Sunday, May 22, 2022

Portuguese Rabbi arrested for helping Russian Oligarch Abramovich obtain Portuguese citizenship

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A global effort scrutinizing one of Russia’s richest men, Roman Abramovich, ricocheted outward, ensnaring a rabbi in Portugal, sowing confusion over the sales process of the billionaire’s British soccer team and freezing some of his U.S.-held funds.

Mr. Abramovich was sanctioned Thursday by U.K. authorities, who allege he received preferential treatment from Russian President Vladimir Putin. It was part of the latest salvo of restrictions and sanctions targeting Russian banks, exports and individuals in the wake of Russia’s invasion of Ukraine.

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Representatives for Mr. Abramovich didn’t return requests for comment.

A leading Portuguese rabbi who helped Mr. Abramovich obtain Portuguese citizenship was arrested on Thursday as part of a wider investigation in Portugal involving alleged influence-peddling, forgery, money laundering and tax fraud, according to people familiar with the case.

The rabbi, Daniel Litvak, oversees in Porto the process of certifying claims to Portuguese citizenship on the grounds of descent from Sephardic Jews, who were expelled from the Iberian Peninsula in the late 15th century.

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The Porto Jewish Community, the organization that issues the certificate, has said there is a “smear campaign” against it. Mr. Abramovich received his Portuguese citizenship last year. He also holds Israeli and Russian citizenship.

Mr. Abramovich’s sanctioning by the U.K. has also upended the sale of his soccer club Chelsea FC, a process he had initiated just before he made Britain’s target list. An initial deadline for offers for the club was set for Tuesday, but that process is now in disarray as advisers and people close to Mr. Abramovich try to determine how to move forward, according to people familiar with it.

The U.K. Treasury said Mr. Abramovich would need to apply for a license to exempt any sale of the club from the U.K. sanctions.

Chelsea executives, meanwhile, are lobbying the government to loosen some of the terms of a separate license the club was granted under which it can continue to operate, according to people familiar with the matter. One of those restrictions is a spending cap of £20,000, or about $26,000, for travel to away games. Chelsea’s next match, on Sunday, is at home.

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The U.K. sanctions have had other ripple effects in London, spawning a raft of rules that upend even routine transactions related to Mr. Abramovich’s properties, including blocking rent payments he owes Queen Elizabeth.

In the U.S., a number of hedge-fund firms that have investments from Mr. Abramovich have been told to freeze his assets, The Wall Street Journal previously reported. Mr. Abramovich had been trying to sell interests in funds on the secondary market since at least late February, the Journal reported.

U.K. agencies, like those of other governments including the U.S., have powers to temporarily freeze assets of individuals or entities in their jurisdiction, without proving criminality. In some cases, they can ask other governments to cooperate.

Owners are typically barred from selling or benefiting from them until sanctions are lifted or successfully contested. Governments typically can’t move to take ownership of the assets, though, except after often-lengthy legal proceedings that would require proof of lawbreaking. The U.K. government, however, is considering laws that would give itself the powers to seize sanctioned assets.

Mr. Abramovich’s two megayachts—objects of fascination among yacht aficionados—have gained a wider following amid the sanctions efforts. Easy-to-access online ship-tracking sites have been reporting their nearly real time movements and those of other sanctioned Russian oligarchs.

A handful of yachts belonging to EU-sanctioned Russian billionaires have been seized in recent days by French and Italian authorities. Mr. Abramovich hasn’t been sanctioned by the EU.

Mr. Abramovich’s 533-foot superyacht Eclipse passed through the Strait of Gibraltar into the Mediterranean on Saturday afternoon, after leaving Philipsburg, in the Dutch Antilles in the Caribbean, on March 3, according to vessel tracking site FleetMon. The 460-feet My Solaris, meanwhile, arrived Friday in Tivat, Montenegro, having left Barcelona, Spain, three days earlier, according to FleetMon.

In the Portugal case, authorities initiated a criminal investigation earlier this year into allegations that Rabbi Litvak had falsely attested to the Sephardic origins of Mr. Abramovich and others, according to a statement by the Porto Jewish Community issued March 6.

Rabbi Litvak was questioned by Portuguese authorities late Friday and released, but is forbidden from leaving the country or having contact with other suspects in the case, according to state-owned broadcaster RTP.

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