Moscow businessman Konstantin Malofeev is accused of violating US sanctions against Russia, according to a 21-page indictment from a New York court dated Wednesday, April 6.
This is the first legal case against a Russian oligarch in the United States since the invasion of Ukraine began on February 24.
Konstantin Malofeev, an investor and staunch supporter of Russian President Vladimir Putin, is accused of trying to get his hands on $10 million in frozen American assets, with the help of his American employee, Jack Hanick, ex-director of the American conservative television channel Fox News and support of Donald Trump.
The indictment details how Konstantin Malofeev, a Russian nationalist and founder of the Orthodox television channel Tsargrad TV, tried to evade US sanctions.
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Konstantin Malofeev was sanctioned in 2014 by the US Treasury for financing Russians who supported separatism in Crimea.
Although the sanctions prevented him from doing business with US citizens, prosecutors say Konstantin Malofeev circumvented those restrictions by recruiting Jack Hanick to work for him in networks in Russia and Greece.
According to the judges, he would have asked for the help of the American to try to acquire a television channel in Bulgaria.
It was all part of a strategy to spread pro-Russian propaganda across Europe, according to the US Department of Justice.
"Our eyes are fixed on every piece of art, every piece of real estate bought with dirty money, and every bitcoin wallet filled with the proceeds of theft or other crimes," Deputy Attorney General Lisa Monaco warned. announcing, on Wednesday, the latest US sanctions against Russia.
For his part, Jack Hanick, who notably helped launch Fox News, was arrested in London last month and is awaiting extradition.
Jack Hanick was prepared, according to the indictment, to "implement" the "vision" of his Russian employer at the television station that hired him, Tsargrad TV.
Because the ex-director of Fox News was in phase with the conservatism of Konstantin Malofeev.
On the night Donald Trump won the 2016 election, Jack Hanick was in Moscow at a pro-Republican party where organizers unveiled a huge portrait of the winner of the US presidential election, according to US magazine Rolling Stone.
"America was founded on Christian principles and now America is moving away from Christianity," Jack Hanick said at the event in an interview posted on YouTube.
Sitting next to the newly unveiled portrait of Donald Trump, Jack Hanick claimed that "America was losing its moral core and fiber. Now Russia, on the other hand, is opening its arms to orthodox Christianity."
Jack Hanick at a Republican Party party in Moscow in 2016. © Screengrab YouTube
An investment banker who says he "found God" during his university studies, Konstantin Malofeev is a devout Orthodox Christian in a country which, under Putin, abandoned communism for the Christian Church.
Since then, the Kremlin and the Moscow Patriarchate have been operating in synergy aimed at Russian renewal.
Founder of the investment fund Marshall Capital Partners, Konstantin Malofeyev [sometimes written Malofeyev] used his religious contacts to increase his fortune, investing in the Russian telecommunications giant, Rostelecom, while Igor Shchegolev, his Orthodox friend, was minister Telecommunications, according to the Financial Times.
In 2015, when he launched Tsargrad TV – thanks to the experience of Jack Hanick at Fox News – the new Russian Orthodox channel also began broadcasting daily on Spas, a religious channel run by the Orthodox Church.
From Moscow to Athens with a doctored share certificate
It was after the successful launch of the TV channel that Konstantin Malofeev commissioned Jack Hanick to create a TV channel in Greece and acquire a Bulgarian channel.
According to the indictment, the duo colluded to illegally transfer $10 million frozen in a Texas investment bank to an accomplice in Greece, violating US sanctions passed shortly after annexation from Crimea.
Earlier this week Konstantin Malofeev denied the accusations in an interview with the Financial Times.
He insisted he hadn't held any assets in the US since 2014 and dismissed the lawsuit against him, calling it "comical".
However, according to US prosecutors, a share certificate [a legal document that certifies the purchase of shares in a company] relating to Konstantin Malofeev's funds - accessed through a front company in Seychelles - was fraudulently backdated to make it look like it was issued in June 2014, before the sanctions were imposed.
The indictment details a 2015 trip by Jack Hanick from Moscow to Athens, during which he transported the stock certificate and transferred the funds to a Greek associate for just one dollar.
This case is still ongoing.
The "will of God" in Crimea
Konstantin Malofeev is, moreover, an assumed royalist who considers Crimea as an intrinsic part of the Russian Empire, which Vladimir Putin seeks to revive.
According to the oligarch's own account, his obsession with Crimea began in January 2014, a few months before the arrival of Russian soldiers, when Konstantin Malofeev was traveling in Russia with the Russian patriarch.
Konstantin Malofeev had taken with him ancient Christian relics.
Crimea, according to the Russian oligarch, was not on the program of the trip.
