Shortly after taking over the tobacco industry in Belarus, the oligarch donated luxury cars to the Lukashenko regime


In 2018, Belarusian dictator Alexander Lukashenko radically restructured the country’s tobacco industry in favor of his close friend Aliaksei Aleksin, until then best known as an energy mogul.

Just months after receiving the favors, Aleksin made an expensive gift of nine cars and motorcycles to Lukashenko’s bodyguard service, OCCRP found. The donations, worth an estimated $ 1.5 million, were discovered by analyzing a new leak of the Belarusian vehicle registration database obtained by Cyber ​​Partisans, a group of pro Belarusian hackers. -democracy.

Lukashenko has been seen in vehicles that closely resemble those donated by Aleksin, including a vintage 1967 GAZ-69, a classic Soviet car he used to give Russian President Vladimir a personal visit to his hometown. Putin.

surveys / Vintage-1967-Soviet-GAZ-69.jpg

Credit:
Planetpix / Alamy Stock Photo

On October 12, 2018, Belarusian President Alexander Lukashenko gave his Russian counterpart, Vladimir Putin, a tour of his native village, Alexandria, in a vintage 1967 Soviet GAZ-69. The car appears to be the same.

Nerijus Maliukevičius, a Lithuanian political scientist who studies Belarus, said the lavish gifts create the appearance of a quid pro quo.

“When luxury vehicles are bought for politicians or institutions, it looks like a Russian bribe […] In a democracy, this would be followed by resignations and scandals. In Russia or Belarus, it’s a daily routine, ”Maliukevičius said.

Aleksin declined to comment on the car donation. Lukashenko’s administration did not respond to a request for comment before publication.

King of smoke

Until recently, the Belarusian tobacco industry – which centers around the large Neman tobacco factory in the west of the country – was almost entirely state-controlled, a legacy of the country’s history as a Soviet republic with planned economy.

But in August 2018, Lukashenko awarded Aleksin and his company Energo-Oil the exclusive wholesale rights to all cigarettes made in Neman. Energo-Oil also secured the right to take over the operations of the country’s largest cigarette kiosk chain and obtained a rare license to import cigarettes. In 2020, Lukashenko even redesigned the borders of Minsk so that Aleksin could build a cigarette factory outside the official city limits, “possibly for reasons related to tax evasion,” according to the US Treasury.

It is not clear why Lukashenko actually handed over one of the country’s largest industries to Aleksin, who had never worked in the sector before. According to the Energo-Oil website, the company only got involved in tobacco in 2018.

However, the OCCRP previously detailed how the tycoon rose to fame following a series of EU sanctions against Lukashenko’s inner circle in the early 2010s. Un sanctioned himself, Aleksin was able to continue to doing business in Europe.

Shortly after receiving these favors from the regime, Alexander donated eight vehicles to Lukashenko’s security services in a single day in October. He followed that up with the donation of a ninth car in November.

Some of the vehicles Aleksin donated are very valuable or unique, including:

  • A 2018 BCC Vintage from the Russian company Bilenkin Classic Cars, which specializes in the refurbishment and modernization of classic cars.
  • Two Maybach 62S models, valued at $ 500,000 each
  • A 1958 Chevrolet Impala valued at around 100,000 euros ($ 113,000)
  • A classic Soviet-made 1967 GAZ-96
  • A 2013 Renault Twizy “microcar”
  • A 2017 Harley-Davidson
  • A vintage Jawa 350 motorcycle from 1969
  • A 2015 Spyder F3SM6 three-wheeler

Screenshot of a vintage BCC car
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Credit:
Instagram / Bcc

A photograph of a Vintage BCC car decorated with Belarusian symbols on the company’s Instagram page. After reporters called the company to ask if the car was tailor-made for Aleksin, BCC removed the image from its Instagram page.

Motorcycles and three-wheelers may have benefited Lukashenko’s eldest son Viktor, who is avid biker and Harley-Davidson. In 2019, Aleksin even went with Viktor Lukashenko to a Russian motorcycle rally organized by the Iron Birds, an international motorcycle club that the authoritarian leader’s son co-founded.

