US charges Russian billionaire Tinkov with tax fraud
Russian billionaire Oleg Tinkov has been formally charged with tax fraud for allegedly filing false tax returns.
Tinkov stands accused of concealing $1bn in assets and income from the US tax authorities at the time when he renounced his US citizenship in 2013, which required him to report his assets following a stock market flotation in London, the Department of Justice said.
He was arrested in London last month on a provisional warrant at the request of the US on charges brought by prosecutors for the US attorney's office for the northern district of California.
The 52-year-old Russian billionaire first appeared in Westminster magistrates last week, accused by the US Internal Revenue Service (IRS) of filing a false tax return in 2013 when he allegedly under-reported his income as a US citizen. The hearing is expected to last until April.
Tinkov paid a £20m bail to be allowed to stay in a apartment owned by his wife in central London so long as he respects a 7pm to 7am curfew. He faces an airport ban and must stay within the M25 motorway that surrounds London. He has had to surrender his passports and has to report to police three times a week.
The prosecutors said in a statement announcing the indictment: "Tinkov's decision to renounce his citizenship was a taxable event requiring him to report to the IRS the constructive sale of his worldwide assets, report the gain on the constructive sale of those assets to the IRS, and pay tax on such gain to the IRS."
Instead, prosecutors claim, Tinkov filed two statements to the IRS that reported his income at $206,000 and his net worth at $300,000 — despite owning more than $1bn in TCS shares through a series of companies registered in the British Virgin Islands. If extradited and convicted, Tinkov faces up to six years in prison.
Shares in TCS, the London-listed parent company of Russian online bank Tinkoff, slid by as much as third after the indictment charges were revealed and Tinkov's announcement that he was undergoing chemotherapy for acute leukaemia after being diagnosed last October.
TCS is the parent company of Tinkoff Bank, a pioneer of online banking technology with more than 10 million customers in Russia and the country's second-largest credit card issuer after market leader Sberbank.
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