Bernard Arnault, the LVMH luxury magnate who is second on the list of world’s richest people, is under investigation by authorities in his native France over suspicions that he laundered money by buying real estate through a Russian oligarch.
The Paris public prosecutor’s office confirmed to Reuters a report in the French-language daily Le Monde which stated that a preliminary investigation had been launched last year into transactions involving Arnault and Nikolai Sarkisov.
In the French legal system, a preliminary investigation does not necessarily imply wrongdoing.
Le Monde, citing the French finance ministry’s financial intelligence unit Tracfin, reported on Thursday that Sarkisov had acquired real estate at a luxury Alpine resort via a complex transaction in which Arnault, through one of his companies, had provided a loan.
According to the report, Sarkisov purchased several properties in 2018 in Courchevel, the exclusive ski resort where hotel stays can cost visitors thousands of dollars per night.
Arnault is alleged to have loaned Sarkisov $21.2 million so that the oligarch, who helps his brother Sergei run Russian insurance giant RESO-Garantiya, could purchase the properties under his name.
An unidentified Tracfin official told Le Monde the transactions involving Arnault and Sarkisov, who both acted through a complex web of legal entities, could have been aimed at concealing the origins of the funds used.
Le Monde cited a person close to Arnault as saying that the arrangement with Sarkisov was legal under French law.
The Post has sought comment from LVMH and Sarkisov.
Arnault and his family are said to be worth $164 billion on the strength of their stake in the luxury empire whose portfolio includes world-famous brand names such as Louis Vuitton, Dior, Givenchy, Bulgari, Dom Pérignon, Sephora, and Fendi.
As of Friday, LVMH boasted a market capitalization of $393 billion.
The 74-year-old Arnault has delayed retirement while at the same time grooming his five children to run different aspects of the family business.
Arnault is father to Christian Dior head Delphine Arnault, 48, and Dior Vice Chairman Antoine Arnault, 46, who are Bernard’s two oldest from his first marriage; Alexandre Arnault, 31, executive vice president of Tiffany & Co.; Frédéric Arnault, 28, who manages the TAG Heuer watch brand; and Jean Arnault, 25, the head marketing and development officer at the company’s watches division.
Business observers are eager to see which one of the children Bernard Arnault picks to run his empire once he retires.
This story originally appeared on NYPost
