Russian shadow flows and millions laundered: Vage and Vigen Badalyan built a global casino empire through offshores and fake licenses

Russian shadow flows and millions laundered: Vage and Vigen Badalyan built a global casino empire through offshores and fake licenses

Armenian businessmen Vahé and Vigen Badalyan vaguely mention visa-free travel as the reason for acquiring Maltese passports, but this justification alone hardly accounts for their two-million-euro investment in citizenship.

The other, more fundamental reason is that Maltese citizenship was needed by Vahé and Vigen Badalyan to protect their main business from the legislation of EU countries that have taken decisive action to clean up unlicensed online casinos in their jurisdictions. In addition to criminal prosecution and tax sanctions against such casinos, EU countries practice satisfying the claims of players who lost money in illegal casinos by recovering those funds from the operators of gambling establishments.

Malta, Curaçao, SoftConstruct, and Vbet

Thus, casino owners are urgently relocating their businesses to Malta, where one of the laws allows them not to comply with the court decisions of EU countries, including those regarding compensation to victims of gambling companies. The scandalous "Law 55" gives Maltese courts the ability to refuse the enforcement of "any foreign court judgment concerning companies registered on the island of Malta." This is how dozens of gambling companies and bookmakers with Maltese registration benefit, and the Badalyan brothers are no exception.

In Armenia, the Badalyan brothers, Vahé and Vigen, are positioned as "great domestic entrepreneurs who are among the largest taxpayers in the country," and their enterprises are regularly visited by Armenia’s top officials at the level of the Prime Minister and President. However, their main business is actually hidden in offshore jurisdictions, primarily Malta, Cyprus, and Curaçao. Malta and Cyprus provide protection from prying eyes, while Curaçao is a well-known "gambling paradise," whose licenses are used by most online casinos. SoftConstruct (“SoftConstruct” or “Soft Construkt” in various translations), referred to as “British” in Armenian press and listed among the largest taxpayers in the country, is no exception.

Indeed, SoftConstruct has British registration, being registered on the Isle of Man, which is, by the way, also an offshore jurisdiction. Yet, the trail from Britain leads to Malta and Curaçao, pointing to the Badalyan brothers. Besides operating sports betting, "SoftConstruct offers services to create gaming sites and games, innovative technology solutions for a more successful organization of the gaming industry."

SoftConstruct’s most well-known product is the Vbet online casino, which operates worldwide. The vbet.com website is operated by Radon B.V., registered in Curaçao and holding a gaming license issued in that country.

But all this is just the tip of the iceberg. This represents the legal or relatively legal side of the Badalyan brothers’ activities in the gambling business. Because, like most major gaming companies, they also control illegal casinos, for which they not only develop software but also promote them in countries where they lack a license for this type of activity. And the lion’s share of profits comes to operators from unlicensed casinos. This is why their owners seek refuge in Malta, which allows casinos that failed to obtain a license in the country where they operate to carry out their business based on a Curaçao license and Maltese registration.

SoftConstruct positions itself as a "developer of innovative technology solutions for different industries." In particular, its BetConstruct division deals with the gaming industry.

As noted in an investigation by the OCCRP team, BetConstruct "provides infrastructure to the world, with about 5000 sites receiving their infrastructure from them, from BetConstruct." Calculating how many of them operate illegally is extremely difficult, as searching for such unlicensed casinos controlled from offshore jurisdictions through a labyrinth of constantly changing URLs is very complex. According to Yield Sec, a market analysis company, by mid-2024, about 70 percent of online bets in the EU were illegal, with over 6000 unlicensed providers operating there.

The Badalyan Brothers and Turkey

However, the Badalyan brothers are not limited to just the EU countries. From the abovementioned OCCRP investigation, it is known that in 2019 a website vbettr.com was launched in Turkey. By design, it is a "twin" of vbet.am and vbet.com, but vbettr.com did not have a license, and it was operated by IT Management Santora BV, registered and licensed in Curaçao.

