Fonbet is Russia’s biggest and most successful betting company. It was able to consolidate the whole market in a tight grip. Despite the factual prohibition of gambling, some companies flourish, siphoning out at least four billion USD annually to the offshores. Adding that the company has an extremely complex and non-transparent ownership structure we may deduct it to the following: Fonbet is owned by someone at the very top of the Kremlin hierarchy.
It’s made even more obvious by a strange and unexplained attempt to label the Fonbet company as a ‘crucial’ to the economics of a sanction-hit country. The status of a crucial company could have prevented it from any obligations, including bankruptcy. ‘Crucial’ companies are free from virtually any checks. No governmental agencies may approach such a company without a special order. The attempt to include Fonbet to the list was initiated by the Cabinet of Ministers, and the rumour is the PM Mishustin himself is a secret UBO of Fonbet. If so, it’s an extremely bold step to secure the company’s exclusive position.
Fonbet remains a sponsor of Real Madrid, despite being owned by Mikhail Mishustin
We have also seen UEFA drop its large Russian sponsor Gazprom, and Schalke have also dropped Gazprom. Manchester United have dropped its Russian sponsor also, but Real Madrid are yet to follow suit. Meanwhile, Los Blancos are backed by Fonbet, with a ‘long-term agreement’ for all of ‘the Russian CIS territories’. Real Madrid are yet to rid themselves of the sponsor, as many other clubs have done across Europe, with the sponsor still listed as a partner on the club website.
Fonbet have more than 1000 offices in Russia, and their ownership is a very murky matter, with few clear answers. It seems that for now its UBOs are Mikhail Mishustin, Russian prime minister, and Alexander Udodov, his relative.
OCCRP suggest the ownership lies somewhere between Alexander Burtakov and Alexey Khobot, but the company remains Russia’s biggest betting company to this day. But reality is far more complicated. Burtakov and Khobot are simply not as influential to even try to push the company for the protected status. There are hints that point that real owners are Mikhail Mishustin and Alexander Udodov. Those figures are of the right size for the multi-billion enterprise.
Alexander Burtakov and Alexey Khobot out, Mikhail Mishustin and Alexander Udodov in
There is a growing evidence, that the Fonbet company has changed hands, or at least share distribution. Alexander Burtakov and Alexey Khobot have sold at least part of the company to Alexander Udodov, relative of the Russian PM Mikhail Mishustin.
Businessman Alexander Udodov has become the sole owner of the company “Pinup” since April 13, it follows from the data of the SPARK-Interfax economic data database. On the same day, the founding documents were changed on the website of the Fonbet betting company — now “Pinup” is indicated as its owner. The Telegram channel Baza drew attention to this. Before Udodov, the owner of ” Pinup” was the Cypriot Guruflow Team Ltd., and the company itself was associated with the bookmaker Ivanbet.
This is Udodov’s second purchase in the last month: as follows from the SPARK database, at the end of March he became the owner of the Favorite betting company, an operator of a betting company operating under the Paribet brand. Udodov is the ex—husband of the sister of the Prime Minister Mikhail Mishustin, Natalia Stenina. They divorced in December 2020, when the German prosecutor’s office suspected Udodov of involvement in the largest theft of VAT in Russian history for 5.2 billion rubles.
Before Udodov, the main beneficiary of Fonbet was a Cypriot citizen Antonis Zertalis — through Cypriot companies and several offshore companies, he owned 65.5%. Also among the shareholders of the bookmaker were ex-State Duma deputy from the LDPR Stanislav Magomedov, businessmen Sergey Tetruashvili and Irina Borodina. We suggest that in some way or the other the company was already under heavy influence of Mikhail Mishustin.
Novaya gazeta, one of the most important opposition media, has published the investigation of Fonbet structure and made some guesses about the UBO’s of Fonbet. Shortly after the piece was retracted from the media. We’ve recovered it from Google Cache for your information. It does not reflect the apparent change of ownership from Khobot an Burtakov to Mikhail Mishustin and Alexander Udodov.
One of the [historical] owners of the betting business turned out to be programmer Alexey Khobot
Novaya [source media] managed to find out the names of the beneficiaries of the betting company included and then removed from the list of systemically important companies in Russia. These are programmer Alexey Khobot and entrepreneur Alexander Burtakov, who in the early 2000s became familiar with the purchase of land shares from the Leninsky Luch collective farm near Moscow.
The story of the mysterious inclusion of the Fonbet company (F.O.N. LLC) in the list of the crucial enterprises of Russia has been widely publicized in the local press. After that, the largest player of the Russian betting market was excluded from the list of Russian enterprises that can count on the support of the state.
