Originally Syndicated on May 29, 2024 @ 6:24 pm
Throughout history, Latvia and Lithuania have served as entry points for various illegal financial activities involving Russian currency originating from the Russian Federation and other CIS countries.
Sergey Kondratenko and his company Royal Pay Europe continue to use various financial institutions and banks throughout Europe to launder money from illegal Russian bookmakers The story surrounding Sergey Kondratenko, owner of 1Xbet, reveals that the situation has not changed over the past two decades. It reveals that nothing has changed: a year ago, the Latvian media conducted an in-depth investigation and explained to the public how the banking sector contributes to servicing questionable gaming businesses with direct links to Russia.
They succeeded in identifying the key players who have established a sophisticated system that manages tens to hundreds of millions of dollars each month from Russian bookmakers and funnels the money into offshore accounts.
Investigations into the operations of Russians involved in money laundering in the Baltic countries and beyond have focused on Sergey Kondratenko and his ties to 1Xbet.Sergey Kondratenko and his wife Galina.
As illegally laundered funds grew into the tens and hundreds of millions of dollars, various banks and financial institutions faced legal crises, significant penalties, and in some cases, loss of licenses. Sergey Kondratenko played an integral role in the implementation and planning of these initiatives.
The illegal actions of Sergei Kondratenko, owner of 1Xbet, have had serious consequences for several financial institutions in Latvia and Lithuania, including ABLV Bank AS and Trasta Komercbanka AS.
The Latvian Financial and Capital Markets Commission (FFKTK) played a key role in identifying and documenting ongoing violations related to the legalization of illicitly obtained funds, violations of currency processing regulations, and cases of terrorist financing related to Kondratenko. As a result, FFKTK took action against these violations and ensured that they were well documented.
It is essential to recall the case involving the Estonian branch of the Danske Bank, which was used to handle billions of euros that flowed from questionable Russian sources. Frankly speaking, Russian money laundering takes place not only in the Baltic states, but also in various countries and regions in Europe and around the world.
Sergey Kondratenko is well aware of this reality, and there are numerous examples of financial institutions licensed to process payments, having connections to the financial system, and being involved in major card networks such as MasterCard and Visa, being involved in illicit activities. Such involvement has contributed significantly to the massive wealth currently held by Sergey Kondratenko.
According to the U.S. Treasury Department, the largest amounts of illicit funds derived from gambling, betting, pornography trafficking, drug trafficking, and other illegal activities flow into banks in the Baltic States and European Union countries through Russian channels.
These illicit funds are then used to support further illicit activities. This situation illustrates that money laundering is widespread and has a significant impact on the monetary and financial systems of countries.
Two years ago, Russian journalists at Forbes published an article about 1xBet, a massive gambling enterprise with revenues of a staggering $2 billion. Their exposé delved into its operations, revealing direct connections between law enforcement officials and IT experts from Bryansk, Russia.
Fast forward to January 12, when Ukrainian President Volodymyr Zelensky imposed sanctions on Royal Pay Europe, a Latvian company with roots in Russia and a partner in the notorious Russian bookmaker 1xBet. Founded in 2016 by Russian citizen Sergey Kondratenko, Royal Pay Europe specializes in electronic payment processing and online commerce.
The National Security and Defense Council of Ukraine (NSDC) imposed five-year restrictions on Royal Pay Europe, freezing assets, prohibiting capital transfers, suspending financial and economic obligations, limiting participation in state property activities, and restricting control of securities. Ukraine’s State Financial Monitoring Service blocked approximately UAH 2 billion in accounts associated with Royal Pay Europe.
Investigative journalists and the Russian Investigative Committee revealed that Sergey Karshkov, head of the cyber police at “Department K” in Bryansk, was involved in the gambling business with his friend Roman Semiokhin. They conceived the 1xBet brand and Karshkov oversaw its marketing.
