Ilyumzhinov decries FIDE treasurer account as "fake news"

by Macauley Peterson
2/22/2018 – The FIDE president, locked in a power struggle with former allies, pushed back on the recent letter from FIDE's treasurer Adrian Siegel in a public statement Wednesday, calling it "fake news". In this editorial, we take a brief look at Ilyumzhinov's response and what it portends. | Image: Ilyumzhinov's official Twitter account

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Lawyer's statement alleges "smear campaign"

In a statement published on February 21st on the "Kirsan Ilymzhinov Information Portal", the embattled FIDE president criticises the media for, what he feels was, uncritical reporting on the letter from FIDE treasurer Adrian Siegel dated February 12. In its opening paragraphs, the statement reads:

The letter of the federation’s treasurer Adrian Siegel published on FIDE website, states that the Swiss UBS bank is ready to close FIDE account in the near future. Even third-party observers immediately noted a number of inconsistencies. First, the sanctions against Ilyumzhinov were introduced by the US Treasury in late November 2015, but for some reason this did not prevent the bankers from serving the federation for more than two years.
Nevertheless, some media seized on Siegel's message. Since the bank did not comment, journalists of some media simply broadcast the message of a misleading letter published on the FIDE website."

In a tweet the same day he referred to the press coverage as "fake news", a term which has become so muddied as to have unfortunately lost much of its meaning. The letter from Siegel was reported by numerous online press organizations, among them, The Telegraph, Bloomberg, The Times, and many more. Most clearly made at least some effort to verify the basic underlying issue:

Is UBS closing the FIDE account or not? And if so, why?

For instance, the Bloomberg story cites a statement from the bank:

"We can’t comment on whether individuals or organizations are clients of UBS. We follow all laws and regulations that are applicable to us," the Zurich-based bank said in a statement. A person answering the phone at FIDE’s office in Lausanne, Switzerland, declined to comment on the matter.

It's a reality of modern day press rooms — even at relatively large news organizations — that reporters have very little time to report out a story like this — perhaps 30 minutes or less. This is one reason why mainstream media coverage of chess is often terrible.

In this case, Dr. Siegel's statement was fairly unequivocal, and he is in a position to know. As we reported the day after the letter was published, he stated that "the Swiss bank UBS has announced that they will immediately close our accounts."

However, two days later, he told that, "At the moment we are completely functional. However, we know that UBS most likely will close the account at the latest by April." So, it seems, by "immediately" he meant "very soon".

Is that misleading? A little. According to Ilyumzhinov, it's one of "a number of false part of an ongoing smear campaign in advance of the FIDE elections later this year."

This is a bit overly dramatic. The practical implication is that FIDE needs to find a new bank and this may be difficult, whether it's next week or next month. In any case, we'll soon find out — well in advance of the election which will take place in Batumi, Georgia, along side the 43rd Chess Olympiad. If FIDE's UBS account remains open and operational through April, then the FIDE treasurer will look like the proverbial Chicken Little and will have some explaining to do.

Ilyumzhinov makes one additional point:

Public documents released in 2015 by the U.S. Department of Treasury do not allege that Mr Ilyumzhinov has been sanctioned by the US as a result of him conducting oil deals involving ISIS.

That's technically true, which is why we linked to the original documents and reported that he was under sanction "due to his links with the Russian Financial Alliance Bank". The statement from his "London lawyers" (as the post calls them), uses the carefully-worded phrase, "as a result of him conducting oil deals involving ISIS".

That is indeed not alleged by the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC), whose press release dated November 25, 2015, spells out the connection a bit more:

Kirsan Ilyumzhinov was designated today for materially assisting and acting for or on behalf of the Government of Syria, Central Bank of Syria, Adib Mayaleh, and Batoul Rida...Ilyumzhinov is a major shareholder of RFA Bank and former Chairman of the Board of Directors of RFA Bank.  At the time of his Chairmanship, Ilyumzhinov reportedly brought in his own representatives to the bank.

