Putin cash for US web giants

Millions for Facebook and Twitter spark new poll fears

TWO firms run by the Russian state made massive investments in Facebook and Twitter – through a business contact of Donald Trump’s son-in-law Jared Kushner, according to the ‘Paradise Papers’.

The revelation shows that Russia made millions out of the American internet giants, and will fuel mounting concerns about how Vladimir Putin has made use of the social media firms – potentially to influence US elections.

The documents show that Russia’s state-run VTB Bank and the state-run gas and oil corporation Gazprom ploughed money into the key social media companies around six years ago

VTB put £120million into Twitter shares, and Gazprom went through a series of investment bodies to help amass Facebook shares worth an astonishing £625million.

Both Russian state companies are subject to US sanctions, so rather than openly buying the shares in their own company names, they were purchased indirectly with the help of investment funds managed by ex-pat Russian technology tycoon Yuri Milner.

Potentially embarrassingly for President Trump, who continues to deny growing claims of Russian entanglement in his successful election campaign, Mr Milner holds a share in a firm part-owned by Mr Kushner, who is both Trump’s son-in-law and a senior White House adviser.

He was personally invited to invest in Facebook by the social networking site’s founder Mark Zuckerberg.

Mr Milner has lived permanently in America since 2014 – but the investment fund he operates, DST Global, has used money from investors including the VTB Bank in Moscow. The leaked documents show VTB put £120million into offshore fund DST Investments 3 – registered in the Isle of Man – which was used to buy 11million Twitter shares in 2011, which amounted to as much as 2 per cent of the company.

Meanwhile Gazprom, the Russian gas and oil giant, controlled an investment fund called Kanton Services based in the British Virgin Islands. Kanton owned the majority of a fund called DST USA II – again believed to be directed by Mr Milner.

And DST USA II bought more than 50 million Facebook shares, a holding of more than 3 per cent. They rose to a value of £625million – a billion dollars – before ultimately being sold at a profit. Ac- cording to the Guardian newspaper, Mr Milner said he knew the names of investors but could not reveal all of them under a confidentiality agreement. But he did accept VTB had been among those involved, and that it was Russian government-controlled.

Mr Milner three years ago invested around £500,000 in an online property investment fund for the super-rich set up by Mr Kushner and his brother Joshua in New York. Mr Kushner says his stake is worth around £15million – but initially failed to declare his interest in the company when he joined the White House team after Mr Trump’s victory last year.

Speaking to the Guardian about the tangled investments, Facebook spokesman Vanessa Chan said that the shares previously ultimately owned by Gazprom had been sold five years ago, and ‘rejected the notion of a lack of due diligence’. A spokesman for Twitter denied any wrongdoing.

In the United States an official investigation is under way into Russian interference in last November’s election.