Timchenko is an oil and gas trader, and it is alleged that the company which he co-founded, the Gunvor Group, transferred funds from corrupt Russian deals through the U.S. financial system. The funds relate to transactions in which Gunvor bought oil from Russia’s Rosneft’ NK OAO (MCX:ROSN) (OTCMKTS:RNFTF) in order to sell it to third parties.

U.S. Money Laundering Probe Into Putin Ally

The probe is sure to further anger the Kremlin following the recent period of deterioration in U.S.-Russian relations, due to the Russian annexation of Crimea and the war in Ukraine.

Putin’s involvement

The official line from Gunvor has always been that Putin does not benefit from company activities. It would seem that the U.S. sees things differently, having sanctioned Timchenko back in March. At the time U.S. officials claimed: “Timchenko’s activities in the energy sector have been directly linked to Putin. Putin has investments in Gunvor and may have access to Gunvor funds.”

The Wall Street Journal included a source which claimed that Putin’s personal wealth was under investigation, to investigate any connection to the illicit funds. Links between Putin and Gunvor have long been rumored, and Russian political scientist Stanislav Belkovsky claimed that Putin had secretly amassed a $40bn fortune as the beneficial owner of a 75% stake in Gunvor.

The relationship between the Putin and Timchenko is rumored to have begun in the KGB in the 1990s, although no concrete details are known. What is certain is that Timchenko has become immensely rich, with Forbes estimating his wealth at $15.3bn.

Explosive growth

The Gunvor Group grew slowly in the first few years after it was founded in 2000, before the dismantling of Putin’s enemy Mikhael Khodorkovsky’s company Yukos allowed it to grab a larger market share in 2003. From here revenues grew immensely, from $5 billion in 2005 to $43 billion in 2007, at a rate which commentators maintain would be impossible to achieve without a lot of friends in high places.

Gunvor has since claimed that it finds itself in the “political crossfire” and has never flouted the law. The Kremlin has spoken out on the affair as an attack on Putin, with spokesman Dmitry Peskov claiming: “The west does it continuously. And we cannot express anything but bewilderment.”