Former World Tour cycling team owner Oleg Tinkov, also known as Oleg Tinkoff, has been forced to pay over $500 million to the US authorities as part of his settlement of a tax case there following his conviction. He was also "sentenced to time served and one year of supervised release".
According to the US Department of Justice, Tinkov was sentenced yesterday "for his felony conviction for filing a false tax return" and as part of finalising that case he paid $508,936,184.
The Department of Justice said the sum was "more than double what he had sought to escape paying to the US Treasury through a scheme to renounce his US citizenship and conceal from the IRS large stock gains that he knew were reportable".
Between 2013 and 2016 Tinkov owned the Tinkoff-Saxo cycling team that included stars like Alberto Contador and three-time world champion Peter Sagan on its roster. The Russian ran into trouble with the US authorities when he renounced his US citizenship in 2013.
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Tinkov was indicted just over two years ago for "willfully filing false tax returns" and was arrested in February of last year in London, with the US seeking his extradition. However, the Russian businessman contested his extradition to the US on health grounds.
He said he was "undergoing a UK-based intensive treatment plan for acute myeloid leukemia and graft versus host disease" which meant he was unable to safely travel.
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On October 1st of this year he entered a plea to one count of filing a false tax return, arising from the fortune he made from the online bank - Tinkoff Credit Services (TCS) - which he founded in 2005-2006.
In October 2013, TCS held an initial public offering (IPO) on the London stock exchange and, according to the US authorities, Tinkov sold part of his interest in the business for $192 million, which was part of his total assets of more than $1.1 billion at that time.
"Three days after the successful IPO, Tinkov went to the US Embassy in Moscow, Russia, to relinquish his US citizenship," the US Department of Justice said in a statement yesterday when the case was finalised.
Tinkov was required to declare any sale of assets, as required by anyone worth more than $2 million who is relinquishing their US citizenship, and to pay any taxes owed. However, the US authorities said Tinkov "filled out the expatriation form himself falsely reporting that his net worth was only $300,000".
It added: "On February 26th, 2014, Tinkov filed a 2013 individual tax return that falsely reported his income as only $205,317. In addition, Tinkov did not report any of the gain from the constructive sale of his property worth more than $1.1 billion, nor did he pay the applicable taxes as required by law.
"In total, Tinkov caused a tax loss of $248,525,339, which he has paid in full with substantial penalties and interest as part of his plea, together with tax liabilities for other years."
