Europe's richest man Bernard Arnault, 74, faces money laundering probe in France over 'ski-resort property deal' linked to Russian billionaire oligarch Nikolai Sarkisov

French billionaire Bernard Arnault and Russian oligarch Nikolai Sarkisov are under investigation for alleged money laundering at a luxury Alpine resort, according to Paris prosecutors.

The probe concerns their activities in Courchevel, a ski resort in the French Alps known for being a playground for the ultra-rich, they said late Thursday.

The French economy ministry’s financial intelligence unit is leading the investigation, but has yet to determine whether any crime had been committed, a source close to the investigation told AFP. It is understood they deny any wrongdoing.

French daily Le Monde, citing the Tracfin financial intelligence unit, reported that the 55-year old Russian billionaire had acquired 14 housing units from a single seller in 2018 for 16 million euros ($17 million at current rates) in a complex deal involving companies based in France, Luxembourg and Cyprus.

Although he is believed to be the buyer, Sarkisov’s name appears nowhere on the books of the company carrying out the purchase.

LVMH CEO Bernard Arnault and his wife Helene Mercier arrives for a state dinner in honor of Britain’s King Charles III at the Chateau de Versailles earlier this month

The probe concerns activities in Courchevel, a ski resort in the French Alps known for being a playground for the ultra-rich

The company, called La Fleche, is believed to have bought three more real estate units from a second company which, it’s believed to also belong to Sarkisov.

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The alleged sale of the real estate to a company he owns allowed the Russian to pocket a capital gain of 1.2 million euros, according to the paper.

Arnault – who runs luxury empire LVMH and is the world’s second-richest person after Elon Musk according to Forbes – said to have lent 18.3 million euros to Sarkisov for the deal.

He is then believed to have acquired La Fleche, effectively becoming the owner of the real estate portfolio.

The ownership change could have been designed ‘to hide the exact origin of the funds’, Le Monde quoted a Tracfin document as saying, as well as the identity of the ‘ultimate beneficiary’.

Investigators believe Sarkisov made two million euros from the operation, but they were still in the dark how much he had paid for the loan.

Contacted by AFP, LVMH declined to comment.

Le Monde, however, quoted a spokesman as saying that the operation had been ‘carried out with the strictest observance of the law’.

The paper also cited people close to Sarkisov as saying that the capital gain was ‘just a few hundred of thousands of euros’, and that the Russian had not been involved personally.

Le Monde said that according to ‘family lore’, Arnault has a special connection to Courchevel because he learned to ski there as a child and where he owns a mansion and a luxury hotel.

Hotel prices in the resort can reach several tens of thousands of euros per night, the paper noted.