US seeks confiscation of Russian superyacht

Russian superyacht Amadea (IMO 1012531) was just one of many such vessels that found itself caught up in a maze of sanctions, seizures and suits after Russia’s invasion of Ukraine in February 2022.

Now, more than a year after seizing the vessel in Fiji, the US Department of Justice has filed suit to confiscate the vessel and sell it. The court case claims that Russian billionaire Suleiman Kerimov bought the yacht in 2021 for $225m. Kerimov had already been sanctioned by the US (in 2018) in connection with Russian military activity in Syria and Ukraine.

The Amadea stopped transmitting its position on February 24th last year, and by April 12th was in the port of Lautoka, Fiji. It was later noted that the Amadea had clocked up 8,358nm between February 24th and April 12th 2022. It had previously been moored off the Caribbean island of St Maarten since around Christmas 2021 and was still there when Russia began its armed conflict in Ukraine.

On March 12th it began moving west and eventually passed through the Panama Canal. From there it headed northwest to Mexico, where it arrived at the port in Manzanillo on the country’s west coast on March 24th  for a short stay, probably needed for refuelling. It then headed for Fiji and arrived in the port of Lautoka on April 12th.

At the time its was Cayman Islands-flagged and owned by Millemarin Investments Ltd care of manager Imperial Yachts Sarl of Monte Carlo, Monaco.

The courts now became involved at the behest of the US and on April 20th 2022 a judge allowed a Fijian Director of Public Prosecutions bid to “be restrained from leaving Fijian waters until the finalization of an application to register a warrant to seize the property”.

Early in May a Fijian court ruled that the US could seize the yacht.

However, on May 12th 2022 a Fijian court paused the seizure. The Fijian High Court granted a request from Millemarin Investments to stay the asset seizure, pending an appeal.

That appeal was dismissed on May 30th 2022.

But the US victory was to be paused again. In early June the Fijian Supreme Court ruled that the Amadea could not leave Fijian waters.

However, the Supreme Court eventually gave permission for the yacht to leave, and on June 16th it arrived it Hawaiian waters. It was at this point that the registered owner became National Maritime Services Inc and the P&I insurer was American Club. Its manager was Fraser Yachts Florida Inc of Fort Lauderdale, Florida, USA.

Reportedly, Fiji’s Supreme Court ruled that the yacht should leave the country not on any complex legal grounds, but because to keep it in Fiji would be too expensive.

Its stay in Hawaii was brief. It left on June 19th 2022, and arrived in San Diego, California, on June 27th, having crossed the Pacific twice in six months. And there it currently remains.

In its current legal action, much of the ground seems similar to that covered in Fiji last April, May and June.

The DoJ alleges that Kerimov used a Russian-doll arrangement of shell companies, thus concealing that he was the beneficial owner. Whoever did buy the yacht, it was not a good business move. The value of Russia-connected superyachts dropped precipitously in 2022 after the invasion.

According to the federal prosecutors, Kerimov avoided the need to have his name on the paperwork; neither was he required to notify the flag state that the vessel had been sold. Nevertheless, crew email communications sent immediately after the sale suggested that the vessel had a new, unnamed, owner, and that the owner’s representative was Dinar Khalikov, who happened to be an assistant employed by Kerimov. An email sent by the vessel’s master suggested that Khalikov conveyed requests to redo the ship’s interior decorating. The DoJ said that this was not typical behaviour for a temporary guest.

The first guest on the manifest for the new owner’s first voyage was Suleiman Kerimov, and he was assigned the owner’s cabin.

The suit further asserts that Kerimov continued to pay for upkeep of the yacht, and that he used the US financial system to transfer funds. That itself would be a violation of the law. 

A different person, yacht broker Evgeny Kochman – the president of Imperial Yachts – was the listed owner of the holding company that legally owns the yacht. Kochman and Imperial have also been sanctioned by the US government because of their links to Russia.

Added to the mix is a third Russian national, one Eduard Khudainatov, former CEO of Rosneft, who has also filed suit claiming to be the true beneficial owner of Amadea. The DoJ has cuttingly replied that Khudainatov might be rich, but he isn’t *that* rich, and he could not possibly have the funds to afford the upkeep for Amadea. Indeed, Khudainatov claims to be the beneficial owner of several Russia-linked superyachts. For example, he was also linked to the $700m superyacht Scheherazade, which was seized in Italy and was also subject to of an investigation into its real owner. Conveniently, he is not on the US Treasury’s blacklist. The FBI believes that he is a front, a strategy it has seen before during the days when the Mafia was involved in the ownership of many Las Vegas casinos on the Strip, but chose local businessmen as “fronts” to bypass Nevada’s licensing restrictions. The FBI has called Khudainatov as nothing but a “clean, unsanctioned straw owner” for wealthier Russians who want to protect their yachts from US seizure.

Task Force KleptoCapture co-director Michael Khoo said that “the United States brings this action . . . after a careful and painstaking effort to develop the necessary evidence showing Suleiman Kerimov’s clear interest in the Amadea and the repeated misuse of the US financial system”.

The federal government has also blocked $1bn in assets held by Heritage Trust, an American investment company in which Kerimov holds an interest.

20106-built, USA-flagged, 4,402 gt Amadea is owned