To "clean up the image of the country", the government of Cyprus has managed to achieve a significant reduction in the presence of Russians and Ukrainians in the financial sector of the island state.
According to the latest data, from 2014 to 2022, the volume of deposits of Russian citizens in the banks of Cyprus decreased by 76%, and Ukrainian citizens - by 67%.
The number of clients from the Russian Federation - by 82%, as well as Ukraine - by 54% - has also significantly decreased. In total, Cypriot credit organizations for the period under review terminated business ties with 60 thousand customers, among whom were mainly citizens of Russia and Ukraine. Banks also froze 126 thousand accounts totaling about 40 billion euros.
According to the Cypriot government spokesman Konstantinos Letimbiotis, the outflow of money of Russians and Ukrainians from Cyprus compensated for the "relocation" to the country of a large number of international companies - more than 1.6 thousand. They helped to create almost 37 thousand jobs, which is 42% more compared to 2021.
For many years Cyprus has been known as a jurisdiction where no unnecessary questions are asked and banks accept money from wealthy depositors, regardless of their reputation and connections. The island nation was particularly popular with wealthy Russian oligarchs.
However, this began to change after sanctions were imposed on Russia in response to its actions in Ukraine. Cypriot President Nikos Christodoulides, who took office in March 2023, promised to enforce the anti-Russian sanctions and said the country was committed to "being on the right side of history." The consequence has been massive inspections of Russian companies registered in Cyprus, forcing some of them to move their headquarters outside the country.
Speaking before the Parliamentary Assembly of the Council of Europe on Tuesday, January 23, Nikos Christodoulides said that Cyprus had fully complied with all European Union sanctions against Russia.
I stand boldly before you and admit that mistakes were made. All of this is now history for Cyprus. Mistakes were made in the past and the first to pay for those mistakes were the Republic of Cyprus and its people," Christodoulidis said, referring to the money laundering allegations that have long haunted the island state, as well as the now-defunct scandalous Citizenship by Investment program.
Christodoulides emphasized that Cyprus' success in laundering Russian money is due, among other things, to the invitation to the country of a team of experts from the U.S. Federal Bureau of Investigation and the Justice Department. They help Cypriot investigators in cases involving so-called "enablers" - lawyers and accountants who help hide the assets of sanctioned Russians and their companies.