London is the world’s leading financial centre, ahead of New York, Hong Kong, Shanghai and Singapore, according to the global financial centres index published last month (May 2019). The Report compiled by think tank Z/Yen, shows London leading the pack of 110 cities analysed for international rankings – writes James Wilson.
The ranking is based on 103 separate factors and draws on data from the World Bank, the United Nations and the OECD, as well as the survey responses of more than 2,300 financiers from around the world.
But a key factor that also needs to be taken into account in making any such a comparative analysis is the regulatory environment and the effectiveness of enforcement against fraud.
Because with global fame for an international financial centre also comes the unfortunate but inevitable corollary of attracting unscrupulous and unwelcome operators from the dark side, and financial centres have a global duty of care to protect their operators against criminal activity.
Take the case of businessman Alexander Mineev from Russia, who originally moved to London in 2015 for his own personal reasons to try and hide his assets from his former wife. Little could he have suspected that his business empire far from being protected by his professional advisers, was about to be kidnapped through a deliberate and ruthlessly planned sting and asset raid.
Mineev came from the “new Russian business” of the 1990s, and was a well-known businessman in Russia. He created the first electronics supermarket chain in Russia before his murder. He owned shopping centres in Moscow, warehouses, car dealerships, as well as real estate in different Russian regions. The estimated value of his assets was US $1 billion. The Hong Kong firm Crazy Dragon International Limited was the main holding company for his operations, and the primary beneficiary was Alexander Mineev.
In London, Mineev met an exiled Russian banker named Herman Gorbuntsov, who introduced him to his personal lawyer and friend Vadim Vedenin who offered to help him. Little could Mineev have suspected that his business empire far from being protected by his professional advisers, was about to be kidnapped through a deliberate and ruthlessly planned sting and asset raid.
It is even alleged by Moldovan politician and businessman Renato Usatii in an interview to the Russian daily Novaya Gazeta that the London based banker Herman Gorbuntsov began to prepare for the redistribution of Mineev’s assets, and the change of beneficiaries of his estate in advance of his untimely death.
“If he didn’t know that in a month and a week Mineev would be killed, why did he start preparing for the liquidation of his assets? Because, while Mineev was alive, there were no legal actions. I have terabytes of information about all the criminal activities of Gorbuntsov. throughout the period from 2013 to 2018. I am sure that the law enforcement agencies of the Russian Federation and other countries of the world where certain crimes were committed should be interested in this. There are a lot of them,” says Renato Usatii.
Alexander Mineev was shot by a Kalashnikov assault rifle in broad daylight in his own car in the city of Korolev in Russia. His murder is still unsolved, although there continue to be several lines of criminal investigation open.
Gorbuntsov used to own several banks in Russia and Moldova but has lived in the UK now for several years. He previously played an important role in financial affairs in Russia and Eastern Europe, and helped launder money for many high ranking officials.
He is a seasoned international fraudster whose fingerprints are to be found on the dossiers of many financial scandals over the past two decades. He rose to notoriety for the first time following the disappearance of approximately $1 billion from STB Bank in 2008-2009 which belonged to Russian Railways.
In 2011, a criminal fraud case was opened against Gorbuntsov in Russia about issuing fake bank bills. He fled to London to escape prosecution, losing his banking assets in the process. His creditors came after him, and in 2012 he was machine-gunned in a botched gangland style execution in London’s Docklands which left him fighting for his life.
He appeared to gain traction with international secret services as a trusted informer, and was subsequently named as a witness in many high-profile cases of fraud. In 2015, Russian investigators originally intended to interrogate Gorbuntsov in the case of the murder of opposition leader Boris Nemtsov.
He was mentioned in the investigation of the case of the attempted assassination of the banker Alexander Antonov, and also the case of Dmitry Zakharchenko who was detained and arrested in Moscow in September 2016 on corruption charges.
“We are dealing with a very experienced and resourceful swindler. He has repeatedly appeared in various cases and has come out dry,” according to Russian political analyst Zurab Todua.
So far, in this complex web of deceit with rivals, investigators and the fraud squad, Gorbuntsov has emerged as a survivor. He has consistently been able to create the impression that he is a valuable witness who knows a lot and can be extremely useful – now and in the future. This ruse has repeatedly saved him from prosecution so far. But he is sailing very close to the wind, and playing a dangerous game.
The jury is out on the value of the contribution his inside information, operational intelligence and hard experience can actually provide to the track record of important financial centres like London.