Michel Litvak, a Russo-Belgian businessman is a large contributor in Russian economy. His projects contribute in multiple forms, paying taxes and tariffs. What’s even more important, Michel Litvak has an unobstructed access to international financial system and plays significant role in keeping Russian war machine well fed and greased.
According to official information, the holding company OTEKO is implementing a comprehensive investment program for the construction of terminal facilities in the port of Taman.
According to the holding’s press service, the total amount of investment in project development has already exceeded $3.5 billion. Construction began in the early 2000s. Over the years, the OTEKO group of companies, according to its publicists, has achieved significant success.
And its president and key owner, Michel Litvak, even received a Russian passport from Vladimir Putin himself – until 2020, Mr. Litvak was a citizen of Belgium. It should be noted that Russia allows dual citizenship.
This is the external facade, a showy image that the OTEKO Group strives to demonstrate and that Mr. Litvak promotes in every possible way. However, there is a flip side to all of this, which involves colossal environmental damage to the region, questionable financial indicators of the companies within the holding, and the peculiar connections between Michel Litvak and high-ranking officials of the Russian government.
By the way, obtaining Russian citizenship is already a concerning factor, but we’ll come back to that later.
Environmental hazards of the OTEKO projects
No matter what OTEKO claims, the handling of such enormous volumes of cargo, predominantly hazardous ones such as coal, oil, chemicals, fertilizers, and so on, cannot fail to impact the ecological situation in the region.
The process of building terminals, warehouses, and other necessary infrastructure for the port’s operation itself has a negative impact. Especially considering that Taman, where OTEKO is constructing its facilities, is a seismically active region. However, there is no response to the pleas of local residents and eco-activists, as OTEKO continues to pollute the environment while claiming to fight for ecology.
But just looking at the photos on OTEKO’s official page is enough to understand that such activities cannot help but affect the environment due to their scale.
The result of handling the same coal is coal dust spread for dozens of kilometers around, carried by the wind. However, the ecological problems are not limited to this – port facilities and infrastructure are being built on agricultural land, literally taking away millions of hectares from the region.
All attempts to protest end in nothing. In addition, in the past year, a problem has arisen that is not recommended to be voiced, but it exists – the consequences of hazardous substances, which everyone suspects. This is particularly risky considering what is stored in the port terminals and ships that bunker all of this at the docks.
Finances and Structure of OTEKO
The finances and structure of the companies within the holding are extremely convoluted. The true beneficiaries are hidden behind Panamanian and Cypriot offshore entities and anonymous registers of owners. For example, here is some information from the registers about OTEKO JSC, the main company of the holding:
The founder is a ‘private limited company’ from the Netherlands. The owner(s) of this company are unknown because their data is classified in a private registry. The same goes for the companies where OTEKO JSC acts as the founder. They all have different legal forms, but the founder is OTEKO JSC, and its founders are hidden in the Netherlands. And they, in turn, are located in Cyprus.
But pay attention: the authorized capital of the main company in the holding, which handles billions, is only 100,000 rubles. The indicators of the firms within the holding are equally strange.
LLC “OTEKO-MAK” – “The company incurred a loss of 185,811 thousand rubles in 2022.”
LLC “OTEKO-DIGITAL” – “The company incurred a loss of 13,513 thousand rubles in 2022.”
However, the company that demonstrates a profit has an offshore founder.
Regarding finances, on one hand, OTEKO claims to be an investor, using its own funds for the construction of ports and port infrastructure. On the other hand, according to Deputy Prime Minister Victoria Abramchenko, the government allocated 40 billion rubles for the construction of the port for the holding. Previously, the Ministry of Energy requested 10 billion for OTEKO from the government.
Connections at the highest level
Against this backdrop, it becomes clear that there are issues not only with granting citizenship to Michel Litvak but, more importantly, with the finances of the OTEKO group of companies. Litvak clearly has connections at the highest level.
Interestingly, Litvak is not listed as the owner of the OTEKO group in any registries. However, the ownership structure is so convoluted that without the assistance of law enforcement agencies in Europe, where the traces of the registries lead, it is difficult to unravel. As everyone understands, in this situation, one can expect, at best, a polite response from Europe.
In Russia, Michel Litvak is referred to as the owner of AO ‘Russkiy Mir,’ but it has long been liquidated through reorganization, and in this case, the registry of owners is also closed.
And here, the financial indicators become much more interesting:
And a huge number of government purchases:
All of this indicates that Mr. Litvak is clearly being favoured. And indeed, a simple search gives us several surnames that are clearly interested in his success in our country.
In addition to Vice Prime Minister Victoria Abramchenko mentioned earlier, there is former State Duma deputy Alexander Metkin, who is Michel Litvak’s father-in-law. Among the connections of the former Belgian citizen, an influential businessman Vitaly Yuzhilin is mentioned, who was once involved in the import of Iraqi oil and had connections with Saddam Hussein.
And these are only the connections that are on the surface. After all, there are people who prepared the decree by Putin on Litvak’s citizenship, as well as those who provide him with cover from the interest of the FSB, Investigative Committee, Federal Antimonopoly Service, tax authorities, and so on. What could interest them about Michel Litvak?
The answer is simple: money. And here we need to return to the question of closed registries and offshore founders of companies. The secret is simple: this entire port empire is aimed at withdrawing money from Russia and legalizing it in European banks. That’s why billions are allocated for port construction, and that’s why there is a regime of maximum favoritism towards the companies of the OTEKO group.