27.05.2024 Money laundering

WhiteBIT under the patronage of the Russian Shentsevs

Cash and bank transfers are fading into the background. They have been replaced by much better and more hidden ways to withdraw millions abroad, avoiding taxes and fees.

Cryptocurrency exchanges are a popular way to withdraw funds today, as they have a number of advantages: anonymity, inability to track movement, and insufficient regulation in terms of legislation. There are now hundreds of such crypto exchanges, as well as millions of legalization mechanisms.

One of the Ukrainian representatives of exchanges is WhiteBIT. “It is the best crypto exchange with reliable encryption, high security, and insurance.”

It is actively promoted to attract as many users as possible. WhiteBIT has had joint projects with the Ministry of Foreign Affairs, and the Ministry of Digital Transformation has implemented a free crypto literacy course for the public with the help of this exchange. In addition, the crypto exchange has cooperated with FC Barcelona, Lifecell, the Ukrainian Football Association, and others.

According to the founder and CEO Nosov, the exchange’s daily turnover is $500 million. But how much of these millions are of Russian origin?

WhiteBIT and offshores

In 2018, WhiteBIT operated without a legal entity. The company’s activities were then carried out through the individual entrepreneur Nosov V.V. and other controlled fictitious individual entrepreneurs. In fact, the crypto exchange was used as an illegal cryptocurrency exchange.

Subsequently, in order to increase current assets and give the appearance of legality to WhiteBIT’s activities, a number of companies were founded in Ukraine, including SMART 2019 LLC, ETHOMIK GANS RECORDS LLC, WHITE DIGITAL LLC, DIGITAL STRATEGIES LLC.

On January 07, 2019, WHITEBIT FINANCIAL COMPANY OÜ was registered in Estonia with a capital of EUR 12 thousand. The company had neither offices nor employees, except for the legally required member of the management board, an Estonian citizen Viktoria Šerle.

This is explained by the desire of the exchange founders to withdraw from Ukrainian jurisdiction, evade taxes and complicate the tracking of the crypto exchange’s activities.

In 2020, in order to expand the transnational criminal channel for money laundering in the offshore zone, WHITEBIT SOLUTIONS LLP was established in the Seychelles with the registration address: Room 5, Second Floor, Olivier Maradan Building, Victoria, Mahe, Seychelles.

And on 31.01.2020, WHITEBIT SOLUTIONS LLP was established in the UK, with the head of the company listed as the director: CODDAN NOMINEE ADMINISTRATOR LTD and WHITEBITSOLUTIONS LTD with registration in the offshore Seychelles: Room 5, Second Floor, Olivier Maradan Building Victoria, Seychelles, Mahe.

In fact, none of these companies or any other companies that are part of the WhiteBIT group of companies have licenses/permits to carry out legal and legitimate cryptocurrency trading activities.

WhiteBIT and Russian roots

Although Vladimir Nosov introduces himself as the founder and CEO of WhiteBIT, the crypto exchange officially has completely different owners. We are talking about the Shentsev family – Nikita and Dmitry. Both of them used to represent the interests of the pro-Russian OPFL, the former as a member of the Kharkiv Regional Council and the latter as a member of parliament.

Until recently, Shentsev owned 51% of the Estonian subsidiary of the crypto exchange, and Maria Repeshko, who, according to the register, is Shentsev’s partner in a law firm, had 5%. But on March 2, 2023, both of these shares were re-registered to Nosov.

Subsequently, the list of the crypto exchange’s ultimate owners changed, with Nosov’s partner Glib Ushakov and Whitebit’s vice president Alexei Kovalev among the new beneficiaries.

We suspect that such manipulations are related to masking Russian traces in the currently popular Ukrainian crypto exchange. However, the network remembers everything. And even the fact that Nikita Shentsev was included in the list of people to be deprived of Ukrainian citizenship for reasons of belonging to the Russian Federation.

We told more about the history of the Shentsev family in our investigation. More in the following articles.

The fact that the Whitebit exchange not only has pro-Russian owners, but still cooperates with the aggressor state is evidenced by an eloquent fact. According to media reports, in mid-March 2023, a large amount of money was recorded – 3,299 BTC (about $85.6 million) in bitcoins owned by the Russian crypto exchange BTC-e.

Non-stop work

We have investigated bank accounts in Ukrainian institutions owned by legal entities controlled by Whitebit (WITHDIGITAL LLC, DIGITAL STRATEGY LLC, ETHOMIC GANCE RECORDS LLC, SMART 2019 LLC) used for legalization and withdrawal of funds. We are talking about:

  1. JSC “Idea Bank” MFO 336310 account number UA043363102600600100100924361 opened on 09.11.2021 (Ukrainian hryvnia)
  2. JSC “Idea Bank” MFO 336310 account number UA043363102600600100100924361 opened on 09.11.2021 (Dollar)
  3. JSC “Idea Bank” MFO 336310 account number UA043363102600600100100924361 opened on 09.11.2021 (Euro)
  4. JSC “Idea Bank” MFO 336310 account number UA603363102600600100100924420 opened on 02.11.2021 (Ukrainian hryvnia)
  5. JSC “Idea Bank” MFO 336310 account number UA603363102600600100100924420 opened on 02.11.2021 (Dollar)
  6. JSC “Idea Bank” MFO 336310 account number UA603363102600600100100924420 opened on 02.11.2021 (Euro)
  7. JSC “SENS BANK” MFO 300346 account number UA273003460000026001026577301 opened on 05.12.2018 (Ukrainian hryvnia)
  8. JSC “SENS BANK” MFO 300346 account number UA413003460000026007096023801 opened on 08/19/2020 (Ukrainian hryvnia)
  9. JSC CB “PRIVATBANK”, Kharkiv MFO 351533 account number UA863515330000026003052116667 opened on 07.10.2019 (Ukrainian hryvnia)

We have sent complaints to Ukrainian banks and regulatory authorities demanding financial monitoring. However, apart from a formal “thank you for your appeal” and a notification of processing, no action was taken. Does it mean that everyone in this chain is interested in laundering Russian money?

We continue monitoring and will appeal to the NBU to take action. We are continuing our investigation.

I have the information – where to go?

Please report any schemes involving crypto exchanges to the chatbot or email info.nonstopukraine@gmail.com

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