Rather than alleging a direct link between Ilyumzhinov and any "oil deals", Siegal's statement in the February 12th letter implicitly relies on further reporting, for instance from the Financial Times, that makes the link between aiding the Syrian government and aiding ISIS, without directly connecting Ilyumzhinov to the two. Of course, it is worth keeping in mind these are, at this point, unproven allegations.

2015 headline from the FT

Headlines like this from the FT have dogged Kirsan Ilyumzhinov for years

When it comes to Swiss banking officials, however, this may be a distinction without a difference, and all that matters is that Ilymzhinov has had over two years to clear his name, and hasn't. Indeed there has been scant evidence that he has actually taken any steps to do so.

At the end of the FT reporting, for instance, Ilyumzhinov is paraphrased as follows:

He said he would be in the US next week for talks for his next chess world championship match, and had no plans to cancel his trip.

He not only cancelled his trip, he hasn't set foot in the USA (so far as we know) since. His own statements on the matter have been misleading, vague, or just plain wrong.

Ilymzhinov is certainly entitled to due process when it comes to the OFAC sanctions. But the fact that those sanctions have presented, and continue to present, a risk to FIDE — while Ilyumzhinov remains, nominally, the head of the organisation — is clear. In a sense the news of FIDE's banking woes — whether "immediate" or "imminent" — should come as no surprise.

FIDE, as an international organization of national federations, need not be responsible for the personal financial, legal, and political problems of any one of its officers. Assuming FIDE's UBS account will in fact close, the treasurer could dispell any notion that the stated reasons for the UBS action are "fake" by publically disclosing the communications that directly link the sanctions to the account closure. That would certainly inform the General Assembly's deliberations in the coming months. Beyond that, Ilyumzhinov is free to continue his "fight for justice", exercising his "skills as a senior statesman".

We closed our previous report with a question, about whether the public excoriation would persuade Ilyumzhinov to abandon his re-election bid, or strengthen his resolve?

Now, it looks a lot more like the latter.


Macauley is Editor in Chief of ChessBase News in Hamburg, Germany, and producer of The Full English Breakfast chess podcast. He was an Associate Producer of the 2016 feature documentary, Magnus.
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fons3 fons3 2/25/2018 11:17
@ rokko - This article was free so it must be fake news then?
rokko rokko 2/25/2018 05:12
I do not see any fake news in the FT article : they report the FACT that the US government has made accusations and has put K.I. on the sanctions list.

And unfortunately, quality information is not always free of charge ("paywall"). Fake news always are...
fons3 fons3 2/23/2018 09:53
>>> "a term which has become so muddied as to have unfortunately lost much of its meaning."

Uhm... no.

"Fake news is a type of yellow journalism or propaganda that consists of deliberate misinformation or hoaxes spread via traditional print and broadcast news media or online social media."
(source Wikipedia)

Not sure what all the confusion is about.

Or let me guess: it was the mainstream media that launched the term in an effort to discredit any information that did not suit their agenda. But the mainstream media is caught lying so often that the term has now boomeranged into their own face. Funny how they now call for people to stop using the term. Talk about something blowing up in your own face.

>>> "for instance from the Financial Times, that makes the link between aiding the Syrian government and aiding ISIS, without directly connecting Ilyumzhinov to the two. Of course, it is worth keeping in mind these are, at this point, unproven allegations."

So in other words: fake news. Or very likely until proven. The Financial Times can make up whatever they like. (That FT link is behind a paywall btw.)

This is what people mean when they say the mainstream media is used as a propaganda outlet. Of course most people reading this won't believe this. Not sure what they are expecting instead. Statements from the ministry of propaganda? Or maybe they believe propaganda does not exist?

>>> "all that matters is that Ilymzhinov has had over two years to clear his name,"

The burden of proof is on the accusers, not the accused.
Are we back in the Middle Ages? Throw him in the water, if he doesn't drown he's guilty!

Also you can't prove a negative, so you can't really prove that you did not do something.

