Entry type: Single project
Publishing organisation: Transparency International – Russia, Transparency International – UK, Transparency International – Czech Republic, Meduza, The Insider, Novaya Gazeta Europe, Eesti Päevaleht
Organisation size: Small
Publication date: 2022-07-07
Language: Russian, English, Estonian
Authors: Elizaveta Tsybulina, Ilya Shumanov, Artem Schennikov, Steve Goodrich, Ben Cowdock, Marek Chromý
Elizaveta Tsybulina – TI-R’s Head of the “Dirty money” department, project manager, and senior analyst.
Ilya Shumanov – CEO of Transparency International – Russia.
Artem Schennikov – editor of infographics at Novaya Gazeta and Novaya Gazeta Europe.
Steve Goodrich – TI-UK’s Head of Research and Investigations. He is responsible for managing TI-UK’s research unit and is TI-UK specialist on lobbying accountability, party funding and open governance.
Ben Cowdock – leads TI-UK’s research and investigations into Britain’s role as a hub for the proceeds of international corruption.
Marek Chromý – lead analyst at TI-CZ.
$820 000 000 were laundered through international
trade transactions from 2014 to 2016 – eightfold as was discovered by Sergey Magnitsky.
130 companies across 18 countries, 28 Russian and 11 foreign banks, Russian companies with already tarnished reputations, Russian custom authorities, PEPs and officials were involved in the laundering mechanism.
What distinguishes these trade deals is the subject – injection molding machines, which were not only non-existent but also sold at prices hundred times exceeding market`s
Allegedly laundered money had been stolen from Russian banks, which subsequently had their licences revoked, by participants of the scheme.
Upon publishing this investigation we received a plethora of requests from other journalists. Not only they were genuinely interested in tools and methods we had used, but this investigation raised awareness about TBML in them.
In addition, our Czech colleagues from Transparency International – Czech Rebublic were so impressed by done job that they launched and published their own [investigation](https://www.transparency.cz/publikace-a-analyzy/analytical-report-the-first-czech-russian-laundromat-exposed/) in the wake of the aforementioned one.
Moreover, our work was critically acclaimed by Oliver Bullough and Louise Shelley.
First of all, this investigation required meticulous work with sources. What started as a sole document from a whistleblower morphed into several months of gathering information from various databases, OSINT, thorough qualitative analysis of all found correlations and never-ceasing fact checking. It was necessary to find and verify information about contragents and their beneficiaries which in turn led to a red flag methodology that made identifying suspicious transactions possible. Because this project required the utmost responsibility, much of the analysis work had to be done manually.
Only at early stages, for preliminary analysis, we used software algorithms based on statistical methods for searching for suspicious transactions. However, not all suspicious transactions were verified as money laundering, thus were excluded from the final iteration of the investigation.
One of the biggest challenges was striking the balance between building a model that is simple enough to explain the money laundering scheme to the casual reader and building a model complete enough not to hide all those involved in criminal acts.
Context about the project:
Unlike most investigations this one is not based on the leakage of data. The wistleblower provided us with just one dubious customs declaration and the rest was retrieved via public sources, variuos data bases, in particular Import Genius.
We would like you to pay special attention to the [link](https://novayagazeta.eu/articles/2022/07/08/plastic-laundromat) attached herewith – it contains a really comprehensive infographic
What can other journalists learn from this project?
[Trade-based money laundering](https://transparency.org.ru/en/special/tbml) (TBML) is becoming more popular among perpetrators. However journalists pay little attention to this laundering scheme, although it may be investigated with open sourse data. We hope, our project sufficiently explains the essense of TBML and will become useful for further investigations.