But when they stopped in Crimea's capital, Sevastopol - which has a population of around 100,000 - a third of the local population gathered to pray with the relics.
"All the inhabitants made only one prayer: that Sevastopol becomes part of Russia again. It is the will of God", declared in 2014, Konstantin Malofeev, to the Financial Times.
When Crimea was annexed to Russia – this annexation was not recognized by the international community – Konstantin Malofeev was immediately placed on the American and European lists of sanctioned persons.
The Puy du Fou project in Crimea
But EU sanctions haven't stopped some from continuing to do business with Konstantin Malofeev.
This is the case of the founder of Puy du Fou, Philippe de Villiers, a politician, Catholic aristocrat, royalist and eurosceptic convinced, endowed with a keen sense of business.
Konstantin Malofeev, an ultra-Orthodox Russian oligarch and monarchist, saw in him a perfect ideological partner.
In August 2014, just weeks after the EU imposed sanctions on Konstantin Malofeev, Philippe de Villiers announced that he had reached an agreement with the Russian oligarch to build a historic theme park in Crimea.
The announcement was made during Philippe de Villiers' trip to Russia, where he met Vladimir Putin at Livadia Palace, the summer residence of Russian tsars, in the Crimean resort town of Yalta.
"What a statesman!" exclaimed Philippe de Villiers the next day on Twitter.
Yesterday I was received by Vladimir Putin in Yalta.
An unforgettable encounter.
What a statesman.. @KremlinRussia_E pic.twitter.com/WZpQbrH8x6
— Philippe de Villiers (@PhdeVilliers) August 15, 2014
Philippe de Villiers, twice presidential candidate, comes from an aristocratic family, the Le Jolis de Villiers de Saintignon family.
She has a military heritage – her brother, General Pierre de Villiers, is a former chief of staff.
And they did pretty well in business.
Some historians may accuse the Puy du Fou of conveying historical errors and a "reactionary and ultra-Catholic" vision of the world, the Puy du Fou is the second most visited theme park in France, after Disneyland.
Philippe de Villiers also created a local radio station, Alouette.
His brother Bertrand is the CEO.
Despite the abandonment of the park project, monarchist dreams persist
In August 2014, the administration of Crimea, supported by Moscow, indicated that Philippe de Villiers, Konstantin Malofeev and Sergei Axionov, the head of the government of Crimea, had signed a memorandum of understanding.
This provided that the company Puy du Fou International of Philippe de Villiers, as well as Konstantin Malofeev, would invest at least 4 billion rubles (110 million dollars) in the park in Crimea.
The new project has been named the Puy du Fou Tsargrad.
"Our project will promote the history of Crimea as a long part of Russian history," added Philippe de Villiers.
Despite the rejection of EU sanctions by Philippe de Villiers, this theme park dream in Crimea ultimately did not materialize.
Experts blasted the deal from the start of the project.
A foreign lawyer in Moscow told the Financial Times that there was "no chance" that the project could be carried out, because of European sanctions.
Since it was only a memorandum of understanding, without any evidence of financial transactions, the lawyer explained that Philippe de Villiers was not yet at risk of legal consequences.
"It's just a gigantic publicity stunt," he said.
According to a Russia specialist interviewed in 2014 by the daily Ouest-France, the sanctions at that time only targeted Russians doing business in Europe and not Europeans doing business with Russia or exporting to Russia.
"It is legal, but very frowned upon, in the current context, to trade with Russia", explained Jean Geronimo.
Puy du Fou artistic director Nicolas de Villiers confirmed that his father's plans in Crimea had failed.
"President Putin imagined a Puy du Fou in Crimea. But economic sanctions against Russia prevent us from considering such a project," he told Capital magazine in 2019.
The youngest son of Philippe de Villiers added that he was already "well loaded" with the group's international projects in Spain and China.
“There is no question of having eyes bigger than your stomach”, he underlined.
The tightening of sanctions, following the Russian invasion of Ukraine, seems to have prevented Konstantin Malofeev from promoting his Christian, far-right and ultra-conservative values on both sides of the Atlantic.
This context has also prompted scrutiny of the links between far-right figures in France and Vladimir Putin.
Konstantin Malofeev's international plans may have stalled, but the oligarch still has big plans for his native Russia.
In a 2020 interview with The New York Times, he welcomed Vladimir Putin's decision to give himself two additional terms of six years each, after his current term ends in 2024.
Russia is now "a quasi-monarchy" for Konstantin Malofeev, which he says is "a very good thing".
But the 47-year-old oligarch projects himself even more.
"It's not the end," he said.
"The introduction of a constitutional monarchy in the foreseeable future – for example, after Putin's reign in 2036 – has become realistic."
Article translated from English by Tiffany Fillon. The original can be read here.
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