French Billionaire And CEO Of LVMH, Bernard Arnault and Russian Oligarch Nikolai Sarkisov Under Investigation for Suspected Money Laundering

French billionaire Bernard Arnault and Russian oligarch Nikolai Sarkisov are currently under a “preliminary investigation” for their suspected involvement in transactions that may constitute money-laundering offences, as confirmed by the Paris Public Prosecutor’s Office; the development corroborates previous reports from the French publication Le Monde.

It’s important to note that, as part of this preliminary investigation, Bernard Arnault is not considered a suspect and has not been accused of any wrongdoing.

However, the Prosecutor’s Office has revealed that they have included a memo from the French Ministry of Economy’s financial intelligence unit, Tracfin, concerning real estate transactions involving both Arnault and Sarkisov in an ongoing preliminary investigation into Sarkisov’s activities in France, initiated in 2022.

According to Le Monde, which claims to have seen the memo, Tracfin sent it to the Public Prosecutor’s Office in Lyon in December 2022; subsequently, the case was swiftly transferred to the Paris prosecutor’s office, which requested assistance from the national-level anti-money-laundering authority to delve into the matter.

Le Monde reports that, according to the memo, companies owned by Sarkisov acquired fourteen properties in the upscale Alpine resort of Courchevel in the fall of 2018 for a total of 16 million euros ($17 million); the same was achieved through a complex network of companies based in France, Luxembourg, and Cyprus.

The memo stated that Sarkisov’s name did not appear on the records of the purchasing company, SNC La Fleche, even though Tracfin identified him as the actual owner through several holding companies. 

During the same period, SNC La Fleche acquired three additional properties in the same area from a company called SNC Croix Realty for 2.2 million euros; Sarkisov also had ownership of SNC Croix Realty at that time, according to Le Monde. The memo disclosed that SNC Croix Realty made a profit of 1.2 million euros from the resale of these units, which they had purchased a year earlier.

Tracfin also raised suspicions that French billionaire Bernard Arnault had provided a loan of 18.3 million euros ($19.4 million) to Sarkisov for this transaction through his private holding company, as reported by Le Monde; according to the French newspaper, Arnault subsequently acquired La Fleche in December 2018.

As per Le Monde’s report, the Tracfin memo elucidates that Arnault initially loaned the amount to one of Sarkisov’s companies before taking possession of the company that owned these assets. The investigation will need to ascertain the reasons behind this apparent inconsistency and explain why Arnault engaged Sarkisov as an intermediary in these transactions.

Tracfin investigators expressed their suspicions of “money laundering,” stating that the alteration of the final beneficial owner of the real estate acquisitions aimed to obscure the source of the funds, complicate the transactions and the identification of the true buyer, and conceal the actual beneficiary of these transactions, i.e., Bernard Arnault.

In response to these allegations, a source close to Arnault asserted that the transaction had been conducted in strict compliance with the law, claiming that, as with any real estate transaction, various legal parties were responsible for ensuring compliance with all existing regulations.

Sarkisov’s team informed Le Monde that the Russian businessman had no direct involvement in these transactions, and at the time, there were no known business ties between the two men.

It’s worth noting that Sarkisov is not listed on the European Union’s sanctions list in response to Russia’s invasion of Ukraine in February the previous year.

The LVMH Empire

Bernard Arnault is currently the second-richest person globally, the first being Elon Musk, with a net wealth of $164 billion, according to the Bloomberg Billionaires Index.

Arnault is the chairman and CEO of LVMH, one of Europe’s largest conglomerates, which includes luxury fashion and beverage brands such as Louis Vuitton and Moet & Chandon. 

He acquired a controlling stake in LVMH in 1989, just two years after the merger of Louis Vuitton and Moët Hennessy, and has held his position ever since. 

Under his leadership, LVMH has grown into a dominant force in the luxury goods sector, boasting 75 brands covering various industries, including wine, spirits, fashion, leather goods, perfumes, cosmetics, watches, jewellery, luxury travel, and hotel accommodations.

Bernard Arnault’s companies, primarily those under the umbrella of LVMH (Moët Hennessy Louis Vuitton), are well-regarded in the luxury goods industry and are known for their exceptional quality, craftsmanship, and brand prestige. 

Here are some key aspects of Arnault’s companies and their brands:

LVMH (Moët Hennessy Louis Vuitton): LVMH is the overarching conglomerate founded by Bernard Arnault, which includes a wide range of luxury brands and businesses, including fashion houses, perfumes, cosmetics, watches, jewellery, wines, and spirits.

Some of the notable brands within LVMH include:

• • Louis Vuitton: Known for its iconic LV monogram, Louis Vuitton is one of the most recognized luxury fashion brands globally, specializing in leather goods, luggage, and fashion accessories.

• • Christian Dior: Dior is renowned for its haute couture and ready-to-wear fashion lines, along with fragrances and cosmetics.

• • Moët & Chandon, Dom Pérignon, and Veuve Clicquot: These are prestigious champagne brands.

• • Givenchy: A luxury fashion and perfume brand known for its elegant designs.

• • TAG Heuer, Hublot, and Bulgari: These are luxury watch brands within the LVMH portfolio.

• Sephora: LVMH also owns Sephora, a multinational cosmetics and beauty retailer with a vast presence in various countries.

• Fendi: Another renowned luxury fashion brand known for its fur products, leather goods, and ready-to-wear collections.

• Celine: A high-end fashion brand recognized for its minimalist and sophisticated designs.

• Kenzo: Known for its colorful and artistic fashion designs and fragrances.

• Guerlain: A prestigious French perfume, cosmetics, and skincare brand.

• Berluti: Specializes in men’s luxury footwear, leather goods, and ready-to-wear.

• Rimowa: A German luxury luggage and suitcase manufacturer.

• DFS (Duty-Free Shops): LVMH owns DFS, a chain of duty-free stores in airports and downtown locations, offering luxury products.

• Cheval Blanc: LVMH also operates a collection of luxury hotels, including Cheval Blanc, known for its exceptional hospitality and premium experiences.