Middle class drug use is funding Russia‘s war in Ukraine and even espionage activity on British soil via a global money laundering network, law enforcement chiefs warned.
A billion-dollar network so large it has bought a bank in Kyrgyzstan is operating in 28 UK towns and cities collecting ‘dirty’ cash from criminals then converting it to ‘clean’ cryptocurrency.
In the past 12 months the National Crime Agency has arrested 45 suspected money launderers and seized more than £5million in cash.
And last year it dismantled a network run by glamorous Siberian millionaire Ekaterina Zhdanova which laundered money for Irish cartel the Kinahans and state-sponsored spies.
But deputy director Sal Melki said that the horrifying link between casual drug use and nefarious activity from the Russian state had become clear for the first time.
‘We can draw a really clear thread between someone buying cocaine on a Friday night all the way through to geopolitical events causing suffering across the world,’ he said.
Mr Melki explained that money earned by drug dealers and other criminals moved upstream to be laundered by the network, with the money launderers taking a slice of these profits.
This money was then used to fund Russian intelligence projects, military operations and to help state-backed organisations circumvent sanctions.
Ekaterina Zhdanova, who was born in Siberia and built a vast network of contacts in Moscow, ran the ‘Smart’ money laundering network but is now in custody in France
The NCA has seized more than £5million in cash in the last 12 months alone from people involved in the money laundering networks
‘It’s not as simple as paying a drug dealer and the crime goes away – it is funding bad things around the world,’ he added.
Russian intelligence used Zhdanova’s network, named Smart, to provide funds to a UK-based group of Bulgarians who were convicted in March of a spying operation which passed secrets to the Kremlin for three years.
The group, led by a man named Orlin Roussev, received orders directly from Moscow and was run from a Great Yarmouth guesthouse stacked with sophisticated surveillance technology.
Smart and another group named TGR, headed up by Russian businessman Georgy Rossi, were dismantled by Operation Destabilise last year and Zhdanova is currently held in pre-trial detention in France.
In August, a company linked to Rossi named Altair Holding SA was sanctioned in Britain after it was identified as owning a controlling 75 per cent stake in Kyrgyzstan-based Keremet Bank which was utilised for sanctions evasion.
Solution architect at anti-money laundering firm Strise, Robin Lycka, explained that the purchase of the bank represented a new sanctions evasion model where ‘you become a bank instead of using a bank.’
The network had brought its financial infrastructure in-house to give money launderers full control over the creation of data and any reports that might trigger safeguarding measures, he added.
Russian businessman Georgy Rossi (right, with Elena Chirkinyan) heads up money laundering group TGR and bought a controlling stake in Kyrgyzstan-based Keremet Bank
The NCA and Scotland Yard have made a series of arrests of couriers who collect cash from criminals and transport it on behalf of money launderers.
Among them was Giorgi Tabatadze, who was sentenced to three years in prison for helping the networks to launder £2.2 million.
Tabatadze was arrested by NCA officers in April 2024 and more than £750,000 in cash was seized from his car and home address.
The NCA has begun installing posters with warnings for other couriers in English and Russian above urinals and hand dryers at services stations across Britain.
‘Millions of Britons will have seen these messages at service stations but rest assured, they were not for you,’ Mr Melki said.
‘To the launderers who will have seen them, your choice is simple: either stop this line of work, or prepare to come face to face with one of our officers and the reality of your choices. Easy money leads to hard time.’
The money laundering network operates in 28 towns and cities in the UK
Vitaliy Lutsak (pictured) and Valeriy Popovych were sentenced in April to a combined 13 years for laundering £6million
Valeriy Popovych and Vitaliy Lutsak were sentenced in April to a combined 13 years for laundering £6million – exploiting the Russia-Ukraine war to launder their criminal profits.
The pair used criminal cash to purchase vans and lorries in Britain before selling them into Ukraine, converting the profits into cryptocurrency.
The scheme enabled Popovych to buy a £1million second home in London.
Security Minister Dan Jarvis said: ‘This complex operation has exposed the corrupt tactics Russia used to avoid sanctions and fund its illegal war in Ukraine.
‘We are working tirelessly to detect, disrupt, and prosecute anyone engaging in activity for a hostile foreign state. It will never be tolerated on our streets.
‘I want to thank every officer for their work uncovering this criminality and intercepting the dirty money networks that bankroll serious organised crime.