Russian state high-tech investment fund caught taking taxpayer money offshore
Rosinfokominvest, the Russian State Investment Fund for Information and Communication Technologies, established in 2007 to modernize the Russian economy, has financed only one project in the more than 10 years of its existence – a scheme to take taxpayer money out the country.
This was the conclusion reached by Russia’s Accounts Chamber after an audit of how the budget funds allocated to the company have been used.
According to the fund’s business plan from 2007, after receiving 1.45 billion from the government, it was supposed to invest approximately 1.2 billion in 14 projects, and then sell shares to investors and give the money back to the budget. The fund was also expected to pay annual taxes, contributing 813 million rubles to the treasury over 10 years.
In reality, the fund has implemented only one 148 million ruble project – RoboETF, a platform for launching exchange traded funds and robo-advising (automated advice for investors).
“In actual fact, 98% of the authorized capital of the established JSC Roboinvest was transferred to the account of a company registered in the Cayman Islands, which has neither employees nor managers,” the Accounts Chamber reports.
“The expenses to implement the project exceeded the revenue received, and the result of its implementation was the creation of yet another formally Russian company with 150 million rubles of registered capital and a founder registered in an offshore jurisdiction,” observes Accounts Chamber auditor Vera Chistova.
In 2018, the company pulled out of the project ahead of schedule, but “of returning the monetary funds to the Russian Federation, only 50% has been documented”.
The amount of tax paid by the fund to the federal budget was less than 6% of the planned amount – 44.8 million rubles for 10 years.
“In the period between 2011 and 2014, the company’s financial and economic activity was unprofitable. Between 2007 and the present, Rosinfokominvest’s assets have devalued by nearly 60% in dollar terms,” the Accounts Chamber observes in its conclusion.