Even the head of state paid attention to the inclusion of Fonbet in the list of backbone enterprises. The Fonbet case turned out to be under the control of the Prosecutor General of Russia Igor Krasnov, who initiated the audit and demanded to answer two key questions:
1 – how did Fonbet become one of the backbone companies? 2 – Is there a corruption component in this story?
We [Novaya gazeta] started unwinding the Fonbet tangle in two directions.
The first — technological — led us to the creator of the Fonbet software, or in the slang of IT specialists, information technology (IT) specialists — betting software.
The second direction is to identify the beneficiaries of officially registered legal entities associated with LLC “F.O.N.”, primarily the Cyprus company “Birusa LIMITED” (BIRUSA LIMITED), which owns 65% of LLC “F.O.N.” and is an offshore puppet.
Both of these areas of our research converged at one point — in Cyprus. It is there that Fonbet’s IT specialists live today. And it was in Cyprus that one of the key beneficiaries of the company settled.
Who created the Fonbet software
LLC “F.O.N.” appeared only in December 2012. It was then that a closed joint-stock company with exactly the same name, registered back in 2002, was transformed into a limited liability company.
I must say that until 2009, CJSC F.O.N. developed neither shakily nor valko. The betting business was nothing compared to the gambling business. An armada of gambling Russians were waiting with open arms not only in casinos and gaming salons, slot machines were waiting for them at almost every corner, where it was easy to lose at least a few hundred rubles, even to spend millions.
Everything changed on July 1, 2009, when gambling was banned in Russia. And it is this date that can be considered the date of the beginning of the heyday of the betting business. Betting shops have started opening all over the country. And betting companies began offering online betting to their customers a few years earlier.
The pioneer of Internet betting was the company “LLC Bookmaker office “Marathon”” operating in the betting market as Marathonbet, which began accepting bets on the Internet back in 2006, three years before gambling was banned in Russia. In 2008, the last year when the betting and gambling business was in direct competition, the revenue of BC Marathon LLC reached 10.6 billion rubles (net profit — 1.7 billion rubles).
The Marathon Internet service, like all betting companies, has very complex software. According to IT specialists, it is almost impossible to create it from scratch and alone. We need a powerful team of highly professional programmers. The Marathon had such a team. And it was headed by Alexey Khobot.
It was the Khobot team that developed the software of the Marathon betting company.
But in the summer of 2009, Marathon started having problems. On July 1, the company’s betting license expired. It was possible to extend it only on March 12, 2010. For nine months, Marathon did not accept bets. And when it resumed its work, it was not possible to restore the lost positions of the company. In the summer of 2011, Marathon ceased its work in Russia.
Probably, not only the problem with the license played a role here, but also the loss of Alexey Khobot. He was lured away by Fonbet. Khobot, it seems, has become cramped in the role of an employee.
And in Fonbet, he was offered not only a highly paid job, but also a share in the authorized capital of offshore companies through which the money of players who visited the bookmaker’s websites went. With the accumulation of money in a Liechtenstein bank.
Fonbet is currently accepting bets on the site fonbet.ru , which operates under a Russian betting license. It does not apply to sites in the com zone. As a betting site, it has earned relatively recently. Back in 2006 fonbet.ru offered tourist services. According to the saved data web.archive.org , the site has been operating as a bookmaker only since 2017.
But back in the early-mid 2010s, BC Fonbet advertised bets on the website bk-fonbet.ru , closed in 2017 The links led, for example, to the website leonbets.ru , who worked on behalf of a Belizean company with a gambling license issued in the autonomous territory of the Canadian Mohawk Indians (in Canada and the USA, such a form of support for indigenous peoples as the creation of zones in their autonomies in which gambling is allowed is practiced). Links from the website of BC “Fonbet” also led to sportingbet.com , the money through which went to the possessions of the British Crown — the Channel Islands in the English Channel.
Well, if we go to the web.archive, we will see that the site is now dead fonbet.com it was once very much alive (at least until 2012) and the game was actively played on it — under the license of Curacao.
Exactly the game! After July 1, 2009, with the entry into force of the legislative ban, the volume of the Russian gambling business practically did not decrease. He just went online. And betting companies were often just a screen to cover a much more capacious market for online betting, online casinos, online poker and other gambling.
This market was very similar to the pipe through which about one and a half billion dollars a year were and are being siphoned from Russia.