Viktor Lukashenko at a festival
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Credit:
Viktor Drachev / TASS / Alamy

Viktor Lukashenko at a HOG festival for owners of Harley-Davidson motorcycles in Minsk in 2018.

Laurynas Boguševičius, director of Deals on Wheels, a car dealership based in the Lithuanian capital of Vilnius, estimated that the vehicles donated by Aleksin could be worth up to 1.5 million euros (around 1.7 million dollars). He said the two Maybachs were particularly valuable and could even fetch more than the listed price.

“These cars are so rare and so few have been produced that their price is as high as the seller wants,” BoguÅ¡evičius said in Siena.

Smuggling peak

It is unclear how much Aleksin could have benefited from its new monopoly on the distribution of cigarettes since Belarus does not publish statistics on its tobacco industry. But the profits posted by its main company, Energo-Oil, suggest that the sums at stake are significant. The company, which is in charge of wholesaling the Neman cigarette factory among others, reported 280 million Belarusian rubles (about $ 115 million) in net profit last year, with sales of ‘worth over $ 600 million.

At least some of this money appears to be related to contraband. The Neman factory has long been infamous for the production of inexpensive cigarettes which are imported into Europe as contraband. But the OCCRP found that Aleksin’s takeover of the factory’s wholesale trade coincided with a record spike in Neman-made cigarettes smuggled into the European Union via Lithuania, which shares a long land border with Belarus.

Last year, Lithuanian authorities seized 17.2 million packages of illicit Belarusian cigarettes during routine inspections and surprise checks, up from 4.8 million in 2017.

“In recent years, it has become common to discover 1,000 to 1,500 cases [up to 750,000 packs] smuggled cigarettes in a single cargo truck, which was once exceptional, ”said Gediminas Kulikauskas, spokesperson for the Lithuanian Customs Criminal Service.

Belarus also produces far more cigarettes than the country’s domestic market can absorb, raising the question of whether the surplus is destined for contraband sales in EU countries where they are illegal. The Neman factory alone produced more than 30 billion cigarettes last year, but cigarette consumption in Belarus was estimated at just 16 billion cigarettes in 2018, the most recent year for which figures are available.

As he is now the dominant figure in Belarus’ cigarette industry, Aleksin’s companies play a key role in sourcing cigarettes that end up being smuggled.

“Without surplus production and the wholesale monopoly, the current smuggling system could not exist – not on such a large scale at least,” Kulikauskas said.

Aleksin categorically denies any involvement in smuggling. “These are just rumors, and someone is spreading them,” he told OCCRP in a brief telephone interview earlier this year.

In response to yet another wave of violent crackdowns on pro-democracy protesters last year, the US has followed the EU and Canada in sanctioning Aleksine, noting his “virtual monopoly on the production of tobacco products in Belarus ”.

The US Treasury said it was one of Lukashenko’s “wallets”, providing the dictator with “funds to possibly enrich [him] personally and fund his corrupt and brutal regime.

In return, Aleksin and other oligarchs enjoy preferential access to state resources, tax breaks and other favors, creating a network of patronage that “supports the violent Lukashenko regime at the expense of the people.” Belarusian, ”the Treasury Department said.

The United States has also sanctioned the Neman factory itself, stating that “Neman’s brands are among the most commonly smuggled cigarettes into the EU.” Marius Laurinavičius, a Lithuanian political analyst, said cigarette smuggling appears to be a key part of Aleksin’s business model – but also benefits the Lukashenko regime more generally.

“Smuggling in these countries cannot happen without a so-called ‘roof’ [protection] government, ”he said, adding that smuggling cigarettes is a key part of Aleksin’s business and the illicit trade benefits the regime.

“He does business for people who can’t officially do it,” Laurinavičius said.

Siena (Lithuania) and the Belarusian Investigation Center (Belarus) received support from IJ4EU for their reporting.



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