U.S. billionaire Wilbur Ross, who together with a group of investors participated in Bank of Cyprus’s August 2014 capital increase, is facing questions following his nomination as US Secretary of Commerce related to his ties with major Russian bailed-in shareholders, the Miami Herald reported on Thursday.
Days after US president Donald Trump suffered a major blow when his national security adviser Michael Flynn resigned over misleading Vice President Mike Pence about the content of his conversation with the Russian ambassador to Washington, six Democratic senators have raised questions about Ross’s ties to Viktor Vekselberg, a friend of Russia’s president Vladimir Putin, and Vladimir Strzhalkovsky, Bank of Cyprus’s former vice chairman and an ex-KGB agent, the Miami Herald reported.
Ties of members of Trump’s team with Russia and Putin are currently attracting the attention of media after US intelligence said that the Kremlin meddled in the US presidential elections in favour of Trump in November by email hackings and spreading of fake news. The US – Russian relations reached their lowest point after Putin ordered three years ago the invasion and annexation of Ukraine’s Crimean peninsula, to which the West responded with sanctions.
The six senators, Bill Nelson of Florida, described as “the top Democrat” in the commerce committee of the US senate, Richard Blumenthal of Connecticut, Ed Markey of Massachusetts, Tom Udall of New Mexico, Cory Booker of New Jersey, and Tammy Baldwin of Wisconsin, have asked Ross, whose confirmation is still pending, in a letter to answer questions about possible loans extended by Bank of Cyprus to the Trump Organisation directly or indirectly, the Miami Herald reported.
The Trump organisation operates hotels, golf courses and a real estate division.
As Ross, who made a fortune by investing in, restructuring, and selling his stake in Bank of Ireland four years ago, “was instrumental” in shaping Bank of Cyprus’s board of directors, which also included Josef Ackermann, the former Deutsche Bank top executive, he may also have to answer questions about Bank of Cyprus chairman’s ties to president Trump and the Trump Organisation.
“The Trump Organization has debt with Deutsche Bank, which loaned it more than $364m in recent years and more than $3bn since the 1990s,” the Miami Herald reported. “Deutsche Bank, under Ackermann, repeatedly ran afoul of U.S. and European regulators. Most recently, the bank agreed on Jan. 31 to pay $630m in fines to end investigations in New York and London into complex trades in Russia that regulators thought might reflect money laundering.”
In January, Bloomberg reported that Ross would sell his stake in the Atlanta-based WL Ross & Co. LLC, which invested in the Cypriot bank, and resign as Bank of Cyprus vice-chairman. Sources with knowledge of the situation said that Ross already stepped down from his post as board member, a step that the bank has not officially announced yet.
Bank of Cyprus did not respond to a request for comment.
In January, Ross informed senator Maria Cantwell, a Democrat, that he had no relationship to Vekselberg, who controls a 9.3 per cent stake in the bank via Lamesa Holding S.A., affiliated with the Renova Group, and had only met him after investing in the bank once, for an hour, the Miami Tribune reported, prompting Cantwell to ask details about what the two men discussed.
In 2015, Strzhalskovsky significantly reduced his stake in Bank of Cyprus and resigned from the board of directors.
The Miami Herald full report is available here.