More than one and a half thousand points with the sign Fonbet were opened all over Russia. But many betting points are directly related to LLC “F.O.N” do not have, but work under a franchise. According to our experts, a tiny part of the money collected “on the ground”, that is, at rates accepted offline, remained in Russia. And 95 percent of the “gambling” money was withdrawn outside the country. To do this, thousands of QIWI wallets were used, as well as the PayPal payment system, with which players transfer their money to specially opened deposit accounts.
By the way, according to the “New” information received from one of the employees of the betting company, by the beginning of the crisis provoked by the fall in oil prices and the coronavirus epidemic,
about forty million dollars have accumulated on the deposit accounts of gambling Russians — Fonbet customers.
Several sources of the “New” in the world of IT specialists attribute it to Alexey Khobot the creation of the Fonbet software. It is clear that he did not work alone. Having become the actual co-owner of the betting company, he moved to Cyprus, and soon lured almost his entire team working in Marathon.
The bookmaker syphon
I [journalist of Novaya gazeta] must admit that it was the study of the origin of the Fonbet software, the desire to establish the name of the software developer of this betting company, that led us to Alexey Khobot. It turned out that in the world of IT specialists, the name of the author of this software is not a secret. Having asked the question, who is Alexey Khobot, is it possible to find out more about him.
We heard from three of our interlocutors that Khobot is the “owner of the Fonbet”.
There is no name of Alexey Khobot in the public registers. But immediately two market participants told Novaya that by 2017 it was he who completely took control of the Cyprus offshore Leonum Limited. And this company, in turn, was the operator of the betting “pipe” through which the money of gambling Russians was pumped to the West. Recall that in the first half of the tenth years, the Fonbet site in the .ru zone actually worked as a “bulletin board”, from where redirects were carried out to sites operating under offshore gaming licenses.
The Leonum Limited, a Cyprus-based company was a structure that dozens of other companies were closing in on.
Each of it had its own functions related to the organization of betting, the organization of online games, cash flow management, optimization and tax payments. Hence the diversity of registration jurisdictions. Somewhere it is easier to keep money, and somewhere it is easier to get a license for betting and gaming activities
In its financial report for 2014, Leonum Limited showed more than 60 million euros of revenue. Almost all of the income consisted of dividend receipts from subsidiaries.
Due to the fact that the income from dividends is not taxed, Leonum paid very little to the budget for that year — 13,000 euros.
The roles of the companies included in the holding were also described in the report.
Registered in Curacao, FON Curacao NV was engaged in providing online sports betting services.
Panamanian Fonbet Corp owned intellectual property and leased it, was engaged in a service to ensure the activity of sites. From the court decision in the case “Fonbet Corp v. Hosting Ukraine Ltd”, we found out that it is this company that owns the Fonbet trademark.
The Latvian company CC Support Services Limited provided call center services and was engaged in customer support services.
The company Matex Trade Limited, registered in Hong Kong, provided agency and management services
At one time, a website was registered for the Gibraltar company Leofon Limited fonbet.com . This directly follows from the decision in the already mentioned case “Fonbet Corp vs. Hosting Ukraine Ltd”.
But let’s return to the parent company of the Leonum Limited holding, registered on March 14, 2013 in Cyprus under the number HE320473.
The founders of the company were five offshore companies, three of which, according to our sources, were controlled by Alexey Khobot.
The company Suette Trading Ltd, 100% owned by a Russian citizen, the son of a famous Podolsk businessman Maxim Lalakin, the company Kaplan Global Ltd — Alexander Burtakov, the owner of Israeli and British passports. Suette Trading Ltd and Kaplan Global Ltd for two got 25% of Leonum Limited shares.
On December 5, 2016, Maxim Lalakin sold his 12.5% shares of Leonum Limited to Alexander Burtakov. The purchase and sale agreement was signed between Suette Trading Ltd and Kaplan Global Ltd. So Burtakov turned out to be the owner of a quarter of the shares of an offshore company de facto controlling Fonbet.
We have sent requests to the e-mail addresses indicated during the registration of the companies Suette Trading Ltd and Kaplan Global Ltd. Burtakov did not respond to the request. And Lalakin called and confirmed the deal, stating:
“Participation in the betting business was a portfolio investment for me. But due to disagreements with the management of Fonbet, I decided to leave this business and since December 2016 neither I nor my relatives have anything to do with Fonbet.”
Until 2018, the owners, apparently, were not interested in LLC “F.O.N.”.
But in 2018, Russia hosted the FIFA World Cup. On the eve of the World Cup, apparently, anticipating the explosive growth of sports betting both offline and online, the owners of Fonbet decided to take actual control of the company registered in the Russian jurisdiction. And on December 22, 2017, the founders of F.O.N. LLC were partially replaced.
