German resort’s rift over Russian oligarch resonates across country
A German politician mobilized a protest against a now sanctioned Russian resident in his resort town. This has drawn a following but also angry emails, and a threatening telephone call.
This is a reflection of Germany’s inability to become a refuge for wealth in a culture which values privacy, but critics claim has allowed the mega-rich hide assets.
While Spain, France, Italy, and Spain have taken yachts and other properties from Russia’s invasion and subsequent sanctions, Germany seems to have been unable to do anything about it.
“For many years, Germany has been a magnet to dirty money from all around the globe. We didn’t look close enough for too long and are now suffering the consequences,” Lisa Paus (a member of Germany’s parliament) said.
The government is just starting to set up a task force to enforce sanctions.
Germany’s turbulent relationship with oligarchs has put a spotlight on the Bavarian lakeside community of Tegernsee. Locals and officials claim that at least three homes are owned by Alisher Usmanov, a Uzbekistani-born businessman.
When sanctions were imposed on Usmanov, the European Union described him as a “proKremlin-oligarch with close ties to Russian President Vladimir Putin”.
USM, his holding company, describes Usmanov on its website as an investor, entrepreneur and “one the most generous philanthropists in the world”. However, they did not respond to our requests for comment. He also owns two other companies that he did not reply to.
Thomas Tomaschek was a member the council Rottach-Egern at Tegernsee’s southern tip. This month, he called a demonstration to declare Usmanov no longer welcome, despite the fact that restaurants, carpenters, and hoteliers have profited from him being there.
The event attracted 300 people representing all political parties from a town of just 5,000. However, there was also backlash.
Tomaschek claims he was sent an email by a friend shaming him for showing support “against Russians who clearly live as private persons in Rottach–Egern.” Another wrote: “Should anyone shaking Putin’s hand be stripped of assets in Germany?”
One caller shouted “Nazi Pig” down the telephone, prompting him file a complaint. He also requested that he remove an axe to chop wood from his front yard in case of violence. Local police confirmed that they were investigating.
Angrily grass roots activists are now drawing attention Germany’s incompetence when it comes to seizing assets.
Mathis Lohaus, a researcher from Freie Universitaet Berlin, was outraged to learn that no one had seized a superyacht, which the United States claims is Usmanov’s, and was berthed at Hamburg port.
Lohaus stated that he took to Twitter in frustration at Germany’s failure to seize the ship. It has an indoor pool and two helipads, and is worth more than $600million.
Lohaus stated that Germany’s history has been one of “unenthusiastic enforcement” for the past few years.
A spokesperson for Hamburg’s economics minister said that the yacht has not been confiscated.
A prominent campaign group against financial crimes has launched a petition to Christian Lindner, the German Finance Minister, asking for action.
“Germany offers them all safe havens for their dirty money. This must stop! The petition is called “Finanzwende”. In an email response to Reuters, the finance ministry stated that it was working on clamping down.
Germany’s problems with enforcement are partly due to bureaucracy and the spread of responsibility across ministries.
Germany announced last week that it would create a task force to supervise the implementation of sanctions across its economy, finance and interior ministries as well as customs and law enforcement.
Cultural and historical factors are also at play.
Hartmut Baeumer is a former judge who now chairs Transparency International Germany. He said that Germans are very risk-averse when confronting legal issues. However, they believe in strong protection for individual rights.
“We Germans still have to deal with the effects of the Nazi era. Baeumer stated that the pendulum has moved in the right direction towards privacy and individual freedoms.
German and international elites have sought refuge in the hills surrounding Tegernsee. It is located between Munich and The Alps. Rottach-Egern claims that it is Europe’s first beautyfarm and has “first-class, elegant” hotels.
The Rottach-Egern average home price was over 4 million euros according to a popular real estate portal. However, the average German taxpayer pays 66% less income tax than the rest of Germany.
A prominent local businessman stated that Tegernsee was a place for billionaires under the condition of anonymity.
Gerhard Hofmann was Rottach-Egern’s city manager. He said that he had never seen such a scene in his hometown.
Hofmann stated that Usmanov wanted “just to have his peace” and added that the oligarch had contributed to the local economy through the employment of local architects and businesses.
He added, “As a city, we are neutral.”