The U.S. government is facing significant expenses in maintaining a mega-yacht seized from a Russian oligarch, amounting to nearly $1 million monthly, as per recent court filings.
The U.S. Department of Justice is seeking approval to sell the 348-foot yacht named Amadea, confiscated in 2022, alleging it belonged to sanctioned Russian billionaire Suleiman Kerimov. Citing the “excessive costs” of upkeep and crew, estimated at $922,000 monthly, the government aims to offload the $230 million vessel.
According to U.S. prosecutors’ filing on Friday, “It is excessive for taxpayers to pay nearly a million dollars per month to maintain the Amadea when these expenses could be reduced to zero through [a] sale.”
Monthly expenses for Amadea, currently docked in San Diego, California, include $600,000 for operational costs: $360,000 for crew, $75,000 for fuel, and $165,000 for maintenance, waste disposal, food, and sundries. Additionally, there are $144,000 in monthly pro-rata insurance expenses and special fees such as dry-docking fees amounting to $178,000, totaling $922,000, according to the filings.
The legal tussle over Amadea and its financial burden on the government underscores the complexities of seizing and selling assets owned by Russian oligarchs following the Ukraine conflict. European Commission President Ursula von der Leyen recently proposed utilizing over $200 billion of frozen Russian assets to support Ukraine’s war efforts.
However, nearly two years later, the legal process for verifying ownership and selling these assets has proved time-consuming and expensive. Russian billionaire Eugene Shvidler is battling in court over his impounded private jets in London, while Sergei Naumenko is contesting the detention of his superyacht Phi.
The Amadea saga commenced in April 2022, when Fiji seized it at the U.S. government’s request. Although the U.S. claims Kerimov owns the yacht, attorneys representing Eduard Khudainatov, a former Rosneft CEO not under sanctions, assert his ownership and seek to regain possession.
Khudainatov’s legal team opposes the rushed sale of the yacht, arguing it could lead to a distressed sale price. They contend that the maintenance costs pale in comparison to the potential sale value. However, they refuse to cover ongoing maintenance expenses as long as the government pursues a sale and forfeiture. They pledge reimbursement of over $20 million already spent on maintenance if the yacht is returned.
The government alleges Kerimov concealed his ownership of Amadea through shell companies and other owners, citing crew emails indicating his beneficial ownership. The emails reveal Kerimov’s involvement in interior upgrades, including a pizza oven and spa, and his family’s exclusive use of the yacht between 2021 and its seizure in 2022. It is said that the emails between crew members show Kerimov “was the beneficial owner of the yacht, irrespective of the titleholder of the vessel.”
The government claims Kerimov has attempted to sell Amadea for years, indicating his willingness to sell. They argue that selling the yacht aligns with his intentions, emphasizing it’s not akin to disposing of a cherished heirloom.
Even if Amadea is swiftly sold, the proceeds won’t automatically revert to the government. Per law, the funds will be held while Khudainatov and the government continue their legal dispute over ownership and forfeiture.
