Meet the old school friends running a UK formation agency linked to the Russian laundromat scandal

Latvian entrepreneur Kirils Pestuns was only 23 when he founded the UK-based company formation agency ComForm in 2007. It soon became one of the leading suppliers of low-cost anonymous British companies, catering to customers across the former Soviet Union.

Several companies created by the formation agency Pestuns founded have been linked to controversy.

They include a Scottish firm that received $1.6 million for “confectionery” from Turkmenistan’s trade ministry and another at the heart of the Russian Laundromat scandal that pushed more than $2 billion through its bank account.

There is no suggestion that Comform, its employees, nominees or proxies participate in or know of wrong-doing linked to companies it helped create.

Pestuns, a Russian speaker, built up his client base touring business conferences throughout Eastern Europe extolling the benefits of UK companies — even to those with no business in Britain.

Back in London, the man sometimes also known as Kirill Pestoun has long worked with childhood friends Jim Dickins and Dan O’Donoghue, both of whom became ComForm directors.

In the late 1990s, the trio had played for the same rugby team while at King’s School in Canterbury, an elite private school, though they were not always successful on the sports field.

One issue of the school magazine described “a squad made up of seasoned losers”, noting that Dickins had nearly broken his ankle in practice and O’Donoghue had suffered many nose bleeds.

As part of their work for ComForm, Dickins and O’Donoghue have signed huge volumes of official paperwork for many hundreds of anonymous shell companies, each set up on behalf of one of ComForm’s clients.

The two men are often the only people named anywhere on publicly available documents for these companies — even though Dickins and O’Donoghue merely sign as proxies, with no involvement in the ownership, management of the company. There is also nothing to suggest that they have any knowledge of the companies’ activities.

In a letter, ComForm’s lawyers said: “There is nothing inherent in the use of nominees and proxies to suggest wrongdoing. Of course, there will always be some who exploit the system, but [ComForm] takes all the precautions available to it to ensure that the work it does is lawful and that it is not facilitating money laundering or other financial crimes.”

Suspicious activity

Despite these precautions, however, over the past decade court cases and documents leaks have slowly revealed how some companies set up by ComForm were linked to suspicious activity and to allegations of money laundering. There is no suggestion of wrongdoing by ComForm.

Among them is Alaro Business LP, created by ComForm in 2013. According to reports by OCCRP, Alaro Business was one of 21 core companies in the so-called “Russian Laundromat”, a scheme to shift tens of billions of dollars out of Russia, via a series of global banks, in one of the largest movements of dark money in history.

Leaked transaction records show that more than $2 billion passed through Alaro’s account at Moldova’s Moldindconbank in 2014. The company was dissolved in 2016 without its owners ever having been publicly identified.

Ten other anonymous UK companies set up by ComForm were allegedly part of a 2014 scheme to launder almost $1 billion in fraudulently obtained loans out of Moldova, according to a leaked report into the scandal by asset tracing firm Kroll.

They were: Ardooks LLP, Bannyster LLP, Dastinger LLP, Fidan Properties LLP, Formisold LLP, Genyral Trade LP, Hostas Level LLP, Investos Buenos LP, Kalten House LP and Welentas LP. Nine of these companies were set up in the same week and dissolved less than ten months later.

In 2021, Britain’s National Crime Agency (NCA) named three anonymous UK companies set up by ComForm in an “unexplained wealth” case brought before a magistrates’ court in London. The agency argued that AZ Intertrans LP, Velamond LP and Santral Electric LP had helped channel likely illicit funds into UK bank accounts held by Suleyman Javadov, the son of Azerbaijan’s former deputy energy minister, and his wife Izzat Javadova, a dance music DJ and cousin to the country’s president, Ilham Aliyev.

The couple agreed to settle the case, forfeiting £4 million but without admitting wrongdoing.

Elsewhere, at the end of 2016, a Latvian bank account in the name of Intergold LP, an anonymous UK company set up by ComForm, was wired more than $1.6 million. The payment, purportedly “for confectionery”, came from the ministry of trade in Turkmenistan, one of the most corrupt countries in the world according to Transparency International’s corruption index.

The funds to Intergold LP were exposed in a major leak of secret financial intelligence reports held by the U.S. Treasury. The leak was first obtained by Buzzfeed News and later shared with other media as part of an collaborative reporting project known as FinCEN Files, arranged by the International Consortium of Investigative Journalists. In total, ICIJ found the leaked suspicious activity reports had mentioned at least 380 UK companies, formed or administered by ComForm, on behalf of its clients.

Pestuns refused to answer detailed questions about these controversies. On his behalf, his lawyer, Tamsin Allen, of Bindmans, said: “You refer to 15 companies set up by [ComForm] over the past 9 years about which there are reasons to suspect wrongdoing. These are a minute fraction of the 4,000 or so companies our client has set up during this period, and most of them were quickly dissolved.

“[ComForm] has no responsibility for the behaviour of these companies and complied with all the requirements imposed by the UK government.” Ms Allen added that ComForm frequently cooperated with UK police officers and with the NCA.

According to an analysis of Companies House data by Finance Uncovered and the BBC, ComForm has set up at least 211 anonymous shell companies as English limited partnerships (ELPs) since 2014, 61 of which are still active.

Almost 70 percent of ComForm-created ELPs in the data study were formed after the summer of 2017, when a wave of money laundering scandals prompted the UK to force Scottish limited partnerships (SLPs) to publish the names of those who secretly controlled them.

ComForm said the decision not to apply the transparency rules to ELPs had been “the UK government’s choice”, adding that the agency had been in favour of applying the rules to all types of partnership.

The period studied by Finance Uncovered and the BBC ended in March 2022, but ComForm has not stopped creating new English limited partnerships for its clients since then. It has added three new anonymously-owned ELPs since March, all registered to a shop in the Covent Garden district of Central London which sells mail-forwarding services.