Following the information about the Prime Minister’s expected recovery, the scandalously famous bookmaker Fonbet refused to accept state support thereby making a gift to Mikhail Mishustin. “We don’t need financial assistance from the state now,” the company proudly stated, as if not noticing that it had already been removed from the list of those who need it.
The Russians, in turn, have not yet noticed the results of a loudly announced investigation, almost supervised by the Prime Minister, of how Fonbet got on these lists in the first place, especially considering all the shadowy sides of the company’s business that were unveiled is a series of journalistic investigations.
The fact that a bookmaker was included in the government’s list of economic ‘backbone’ organizations, which, if necessary, may obtain state support during the crisis, caused surprise and indignation not only in society but also among officials of the Ministry of Finance, whose list included Fonbet, and other bookmakers. The players of the betting market perceived Fonbet’s inclusion in the list with hostility. “It's hard to imagine what resources a bookmaker must have in order to get there,” they mused.
The question of ‘resources’ is still one of the key issues. It turned out that Mishustin did not make the list himself personally. First Deputy Prime Minister Andrey Belousov – whose wife is suspected of having common business interests with Maxim Lalakin, the son of Sergey Lalakin, whom the Kommersant newspaper named the leader of the Podolsk Crime Group back in 1995 – had a hand in this. Both Lalakins at one time had a relation to Fonbet’s business.
However, is Andrey Removich Belousov, whom the Novye Izvestiya newspaper calls ‘one of the leading defenders of bookmakers’ the only one who can be related to the strange ascent of Fonbet? The newspaper believes that it was Belousov who included Fonbet Betting Company in the list of economic ‘backbone’ enterprises that may expect state support. Still, what about Mishustin? Did he sign the list blindly, or did he not know what industry the company represented? This is hard to believe!
One of the common explanations of how a bookmaker got on the list of economic ‘backbone’ companies says that “most likely, it was a misunderstanding when the persons, who generated the list, took into account the size of revenue and tax payments, without checking the details of the company's type of economic activity.” However, the media mentioned that the enterprises were selected by the Federal Tax Service, which, by the way, not only registers bookmakers, but once, for some reason, “failed to notice” the illegal activities of the bookmaker, which rose up during the years when Mikhail Mishustin had been managing the Federal Tax Service. Assuming that the former head of the Federal Tax Service, and now the prime minister does not know one of the largest taxpayers in the country and does not know what his former subordinates are doing would have meant that we doubt his professionalism.
Hence, the question of whether the Prosecutor General’s Office is powerful enough to find a real lobbyist for bookmakers in the government – not just a scapegoat – when the top officials are involved in the story becomes quite acute. Moreover, the investigations of Novaya Gazeta, The Bell, and Novye Izvestia show that we are talking about lobbying for channels allowing the semi-criminal structures to withdraw billions of rubles from the country.
Novye Izvestia reports that the ‘backbone’ bookmakers turned out to be Mafiosi from the 90s who refused Russian citizenship.
The newspaper’s investigation began from 1994, when OOO F.O.N., known as Fonbet, was founded by Anatoly Machulsky. When the legal casinos were banned in Russia in late 2000s, the company began to generate billions, and when Machulsky died in London on February 17, 2017 at the age of 60 it was inherited by his daughter. However, the company showed its first official profit only in 2015. In 2019, its revenue reached 24 billion rubles, and net profit – 9 billion rubles.
Almost all journalistic investigations agree that Fonbet from the very beginning was closely connected with the ‘Russian mafia’ and Sergey Lalakin, aka ‘Luchok’, who headed the ‘Podolsk Criminal Group’ in the 90s.
“Since the end of the 80s, Luchok, along with his friends, started ‘business’ – he made money from thimble-rigging and phony cash”, Kommersant reported in 1995. Fontanka wrote that in the 1990s Sergey Lalakin participated in the work of the Marafon bookmaker created by Anatoly Machulsky, his “partner in chess playing” and the founder of Fonbet. Some journalists wrote about the business relations of Lalakin Jr. and a woman whose last name, first name and patronymic coincide with those of Andrey Removich Belousov’s wife.
In its investigation, Novaya Gazeta pointed out to the possible connection between the Lalakins family and the family of the main curator of the gaming business in the government – Deputy Finance Minister Tatyana Nesterenko. “The Moscow apartment, in which Nesterenko’s daughter Marina and her husband, the owner of the Bingo Boom bookmaker Mikhail Danilov, used to live, was previously owned by the full namesake of Maxim Sergeyevich Lalakin. In addition, Lalakin owned a house in a cottage village in the Istra District of the Moscow Region – next to the house of Tatyana Nesterenko,” the newspaper wrote.