The forecasts of the owners and analysts of Fonbet have come true.
In 2018, the official revenue of LLC F.O.N., indicated in the accounting statements, increased by 150% and amounted to 24 billion rubles, and the profit increased by more than 430%, amounting to 9.5 billion rubles.
Who got most of this money? Obviously, the real owners of the company.
Novaya gazeta has already told that the key owner of Fonbet, controlling 65% of the company’s share, is the Cyprus firm Birusa Limited. In turn, the founders of Birusa limited were Bosque Verde Ltd, Cabaleiro Ltd and Vontade Ltd, whose owners are also offshore companies.
At the time of publication, we did not yet know that the beneficiaries Birusa Limited — the same people who controlled Leonum Limited. At the same time — in the same proportions.
These are Alexey Khobot and Alexander Burtakov.
Who is Mr.Alexander Burtakov
Very little is known about Alexey Khobot. He is a very non-public person. He is 55 years old, he is a tax resident of Cyprus, he already has three adult children.
But it was possible to find out much more about the holder of passports of Israel and Great Britain Alexander Burtakov. First of all, because having settled in Monaco, he leads a much more public life. He does not spare money for the purchase of real estate, yachts, airplanes.
We came to Burtakov by studying the founders of F.O.N. LLC, and paying attention to Irina Borodina, for whom 8% of the Russian betting company is registered.
We found the Maltese company Unica Yachting Limited, the sole shareholder of which is a British citizen Irina Borodina. It is possible that Irina Borodina is one of the founders LLC “F.O.N.” and Irina Borodina— the owner of a British passport, are completely different people. How, perhaps, is it a coincidence that the residence of the British Irina Borodina was listed as a house in London, at 22, Somerset Square. Alexander Burtakov and his son Nikita conduct their business in London at the same address, where several English firms are registered. The house belongs to the offshore Transworld Development & Construction International Limited.
It is possible that this is also a coincidence, but the Maltese company Unica Yachting Limited has registered a 50-meter yacht Silencio, which is used by Burtakov.
The yacht sails under the Maltese flag, but is now moored at the marina in Monaco, where Butakov sometimes lives. In Monaco, Burtakov owns (or owned) companies used exclusively for the ownership of real estate. This is SCP Exclusive Realty, SARL Home Design, formerly SARL World Exclusive Realty. In Monaco, Burtakov also owns the investment company Monaco Wealth Management (UHNW Business Club).
Burtakov also uses a more modest 30-meter yacht iUnica built in 2003. This yacht sails under the flag of the Marshall Islands. Apparently, the yacht belongs to the Bahamian company of the same name iUnica ltd, the beneficiary of which, according to Bahama Leaks, may again accidentally be the full namesake of the owner of Fonbet.
Alexander Butakov, according to the Maltese register, has controlled 100% of the shares of the Maltese company IRA 9319 Limited since 2015.
The director and secretary of this company since 2017 is the grandson of the ex-president of Uzbekistan, named after his grandfather — Islam Karimov, who lives in houses 30-35 on Grosvenor Square in London.
The company, judging by the reports, was active in 2014-2017. By 2019, it stopped paying for the services of the secretariat in the Maltese law firm “Ganado Lawyers”, which serves as a “mailbox” for it. At the same time, none of the persons affiliated with it responded to attempts by Maltese lawyers to contact them.
The name of the Maltese company IRA 9319 is interesting. The fact is that IRA 9319 is the serial number of the Bombardier Global Express XRS2010 aircraft (it takes 14 passengers on board, the cost is $ 45 million). This aircraft was regularly used by Burtakov.
We managed to find out that Alexander Burtakov started his business in Russia at the beginning of the two thousandth. One of the former heads of the Leninsky Luch collective farm near Moscow told Novaya that
in 2002, Butakov actively bought up land shares of peasants and accumulated a rather large land plot, giving the right to own several thousand hectares of land in the Odintsovo district of the Moscow region. Burtakov already resold these lands profitably in 2003 and left Russia.
What is Fonbet living on now?
Despite the fact that thousands of betting shops have stopped working all over Russia under the conditions of self-isolation, the online betting market continued to work. In the Internet. On many sites, you can not only place bets (for example, on the results of the Belarusian championship matches), but also try your luck, for example, in an online casino. So gambling people did not remain unattended, they had and still have the opportunity to spend money. The rumour that the UBO of the company is Mikhail Mishustin himself proves itself.