PS: I am not a fan of the current FIDE administration and certainly not of Ilyumzhinov, I've always criticized him in the comments. He needs to be removed, but so does the rest of the current administration, a "subtlety" that is overlooked by most it seems.

I also believe in objectivity and the truth. This article has been written in the style of a hit piece.
rokko rokko 2/23/2018 07:25
I am not trying to defend Ilyumzhinov but the US approach of accusing people without published evidence and putting them on sanctions liste without any legal process is a bully approach that falls short of normal democratic processes.

The burden of proof should be on the US government and not on the accused.

And banks all around the world have to act as US government policemen or will otherwise be condemned to pay billions of dollars of fines or use their US licences.

It is sad that FIDE and chess gets entangled in these affairs and there are certainly better presidents that K.I. but a US sanctions list is only an accusation, not a legal decision.
Aighearach Aighearach 2/23/2018 09:08
If he looked as good as Putin half naked on a pony, then he could get away with it.

But he doesn't. So he should resign.
calvinamari calvinamari 2/23/2018 01:57
"Ilymzhinov is certainly entitled to due process when it comes to the OFAC sanctions."

Yes, but it has been two years and, for all we know, he has not put forward one shred of exculpatory evidence. Even assuming he has made his case to the US government, it is clear that that case is viewed as utterly unpersuasive since it has resulted in no change in his status. I am sure in the upcoming FIDE election we will hear yet again that Ilyumzhinov is just days away from having his name removed from the sanctions list. Sure. And Godot's bus is just running late. But most federations will fall for it, which suggests one of two things -- either that chess players are gullible morons, or that keeping FIDE as a front organization is so financially valuable to Ilyumzhinov that considers it a good investment to buy his way to victory again.

"FIDE, as an international organization of national federations, need not be responsible for the personal financial, legal, and political problems of any one of its officers."

Hypothetically, sure. But what's the reality? First, though clear rifts now seem to emerged between Ilyumzhinov and others in leadership, those others for years served as Kirsan's lackeys. Does anyone really believe that the auspices of of official FIDE were never utilized, with the senior leadership's full knowledge, as a mere front to advance Ilyumzhinov's nefarious personal agenda ? Whenever a periah state emerged, there was Kirsan, the billionaire with only shadowy sources of income, meeting with the leader and claiming he was only there to promote chess - as if such autocrats would devote a nanosecond of their time to that subject. Often it seemed like Ilyumzhinov actually went out of his way to flaunt FIDE as mere facade. Face facts: a septic tank has been emptied into the groundwater of your "international organization of national federations." To think that under this circumstance FIDE deserves a pass is naive.
sligunner sligunner 2/23/2018 12:57
This man is a crackpot lunatic and shouldn't be running a lemonade stall, never mind an international organization. For god's sake FIDE, ditch this crooked weirdo.
Frits Fritschy Frits Fritschy 2/22/2018 10:41
As I wrote earlier, it is quite likely Siegel's statement was politically motivated (and I couldn't care much if it was). Of course the UBS won't talk about its customers with the press.
But it would be interesting to hear what the rest of the FIDE presidium (apart from Ilyumzhinov), notably Makropoulos, has to say about this story and what they consider should be the consequences of it. I would say that's a journalistic approach.
TheTrueFalcon TheTrueFalcon 2/22/2018 10:26
Dear Aliens,

Please take Kirsan again and you may keep him this time.

e-mars e-mars 2/22/2018 08:56
Problem is what the civil, democratic world takes for granted - that he is a criminal - it is not necessarily true for all those small, underdeveloped, succubus countries that support him and, above all, vote for him. They don't even know what is going on because of propaganda and lies. Even Big Mother Russia does not know anything about what's going on, you might not be aware of the level of propaganda and obfuscation that Russia is experiencing right now, I've seen it...
basler88 basler88 2/22/2018 07:59
Oh, shut up Kirsan, you’re a criminal and not worthy to be on the FIDE Board! Get out and I’m sure Putin has a new job for you, just don’t travel too far as the justice system is waiting for you.