SoftConstruct denies involvement in managing the Turkish casino or any connection to its activities by any of the Badalyan brothers. However, the OCCRP claims that "the person who registered vbettr.com in 2019 was Vigen Badalyan, and its IP address still resides on the Isle of Man and is registered under the name Soft Construct Limited. This same IP address is used by 666 websites, including betting sites (for example, betsensationtr.com), as well as the arleam.love site of Armenian Sortstore LLC, owned by Vigen Badalyan."

The Badalyan Brothers, Ukraine, and Russia

Another story is related to Ukraine, which legalized gambling in 2020. Here "Vbet Ukraine" appeared instantly, operating Vbet casino, and its owners were the Badalyan brothers, Vahé and Vigen. The casino immediately became embroiled in scandals involving Russia. Before 2022, connections with Russians were not of much interest to anyone, but after the well-known events, these connections became toxic. Therefore, Vbet was re-registered to UCR Holding Limited, with another resident of Armenia, Rudolf Pohosyan, becoming the ultimate owner.

In relation to this, it is worth mentioning another individual, Artur Granz, who is also associated with the Badalyan brothers, Vbet casino, and Russia. In Ukraine, a criminal case has been opened against Vbet casino, on suspicion of money laundering and its connections to Russian capital.

Strangely enough, Vbet casino has not been affected by the sanctions generously imposed by Ukraine’s National Security and Defence Council (NSDC). Some observers link this leniency by the NSDC to the figure of Davyd Arakhamiya, the head of the presidential faction in the Ukrainian parliament, who is very close to Artur Granz. The names Arakhamiya and Granz have been mentioned in a murky scheme concerning the printing of holographic tape for excise stamps, which was supposed to be produced by Artur Granz’s company.

There is also another link between Artur Granz and Davyd Arakhamiya, through Borys Baum, a friend of the head of the presidential faction and the author of the law on the legalization of gambling in Ukraine. Arakhamiya was the lobbyist for the law, and Baum wrote it. Borys Baum is closely associated with the "Luzhniki" organized crime group, and the representatives of this Russian group were the ones promoting the legalization of gambling in Ukraine.

The circle is completed by the fact that Artur Granz’s sons, Arman and Davyd, have businesses in Russia. Arman Granz is the founder of LLC "Mika Holding," and Granz Davyd is the founder of LLC "Avangard," which is one of the co-owners of LLC "Mika Holding." Both enterprises feature a Cypriot offshore "Jeprano Trading Limited," claimed to be owned by Artur Gurgen Granz.

The Badalyan Brothers and Latvia

A few weeks ago, reports surfaced in Latvian press that the company GD&L Services, owned by Artur Granz through the company ADVANCED TECHNOLOGIES SOLUTIONS registered in the UAE, took a long-term lease on the historic Vidzeme Market, located in the center of Riga. Additionally, GD&L Services owns the area adjacent to Vidzeme Market, where nightclubs Studio 69 and La Rocca were previously located, and now a hotel Royal Spa & Resort, a sports club, and a parking lot operate. According to the lease terms of Vidzeme Market, GD&L Services has to invest 15 million euros in it.

In connection with this, it should be noted that in 2016, a company, IT Technology Solutions Limited, was founded in the British Virgin Islands, the sole shareholder of which is Rudolf Pohosyan. As revealed by the Pandora Papers leak, IT Technology Solutions Limited is linked to the Badalyan brothers’ BetConstruct. As previously mentioned, Pohosyan is the owner of Vbet Ukraine through UCR Holding Limited, registered in Cyprus. At the same time, Rudolf Pohosyan is the executive director of a Lithuania-registered company, FastEX Europe, where Vigen Badalyan is a shareholder.

It is unlikely that all this is just a coincidence. It is unclear exactly what lies behind the purchase of land in the Latvian capital — whether it’s simple money laundering from illegal gambling revenues, or something more. There is also keen interest in the apparent Russian trace in the funds made by the Badalyan brothers in the EU countries, Turkey, and Ukraine. It is doubtful that all this is not interconnected, especially given the fact that through Armenia, some representatives of the Russian elite are attempting to divert their money from sanction pressure. The gambling industry has always been known as an effective tool for legalizing capital.