roth and Vitaly Orlov.

Russian lawyer Yulia Vasilkina, who represents Tugushev’s fraud victim, Sychev, reasonably suspects that the litigation in the High Court of London with Tugushev’s former partners may be funded with the money that belonged to her client. This in itself is a breach of law, not to mention the enormous damage it inflicts on the image of the British justice system.

The London representative of Tugushev is Mr. Keith Oliver of Peters & Peters Solicitors LLP. For the past year, Yulia Vasilkina has been trying to reach Tugushev’s solicitor in London: numerous attempts have been made to get him to help her trace the money stolen from Sychev.

In May 2020, Vasilkina mailed to Oliver her first request that listed all facts and arguments. “We ask that the evidence and information set out in this notice be taken into account in the proceedings in the High Court in London against Mr. Vitaly Orlov, Mr. Magnus Roth, Mr. Andrei Petrik, and provide all possible assistance in recovering the money stolen by A.I. Tugushev,” she wrote.

She got no reply from London. Vasilkina mailed a second notice to Oliver a month later, asking him to let her know of Tugushev’s whereabouts. The solicitor of the ex-government official seemingly also ignored her second request.

Yulia Vasilkina requested that Oliver confirm or deny the fact that Alexander Tugushev was based in London. “The establishment of Tugushev’s whereabouts is necessary to remove obstacles that prevent justice to be served in the Russian Federation and to recover the damages caused by Tugushev’s crime,” emphasised Sychev’s representative.

In September 2020 a third notice followed. Still no reply. So far the solicitors representing Tugushev have ignored each and every attempt made by Vasilkina to alert them to a fact that the lawsuit in London with Magnus Roth and Vitaly Orlov might be funded with the money stolen from Sychev. That said, financing a litigation with the money received through criminal activity constitutes an act of money laundering as defined by British law.

This is not the first instance signifying that the litigation around Norebo may involve money-laundering activity that Oliver should be aware of. “In this trial, Tugushev looks like no more than a ‘frontman’ — or perhaps a hostage in a group with not one, but two false bottoms – ‘delegates from the criminal world’, bogus lords and dubious intermediaries,” reported Novye Izvestia.

Managing partner of law firm Dukhina and Partners, lawyer Ekaterina Dukhina, clarified what rules the British legal professionals have set for themselves:

“In 2005, the English court ruling in Bowman v Fels [2005] EWCA Civ 226 lowered the standards for checking the origin of funds in cases involving dispute resolution. Accordingly, it is now virtually impossible to charge dispute resolution lawyers with a failure to comply with the requirements to establish the provenance of funds under section 328 of the Proceeds of Crime Act 2002 or with money laundering. However, lawyers engaged in transactional work must meet higher requirements to verify the origin of the funds. There is clearly a double standard.

Unfortunately, English law and the Solicitors Code of Conduct have no rules that would oblige Oliver to respond to requests from third parties, whether from Russia or any other country. All of Oliver’s obligations are solely to his client or the court. Accordingly, Tugushev must have been informed of Vasilkina’s request, but most likely he instructed Oliver not to respond to those requests. Therefore, Oliver is not responsible for ignoring Vasilkina’s requests in the absence of a court order.”

We sought comment directly from Mr. Oliver. We asked him whether he had received the requests from Vasilkina, and if so, why he ignored them and whether he knew the origins where his client’s money came from. Unfortunately, at the time of publication we have not yet received a reply. We are ready to accommodate any response from Mr. Oliver and his client Aleksander Tugushev.

Andrew Mcaffrey
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