US closer to forfeiting seized yacht as judge denies ex-Rosneft chief’s claim

A US judge on Monday ruled that a former chief of Russian state oil and gas company Rosneft cannot plausibly claim to own a $300m (R5.4bn) superyacht that US authorities seized in 2022, in a win for the department of justice.

US district Judge Dale Ho's decision boosts the bid by federal prosecutors in Manhattan for a forfeiture of the 106m Amadea, which could be sold at auction. Congress last year passed a law authorising the transfer of seized Russian assets to Ukraine to bolster its military defences.

Eduard Khudainatov, who led Rosneft from 2010 to 2013, sought to block a forfeiture by claiming ownership of the yacht in late 2023.

However, prosecutors called Khudainatov a “straw owner” for sanctioned Russian billionaire Suleiman Kerimov, and said Kerimov's niece paid a company controlled by Khudainatov €225m (R4.4bn) in 2021.

In an 80-page decision, Ho said most evidence suggested that while Khudainatov retained “bare title” to the yacht after September 2021, Kerimov was the true owner after that.

“There is a sufficient basis to conclude claimants (Khudainatov) are mere straw owners of the Amadea,” Ho wrote.

“Claimants have not established under any standard that they had an interest in the Amadea other than bare title.”

Khudainatov's lawyer Adam Ford said his client plans to appeal.

“The court improperly relied on speculative and unreliable assertions from the government while failing to give due weight to the extensive evidence we presented,” Ford said.

A justice department spokesperson did not immediately respond to a request for comment.

Washington's diplomatic stance towards Moscow has shifted substantially since US authorities seized the Amadea in 2022.

The seizure came as former Democratic president Joe Biden's administration ramped up sanctions enforcement against people close to Russian President Vladimir Putin to pressure Moscow to halt its war in Ukraine.

When Republican President Donald Trump took office, attorney general Pam Bondi disbanded Task Force KleptoCapture, whose many actions targeting Russian oligarchs included high-profile cases such as the Amadea seizure.

On February 28, Trump assailed Ukrainian President Volodymyr Zelensky as lacking gratitude for US aid. Trump on March 3 paused military aid to Kyiv altogether.

Zelensky had enjoyed warm relations with Biden, and has said he could salvage his relationship with Trump.

Kerimov and his family are worth $10.9bn (R199bn) according to Forbes magazine, after he amassed a fortune through Russian gold miner Polyus.

He was sanctioned by the US treasury department in 2014 and 2018 over Russian activities in Syria and Ukraine.

Prosecutors said he violated the sanctions by making more than $1m (R18.3m) of maintenance payments on the yacht.

Khudainatov is not subject to US sanctions. Ford has said prosecutors had no witnesses to establish  Kerimov owned the Amadea.

“There's simply nothing to connect Suleiman Kerimov to the vessel,” Ford said at a January 21 court hearing.

At the hearing, prosecutor Rachel Doud said  after the 2021 payment, Kerimov's family had sole use of the Amadea, using it for Mediterranean and Caribbean trips, and had been planning major renovations. The Amadea is docked in San Diego, and the US government is paying around $600,000 (R10.9bn) a month to maintain it, prosecutors have said.

Reuters