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Ross Denies Russia-Linked Investments Are Improper, Says He Is Selling Them


U.S. Commerce Secretary Wilbur Ross (file photo)

U.S. Commerce Secretary Wilbur Ross said he properly disclosed his investment in a shipping firm with links to a company controlled by associates of Russian President Vladimir Putin, and he will probably sell his stake in the firm.

Ross told Bloomberg Television late on November 6 that he has been selling his holdings in Navigator Holdings, a shipping company that transports gas for Russian energy firm SIBUR, but not because of media reports about its connections with the Kremlin.

Sibur is partially owned by Gennady Timchenko, a friend of Putin's who is under U.S. sanctions over Russian aggression in Ukraine, and by Putin's son-in-law, Kirill Shamalov, The New York Times reported.

Ross's private equity firm has been the biggest shareholder in Navigator. His holdings were first disclosed in documents released on November 5, dubbed the Paradise Papers, by the International Consortium of Investigative Journalists (ICIJ), which also showed that state-controlled Russian giants Gazprom and VTB Bank made large investments in U.S. tech firms.

Ross's personal share of Navigator Holdings was reduced when he took office in February, although his U.S. government filings show he still has holdings valued at $2 million to $10 million.

Ross said in multiple media interviews on November 6 that he had fully disclosed his stake as part of government ethics requirements.

"There was disclosure, there is no impropriety, and if people draw a contrary conclusion that's because the papers have twisted the story and made it into something that is not there," Ross told the BBC.

Richard Blumenthal, a Democrat on the U.S. Senate Commerce Committee, said Ross had deceived the public as well as lawmakers who had confirmed his appointment to U.S. President Donald Trump's cabinet after he promised to divest holdings that posed conflicts.

Blumenthal, appearing on MSNBC, called for an investigation and hearings.

"If he fails to present a clear and compelling explanation, he ought to resign," Blumenthal said.

The investigative journalism group that released the Paradise Papers was also behind the release of the so-called Panama Papers in 2016, which also featured detailed information on offshore accounts of many world leaders and wealthy individuals.

The Paradise Papers material came from two offshore service providers and the company registries of 19 tax havens. It was obtained by the German newspaper Sueddeutsche Zeitung and shared by the ICIJ with partners including The Guardian, the BBC, The New York Times, and dozens of other news agencies that analyzed the information.

The documents were shared with multiple news outlets because of the high volume of information involved in what was called Project Paradise.

Ross was among the biggest names involved in examinations of the first batch of the 13.4 million files. There was no indication his investments were illegal, although Ross's connections to Russian interests could increase the scrutiny that the Trump administration is already facing and lead to questions about conflicts of interest.

Potential links between Trump associates and Russia have come under scrutiny amid multiple U.S. investigations into Moscow's alleged interference in the 2016 U.S. presidential election and the question of whether associates of Trump may have colluded with Russia. The U.S. president denies there was any collusion and has called the probes a "witch hunt."

Complex Web Of Companies

The New York Times reported that Ross's stake in Navigator Holdings has been held by a complex web of companies in the Cayman Islands.

Commerce Department spokesman James Rockas said Ross "was not involved with Navigator's decision to engage in business with SIBUR, a publicly traded company, which was not under sanction at the time and is not currently.

"Moreover, Secretary Ross has never met the SIBUR shareholders referenced in this story and, until now, did not know of their relationship," he added.

Russian Social-Media Investments

In another revelation involving Russia, the ICIJ said the documents show that Yuri Milner, a Russian citizen who is a large investor in Silicon Valley tech companies, got $191 million from the state-controlled VTB Bank and invested the money in Twitter. The New York Times reported that the backing of VTB, which Russia often uses for "politically strategic deals," was "obscured by a maze of offshore shell companies."

Russian billionaire Yuri Milner in 2015
Russian billionaire Yuri Milner in 2015

The documents also show that a financial subsidiary of Gazprom, the state-controlled Russian natural-gas giant, funded a shell company that invested in a company that was affiliated with Milner and held roughly $1 billion in Facebook shares shortly before Facebook's 2012 initial public offering.

Russian-backed fake-news stories and divisive political ads placed on Facebook, Twitter, and other social networks have become a major focus of the U.S. probes into what U.S. intelligence officials have said was a campaign ordered by President Vladimir Putin in an effort to undermine faith in the U.S. electoral system, denigrate Democratic 2016 presidential candidate Hillary Clinton, and help Trump.

Milner told the ICIJ that he was unaware of any involvement by Gazprom subsidiary Gazprom Investholding in any of his deals.

In an open letter on November 6, he said any suggestions of attempting to influence U.S. politics would be "so far-fetched, it's hard to take them seriously."

"The idea that we were working on Russia's behalf to turn social media against U.S. democracy is a fairy tale, for many reasons," he wrote.

"The events surrounding last year's election are a serious matter indeed, and having grown up behind the Iron Curtain, I have a particular appreciation for democratic institutions," Milner added.

The ICIJ also said that Milner more recently invested $850,000 in Cadre, a real estate fund that was co-founded by Trump's son-in-law and adviser Jared Kushner, according to the Paradise Papers. Milner told the ICIJ that he used his own money for the investment.

With reporting by the BBC, AP, The Guardian, dpa, AFP, Bloomberg News, and The New York Times
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