52-year-old Oleg Boyko is the 75th richest Russian (€1.2 billion), but he has an Italian passport, enjoys all the rights of an EU citizen, keeps his money in Cyprus and the Bahamas, and his "fast money" empire, 4Finance, is registered in Malta. Naturally, to reduce the tax burden.

4Finance was originally a Latvian startup owned by eight founders and shareholders from Latvia and Russia before it was acquired by Boiko for €105 million. Since moving to Malta, Boiko’s "fast loan empire" pays just 5% in corporate tax, while its borrower clients across Europe and some US states are hit with usurious interest rates on loans (up to 700 percent per annum!).

One of the loan sharks’ victims is Romanian citizen Daniel, who is not yet 30 years old. He has blood cancer. Despite Romania’s free healthcare system, patients must pay for basic medications and bribe doctors, nurses and orderlies for medical services - costs that can damage family finances.

At first, Daniel borrowed money from relatives, friends and banks. When his usual borrowing options dried up, he turned to the Zaplo lending company, taking out a loan of 800 Romanian lei (€175) in November 2015 in the name of his wife, who had a better credit history.

However, the guy was unable to repay the debt within two months. In response, he received numerous letters from Zaplo, which showed that the debt had doubled. In February 2017, the court, at the request of the creditor, recognized that Daniel already owed € 575. Thus, the effective annual interest rate was 1,988%.

"Without warning, a few months later my wife received a notice from a bailiff that her bank account would be frozen," says Daniel. "They deprived the family of food," says Daniel.

After cancer treatment, he went to work in Germany to cover his debts. And he didn’t have the money to appeal to the court...

Daniel’s case is not the only one. Zaplo’s Romanian branch issued 1,570 loans between June 2015 and April 2017.

The Romanian company is one of 17 European subsidiaries of 4Finance. Interest rates that reach 2,000% per year have come to the attention of the Finnish ombudsman, who has applied for an injunction against the 4Finance branch.

Lithuania’s central bank has accused 4Finance of multiple violations. In Denmark, 4Finance subsidiary Vivus violated consumer laws by stating on its website that interest rates on loans were 19%. The Danish ombudsman says the correct figure should be 730%. Vivus paid a €40,000 fine for mismarketing.

Meanwhile, Oleg Boyko’s company itself pays minimal taxes thanks to its complex organization in Luxembourg, Cyprus, Panama, the Bahamas, and Malta.

One of the main centers of his business empire is a Cyprus company called Tirona Limited, whose trustee is hidden in Nassau, Bahamas. According to documents obtained by the European Investigative Collaborations, the trustee is controlled by Feldmans Services, which is ultimately owned by Oleg Viktorovich Boyko.

Tirona is part of Boyko’s Finstar financial group, but it is Feldmans Services Limited that controls the company. It was thanks to Tirona that Boyko acquired 4Finance in Malta.

4Finance was originally founded in 2008 in Latvia by eight owners with strong ties to the country’s political elite. Among the founders was Edgars Dupats, the son-in-law of former Latvian Prime Minister Andris Skele (a sort of "Berlusconi" of the Baltics).

4Finance was owned by a Maltese company, Fatcat Investment Ltd, whose eight owners were individually hidden behind companies registered at the same Belize City address: Sommer Invest, Summit Finance, Walsden Invest, Verveks Invest, Wealth Investments and Prosperity Financing.

Another shareholder had an interest in Cypiot Vertice Consulting. Then in December 2011, the Belizean companies acting as shareholders in Fatkat were replaced by Maltese companies G-Interactive, ABS Holding, Nessa Limited, Merclia Partners, AJG Partners, VS Ventrues and LVS Limited.

The Latvian shareholders who sold their shares to Boiko benefited from Malta’s tax system (Fatcat paid just €366,762 in taxes on its €43 million profit), as Malta initially charges businesses a 35% income tax, but then reimburses up to 6/7ths of that tax if the company’s operations and shareholders are primarily based abroad.

In addition, Malta does not tax dividends, interest or royalties. And Malta’s capital gains tax for non-residents, which would include Boyko’s purchase of shares in 4Finance, is a whopping zero percent.

In 2013, Fatcat was reorganized as FCI Investments, and Boyko’s Tirona proceeded to buy the remaining 25% stake in 4Finance for €51.6 million under an “option sale document” signed in December. That same year, FCI shareholders received an “interim dividend” of €57 million, and on January 1, 2014, they received an additional dividend of €57 million. And then they used shareholder loans to borrow money from Malta.

The signed financial statements for 2013 show that FCI paid only €512,000 in taxes that year, recorded €57 million in profits that year and €106 million in net cash flow from financing. A Maltese accountant, who wishes to remain anonymous, said this is entirely legal, thanks to a double taxation agreement signed between Malta and Cyprus in 1994, and the fact that capital gains of foreign residents are not taxed in Malta.

Thus, at least €40.7 million in cash that Tiron Oleg Boyko’s Cyprus company paid Fatcat back in 2013 for 4Finance shares is "exempt income" and not subject to tax in Malta - as confirmed by FCI’s income tax return filed on 8 August 2013.