Yet, these are all indirect connections, Novye Izvestia believes, whereas there are much more evident ones. One of the Fonbet shareholders is Stanislav Magomedov, who owns 8% of the company. He is also Maxim Lalakin’s partner in his business. Magomedov owns 40% of the Usadba 150 Company, which manages the property of the bath complex in the village of Borki on Rublevka. Lalakin Jr is a co-owner of the bath complex.
These baths are famous for being not very safe there. Rumor has it that the management uses illegal methods of wiretapping and other surveillance there to blackmail unlucky lovers of steam rooms and negotiations in an informal setting.
Stanislav Magomedov received a share in OOO F.O.N. after the death of Machulsky. In the same 2017, Fonbet was restructured: 35% of the company remained in Russia and were distributed among such founders as Magomedov, and the remaining 65% were hidden behind a number of Cyprus offshore companies with a nominee director. Here is what The Bell writes about the owners, “The beneficiary of 65% of Fonbet is hiding behind the Cypriot companies, their main ultimate owner is the nominee Cypriot director. The name of the real owner of this share is unknown to the vast majority of top managers of betting companies and people familiar with this business who have been interviewed by The Bell. The only one, who said that he knew the beneficiary of Fonbet, refused to give that name.”
The physical security of Fonbet management was provided by Jafar Abuev (aka Jeff), who at that time was an adviser to the chairman of Dagestan government (now a deputy representing the United Russia Party in the parliament of Dagestan). Despite a high official position, Jafar Abuev is a typical ‘entrepreneur’ of the 90s who, by force, gained actual control over the North Caucasus Railway.
The main successor to the Russian business of Anatoly Machulsky (OOO Gemma Lux) was his daughter Vasilisa. His second daughter, Sofia Machulskaya, a citizen of Russia and Israel, owns the Bulgarian company of her father. After Machulsky’s death in 2017, Magomedov also appeared to be a co-owner of Fonbet, and Sofia Machulskaya began to take an active part in the business life of the US and the UK. She has companies in Luxembourg and Panama.
However, Machulsky was not the sole owner of the company. In the early 2000s, he brought Alexey Khobot to the business, who in 2003 was the CEO of Fonbet and was actively involved in the operation of software of the www.fonbet.com website.
Alexey Khobot’s son owned another bookmaker with a small turnover of 100 million rubles. Market sources believe that it is Alexey Khobot who now represents the Machulsky’s family – he and the grandmaster’s daughters own 65% of the shares that are hidden in Cyprus.
Novye Izvestia claim that according to the rumors Khobot designed the scheme of Fonbet's existence as two entities (legal and illegal) and actively lobbied for the preservation of such a structure despite the laws, preferring to ‘settle issues’ outside the legal area, attracting people associated with government agencies and the mafia. Only the official net profit of Khobot and Machulsky's daughters per year may be as high as 6 billion rubles, this is the profit from the games that are played on official resources registered in Russia. Hobot invests his income obtained in this way into the Cyprus village of Coral Bay.
It is noted that Khobot renounced Russian citizenship in favor of Cyprus and Israel in 2016 in order to more securely hide behind the nominal beneficiary Greek Antonis Zertalis. However, he owns not only the official part of Fonbet, which brings official income and pays taxes in Russia. The thing is that Fonbet evades paying taxes on profits earned from about half of the gamblers.
Here is how the Fontanka newspaper described the situation in 2018, “Market players explain that the betting market now actually exists in two Internet domains – .ru and .com domains. Everything that goes through .ru domain is officially registered and is reported. The .com domain is actively blocked by Roskomnadzor. The representative of the betting industry answered the questions that had arisen, “Neither Roskomnadzor nor the tax service can prove anything, and it is unlikely that Fontanka will succeed.” The head of the First Self-Regulatory Organization of Bookmakers Yuri Krasovsky reported that about 490 billion rubles came from the illegal sector, i.e., the .com domain. The illegal fonbet.com belongs to a Panamanian company but its director is the already mentioned Anthony Zertalis.
Fonbet’s legal and illegal websites are almost identical. The structure of corporate governance has much in common too. The secretary and president of fonbet.com, which is banned in Russia, is jewelry designer Anita Sondore. She is also the director of LEONUM LIMITED, which owned websites banned in Russia. 25% of LEONUM LIMITED belonged to Kaplan Company, through which the money of an illegal casino went. Such a direct legal connection (the same people in the management of the legal and illegal Fonbet) have always been creating serious risks for the main official Fonbet but these risks are offset by active GR-work.
It was illegal business that caused a serious shakedown in the company, when in 2014 a number of ‘shadowy’ bookmakers had serious problems – on February 20, a criminal case was opened under part 2 of art. 171.2 “Illegal organization and conduct of gambling with the extraction of income on an especially large scale.” The Investigative Committee did not name specific suspects, only “unidentified employees of OOO F.O.N.” were mentioned. According to the investigation, only from June 27 to July 18, 2013 (i.e., for three weeks) the income of OOO F.O.N. from the shadowy website fonbet.com amounted to 60.9 million rubles.
