A former top executive at Russian natural gas producer Novatek has been convicted of tax evasion in the United States.
Mark Gyetvay, who was deputy chairman of Novatek’s management board and its chief financial officer, was convicted of making false statements to U.S. tax authorities, failing to disclose offshore accounts, and failing to file tax returns, the U.S. Justice Department said.
According to court documents and evidence presented at his trial, Gyetvay from 2005-15 “concealed his ownership and control over substantial offshore assets and failed to file and pay taxes on millions of dollars of income,” the Justice Department said in a news release on March 28.
Gyetvay, who lives in Naples, Florida, worked as a certified public accountant (CPA) in the United States and Russia before becoming the chief financial officer of Novatek, a large Russian gas company.
Beginning in 2005, Gyetvay opened two accounts at a bank in Switzerland to hold assets amounting to more than $93 million, the Justice Department said.
“Over a period of several years, Gyetvay took steps to conceal his ownership and control over these funds, including removing himself from the accounts and making his then-wife, a Russian citizen, the beneficial owner of the accounts,” the department said.
Additionally, despite being a CPA, Gyetvay did not file his 2013 and 2014 U.S. tax returns and did not file documents on foreign bank accounts, as required, to disclose his control over the Swiss accounts.
As an American citizen, Gyetvay is required to pay U.S. taxes on his worldwide income, even if he spends most of the year in Russia.
At the time of his arrest in September 2021, Gyetvay called the charges “baseless” and said he had already settled them through a voluntary program. He vowed then to vigorously fight the charges.
Gyetvay was the face of Novatek to the Western investment community for more than a decade, conducting the quarterly earnings conference calls with stock and bond investors, as well as speaking at industry conferences. He now faces more than 10 years in prison at his sentencing on September 21.
Novatek is Russia’s largest independent natural gas producer and analysts say its phenomenal rise from a bit player in the early 2000s to a company that was once valued as high as $79 billion was in large part due to the company’s connections to the Kremlin.
Gennady Timchenko, a major shareholder in Novatek, is considered a close associate of Russian President Vladimir Putin. Their friendship goes back to the early 1990s.
"Timchenko’s activities in the energy sector have been directly linked to Putin," the United States said in a 2014 statement sanctioning Timchenko. Putin has investments in oil trader Gunvor in which Timchenko had been a major shareholder and may have access to Gunvor funds, the United States said.
Timchenko sold his stake in Gunvor shortly before the sanctions were imposed.