Scottish firm linked to Russian invasion put on trade blacklist

Scotland on Sunday

With major international stories dominating the news agenda over the past year, Martyn McLaughlin’s agenda-setting scoop in March 2022 was a textbook example of how the regional press can break vital investigations that are not only of interest to local audiences, but readers around the world.

In the days and weeks after Russia launched its invasion of Ukraine, Martyn set about digging around company formation records. Having spent years writing about opaque corporate structures in Scotland being manipulated to expedite the flow of dirty money, he had a hunch that there could be local connections to a far-flung conflict. He set about methodically combing through the data, while ringing around his contacts, and eventually, made a breakthrough via longstanding sources in Washington DC. The resultant front page story confirmed Martyn’s initial suspicions, and showed the war was not only being waged thousands of miles away, but via the leafy streets of central Edinburgh. His investigation, followed up by Financial Times and The Times, revealed how a Scottish entity known as Djeco Group had been placed on a trade blacklist by the US government, with authorities in Washington accusing the company of supporting the Russian military and security services. Djeco was registered at an address in the Scottish capital’s Thistle Street, but it had no staff there, nor any presence beyond what was on the paperwork filed at Companies House. It was, in short, a ‘ghost’ firm, weaponised to transfer money to Moscow. Martyn’s story broke down complex corporate issues and communicated the key facts with economy and impact. He told readers how Djeco, a Scottish limited partnership, was part of a complex network of companies and holding entities stretching as far afield as Malta. But its purpose was clear - to help bankroll Putin’s military operation. The scandal of a firm registered in Edinburgh being used for such a nefarious purpose raised searching questions about the UK’s lax corporate governance framework. It was also embarrassing enough to jolt authorities here into action; days after Martyn’s report was published, the UK government added Djeco Group to its own sanctions list. Even so, Martyn’s story highlighted the government’s inertia around the misuse of Scottish limited partnerships, and reiterated the need for regulation. As Graham Barrow, a veteran anti-fraud consultant and money laundering expert, told him, the failure to scrutinise companies like Djeco had created “a perfect storm of opportunity for obfuscation and opacity.” Dale Miller, head of news at Scotland on Sunday and The Scotsman, described Martyn’s story as “a compelling exclusive produced on the back of some excellent investigative work.” He said: “Published inside the first month of the war in Ukraine, the piece tapped into heightened fears around Russian influence inside the UK and foreshadowed a crackdown on such companies by the UK and Scottish governments. “Martyn not only uncovered the key line for the exclusive, but was able to break down and explain the complex nature of the case in an authoritative and concise manner for readers.”