As Vedomosti wrote then, “The Main Department of Economic Security and Anti-Corruption of the Ministry of Internal Affairs initiated a criminal case against unidentified employees of Fonbet. Unidentified employees were accused of having Fonbet branches accepting Internet bets that were prohibited in Russia at that time. The general director of the company Igor Khokhlov was given two-year probation, and the case was closed.”
In our system, according to Novye Izvestia, two-year probation for a nominee director means only one thing – the parties were able to come to agreement. The materials of the criminal case clearly show how the investigation tried to “not to see” the general picture. A scapegoat Igor Khokhlov, for example, used the premises rented by ZAO F.O.N. from OOO Gemma Lux (remember that that was Machulsky’s company) to install in them three payment terminals interacting with the fonbet.com website, which is associated with Machulsky and Khobot. Nevertheless, these relations did not interest the investigators. As it is noted, it was at this moment that the share of the Machulskys family and the share of Khobot were concealed, and in addition to the reputable founders, the conglomerate of “problem-solvers” came to the company.
First, the company was re-assigned to one of the Fonbet’s largest franchisees, a native of the Caucasus Maxim Kiryukhin. Even nowadays, he remains the chairman of the board of directors and the public figure of the company, but today his share, according to SPARK, has decreased to 8.67%.
Kiryukhin brought new partners to Fonbet – people associated with the famous inventor and manufacturer of ‘terminals’ (slot machines) Igor Khodorkovsky. His terminals were installed in stores and at bus stops throughout Russia. The cost of such a terminal was about $500, and this amount paid off within two weeks maximum, even in the most remote town. When the number of the installed devices exceeded one million, the public seriously started talking about the total “terminal” gambling addiction.”
Another shareholder of OOO F.O.N. is Irina Borodina. She does not have any serious business in Russia but she is connected to the ‘problem-solver’ of international level Alexander Burtakov. In Russia, Alexander Burtakov had FLINT KSI Company engaged in “activities for the organization and conduct of gambling and betting” with an authorized capital of 715 million rubles. Intellectual developments of the company were assigned to a company with the similar name Flint-K, the founder of which is Vladislav Kiriyanov, who is believed to be the Burtakov’s right-hand man. Earlier, the owner of the company was Igor Khodorkovsky, the same inventor of the ‘terminals’, and Sergey Kochura was the general director of Flint-K.
Burtakov’s companies also appeared in the “Panama dossier”. Alexander Burtakov owns many companies in Monaco, the US, Panama, Malta, and the UK. Like Khobot, he renounced Russian citizenship and appeared as an Israeli citizen in all the documents that we discovered. It is noted that it was Burtakov who stood behind the Kaplan Company, a co-owner of LEONUM LIMITED. It owned the websites of the illegal part of Fonbet. Through the royalty system, the laundered money was transferred to the foreign accounts of the beneficiaries.
It is noted that Burtakov is not shy and loves to boast of close ties with senior officials of the presidential administration and other high offices, telling about personal acquaintances with the wives of the high and the mighty, as well as representatives of law enforcement agencies, including the head of the Russian Guard Zolotov. It is believed that it was for the ‘problem solving’ that the bookmaker Burtakov was taken to Fonbet, where his GR budget didn’t exceed $5 million a year.
Skeptics, however, have doubts that Burtakov has real ties. Yet, the situation of 2013, when Fonbet emerged from the criminal case with minimal losses, as well as the current scandal with the bookmaker, indicate that the company's GR budget is not wasted.
At the end of 2017, the rights to the Fonbet trademarks were sold. During the transaction, the correspondence address was 7 Likhachevsky Lane, Moscow. Earlier, the address belonged to OOO Kompaniya Klassicheskoe Mezhdunarodnoe Programmnoe Obespechenie (Classical International Software Company), which was owned by the Moscow Federation of Freestyle Wrestling, which, in turn, [was chaired] by A. D. Sukhanov, a business partner of the authoritative athlete Andrey Slushaev (Slon (Elephant)). The same address is specified for the companies of Igor Khodorkovsky (KSI Corporation) and Alexander Burtakov. In the early 2020, the rights to the name “Fonbet” were transferred to TM&Ipco Ltd registered in the UK and owned again by Maxim Kiryukhin, Stanislav Magomedov, and Alexander Burtakov.
The question that worries many people in Russia today is “why did the street hustlers and highway robbers get the opportunity to influence the state agenda?” This is the most difficult and important issue that should be asked not only by the media and by Telegram channels but also by the whole society.