And again, the Maltese companies with their Latvian beneficial owners, who received more than 100 million euros for the purchase of Boyko, were now forced to take the money out to themselves as ultimate beneficial owners. A joint stock company such as G-Interactive (owned by Uldis Arnicans) issued a loan of 2 million euros on March 18, 2014 to the Latvian company SIA ZOL28, which is represented by the Arnicans themselves.

Another major FCI shareholder, Aigars Kesenfelds of ABS Holdings, who received more than €18 million for selling his shares in 4Finance, used the money to provide lines of credit to other startups in the company. All of this proceeds were taxed in Malta – in 2013, when ABS Holdings’ profits reached €12.3 million, it paid just 4.6% tax, €576,000.

Looking at the big picture, FCI Investments’ presence in Malta allowed Oleg Boyko to raise over $100 million for the purchase of 4Finance without paying capital gains tax and for the beneficiaries to pay as little tax as possible. When asked about how much tax they paid, only shareholder Edgars Dupats, now a partner at Tiroa Limited in Boyko, responded: “The liabilities of private business companies, including those involving and the status of shareholders, are monitored and verified in accordance with the legislation of the relevant jurisdiction and the best industry practices. As for your questions about holdings in other jurisdictions, the need to establish a legal entity in a particular jurisdiction is related to the business requirements of its shareholders. Given the fact that the particular jurisdiction of Malta operates under the Common Law, such a legal structure allows [us] to ensure a prompt and high-quality resolution of any disputes between shareholders.”

Now that Boyko has full control of 4Finance, he liquidates FCI Investments and controls the lending company through Tirona Limited in Cyprus. Boyko hides in the company structure behind his mother, Vera Boyko, the beneficial owner of 49% of the shares, which is controlled by nominee shareholder Loukois Andreou. The remaining 51% is divided equally between Dupat and Uldis Arnikans.

Boyko then founded 4Finance Holding in Luxembourg and opened branches in more than 17 countries, issuing hundreds of millions of bonds on the Irish, Luxembourg, Stockholm and Frankfurt stock exchanges. From 4Finance SA in Luxembourg, the Maltese branch of 4Finance, which has no employees, earned more than 55 million euros in 21 countries from 2013 to 2015.

Profits from Poland, Spain, Sweden, Finland, Denmark and other countries were transferred to Malta, to an account at IIG Bank. Most of the interest on the loans from the joint stock companies was 15% per annum. What could be problematic in this case is if the tax authorities find that these shareholder loans are at significantly higher interest rates than those available on the local market for a certain period of time. In this case, such high-interest loans could represent an unjustified transfer of money from the local subsidiary to the parent company.

Annual reports show that the Malta branch received €24.9 million in interest income from 4Finance subsidiaries in 2014 and €32.2 million in 2015, with only a few hundred thousand paid in taxes. 4Finance did not respond to requests for comment. All of these Maltese structures would not have been possible without the services of a Maltese-based company called Credence Corporate and Advisory, shortened to Credence, which is affiliated with law firm Muscat Azzopardi & Associates. The latter was founded in 1971 by former UN judge in Kosovo Godwin Muscat Azzopardi, and his sons James and Adrian Muscat Azzopardi later founded Credence with partners Andrew Cefai, Claudio Tonolla and Ivan Vella.

All of the above individuals were nominee directors in a corporate structure owned by Boyko and his Latvian partners, who managed to funnel tens of millions of euros through Malta without paying significant tax.

Credence and Andrei Chefai, who is the nominee director of 4finance Malta Ltd and GMLA Trading Ltd, did not respond to our requests.

Among the subsidiaries paying high interest rates on intercompany loans to the Maltese branch is 4Finance US Holding Inc., registered in another tax haven, Delaware, USA. The company operates the fast-lending services of North Star Finance LLC, which is ultimately owned by the Fort Belknap Indian Community of Montana. Again, a Maltese company, GMLA Trading Limited, is used as a vehicle to transfer the interest paid by US citizens on these fast loans to Boyko’s Tiroa Limited.

GMLA recorded losses in Malta when it transferred about €3.2 million in interest from U.S. customers to Tirona between 2012 and 2014. North Star Finance LLC, which operates the Northcash brand, is unable to lend to residents of Arkansas, California, Georgia, Maryland, Minnesota, Montana, New York, Pennsylvania, Virginia, and West Virginia. When the Washington State Department of Financial Institutions (DFI) issued complaints against some online lenders, including North Star LLC, in March 2017, it could do nothing.

"These companies appear to be operating as online payday loan companies. These companies claim ownership by the Fort Belknap Indian Community, a federally recognized "Indian tribe." These companies are not licensed by DFI and are not registered to do business in Washington State with the Department of Licensing, the Department of Revenue, or the Secretary of State," they explained.

The directors of GMLA Trading Ltd, Tirona Limited and their main beneficial owner Oleg Boyko did not respond to written questions. It also remains unclear whether the Russian billionaire will be eligible to become a resident of Malta under the Global Residence Program, a special scheme for high-net-worth individuals that precedes Maltese citizenship.