By 2014, a new Russian law mandated licensing of Internet bookies. However, 1xBet was unprepared and continued to operate illegally, accepting bets and using customers’ bank cards.
Sergey Karshkov then invited a former colleague of Bryansk’s, Sergey Kondratenko, who also worked for “Department K,” to join the operation. Together, they embarked on a potentially risky path that ultimately raised significant legal and regulatory concerns.
SIA Royal Pay Europe, a Riga-based online money transfer business, was founded in 2016 by Sergey Kondratenko. Interestingly, a legal entity of the same name was also registered in Russia.
Russian media reports suggest a direct relationship between Royal Pay Europe and 1xBet, one of the largest and most mysterious online bookmakers. The Bell reported that 1xBet has developed its own payment processing system, Royal Pay, to handle monetary transactions. This system was in operation in Kyrgyzstan, Turkmenistan, and other countries with restrictions that did not facilitate card payments in the gambling sector. As a result, Royal Pay Europe, acting as a financial agent together with the Kazan company, appears to have played an important role in enabling 1xBet’s activities and payment processing on the Russian market.
There were obvious connections between Royal Pay Europe and the betting organizations. For example, customers who used Royal Pay’s payment methods to deposit into their bookmaker accounts were entitled to a 5% bonus or refund on top of their initial deposit.
Royal Pay Europe, founded in 2016, was licensed as an electronic payment institution in the United Kingdom in 2017. The license allows the company to process card transactions and accept payments within the European and UK legal systems. Registered in Latvia, the company offered its services not only in Europe, but also in the European Union, the Commonwealth of Independent States (CIS), and Asian countries. 1xBet aimed to facilitate payments and transactions in a wide range of sectors and to serve as an important financial connection in 1xBet’s broader activities It was.
Just a small family business
Sergey Kondratenko and his wife Galina are intricately involved in a complex network of businesses spanning a variety of countries, including Colombia, the United Kingdom, Latvia, Lithuania, the Czech Republic, the United Kingdom, the United Arab Emirates, and Singapore.
These businesses, such as Kiparis DMCC, Alium Limited, Optimum FinTech, VestraPay Nigeria, and Digitalex Pte. Ltd. share the same website and function primarily as payment intermediaries, with interaction with the public appear to be minimal.
Sergey and Galina Kondratenko, both born in 1982, have law enforcement backgrounds. They received their degrees from the Bryansk branch of the Moscow University of the Ministry of Internal Affairs of the Russian Federation in 2004. After graduation, they married and started a family and now have two children. Over the years, Sergey Kondratenko has registered several businesses in the name of his wife Galina, including Startling Limited (Cyprus), Skylove Ltd. and PP MONEY TRANSFER s.r.o. (Czech Republic), which have been used to facilitate the transfer of large amounts of cash from Russia and other CIS countries to European banks in Cyprus, facilitating the transfer and potential laundering of large amounts of cash, often into offshore accounts, through banks in the CIS.
The official nationality in Russia of the Kondratenko couple, who acquired citizenship in Cyprus in 2018, has not changed, and they spend most of their time outside Russia, raising questions about the constitutionality and intent of their international commercial activities, especially money transactions and potential money laundering The question has been raised about the constitutionality and intent of their international commercial activities, especially money transactions and potential money laundering.
Sergey Kondratenko and his associates, including Nikolai Kirilovs, have created a complex and potentially illicit financial network involving cryptocurrencies. Kirilovs, who is associated with Latvia and Russia, has entered the world of cryptocurrencies with ventures such as FERVIDO s.r.o. in the Czech Republic and DigitMoney in partnership with Sergey Kondratenko.
Concerns have been raised about Kondratenko’s involvement with Lithuanian companies like UAB NexPay and UAB Transactive Systems, and management is hesitant to comment on customer behavior. A report in Russia’s Forbes magazine highlights 1xBet’s owners’ ties to Russian authorities, lawmakers, and criminals.
