Russia's Putin Corruption

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Putin CorruptionAn independent white paper

Moscow 2011Editorial boardV.Milov, B. Nemtsov, V. Ryzhkov, O. ShorinaTranslated from the Russian by Dave EsselIntroductionVladimir Putins decade in power associates in most minds with two highly negative phenomena anextraordinary increase in the abuse of power and corruption.Russia in 2010 managed to rank 154th out of 178 countries according to influential global civil societyorganisation Transparency International. Our peers in the list are some of the least developed countries ofAfrica (Congo, Guinea-Bissau) and other countries such as New Guinea and Tadzhikistan. TransparencyInternational considers Russia to be the most corrupt of all the major countries in the world, the so-called G20.Our BRIC colleagues (Brazil, China and India) rate way above us as well in 69th, 78th, and 87th respectively.Yet to say that Russia demonstrates an African level of corruption is no longer really true because corruption isfar less pervasive in many parts of Africa. In Egypt, hundreds of thousands of citizens, revolted by thecorruption in Mubaraks government, took to the streets and and forced him to resign. And thats Egypt, 98th inthe chart, with a corruption level one half that of ours.The myth that Putin has brought order to the country shatters in the face of reality.Table 1 below illustrates Russias corruption ranking over the years.

Table 1Countries are ranked for corruption according to a Corruption Perceptions Index (CPI). No perception ofcorruption wins 10 points, unrestrained total corruption 0. See Table 2.


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Table 2Russias CPI has been calculated since 1996, that is since Yeltsins second term of office, and presents aninteresting picture. The average CPI in the later years of Yeltsins rule was 2.4. That figure improved initiallyafter Yeltsin retired and Putin came to power, rising to 2.6 during Putins first term. This resulted from staffchange in the government apparatus, the simplification of the tax system, less regulation, and a reduction in thenumber of authorisations and licenses required in order to do anything.However, things changed again when Putin began his second term and the situation is now rapidly gettingworse and worse. By 2010, the CPI dropped like a stone from 2.6 to a record low of 2.1. Fraud and bribery ofunprecedented magnitude was overtaking Russia. Putin supporters frequently like to assert that corruption in thewild 90s was no lower than today. But the facts prove the opposite is true. If one looks at Russian Bureau of

Statistics Rosstats figures on the number of crimes involving corruption, the dynamics are clear a rise from2700 recorded cases in 1990 to 13,100 in 2009. [Source: Rising bribery, Russia Statistics Yearbook 2010, ]There can be no comparison between the scale of corruption under Yeltsin or under Putin. One of the clearestexamples is the incredible enrichment of the Luzhkov-Baturina family. In the 90s, the most shocking corruptionscandal involving them was the installation of plastic seating in the Luzhniki stadium: the Moscowgovernments call for tenders was won by the Mayors wife. The amount involved was a mere $700,000. Therewas a storm of protest. In 2008, there as another call for tenders, this time for the repair and refurbishment of V.Mukhins famous statue of the Worker and Peasant Girl. Once again, Baturinas tender won. But this time thesum involved was $100 million and there was not of whiff of a scandal and of course no investigation.The so-called Writers Affair provides another typical example. In 1997, a major scandal developed aboutroyalties paid to government employees for a book on privatisation. These royalties amount to $90,000. The

scandal led to a government crisis and in Spring 1998 the government was dismissed. Today, news about Putinaides getting government villas worth tens of millions of dollars excites no one and the aides in question do notlose their jobs. Moscow Deputy Mayor V. Resin, who has never worked in business, wears a watch costing $1million yet this does not lead the present rgime to investigate how he came by it or to his being fired.The situation with corruption is far worse now than it was back in the 1990s.Corruption has ceased being a problem in Russia; it has become a system. Its metastases have paralysed thecountrys social and economic life. The annual turnover of corruption in Russia now stands at $300 billion[Source: INDEM (Information Science for Democracy) Foundation investigation Diagnostics of corruption inRussia: 2001-2005 which has estimated that between 2001 and 2005 the value of corruption rose from 33 to 316


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billion dollars.] This amount is comparable in size to Russias budget as a whole and represents 25% of thecountrys GNP.Rising tariffs and prices are to a great extent due to corrupt activities by civil servants at every level and toPutinite monopolies. Backhanders, fraud, and bribe-taking add up to 50% to the cost of anything. This is why itcosts Gazprom three times as much to build a pipeline than similar pipelines would cost in Europe. [Source:Vedomosti, 17.03.2010: the undersea part of the North Stream pipeline is costing $10.6 million per kilometrefor a total of $12 billion for 1128 kilometres, with $2 billion unaccounted for. For a cost comparison betweenEuropean and Russian pipelines, see Mikhail Korchemkin, East European Gas Analysis. Building oil

pipelines also involve embezzlement and backhanders worth billions of roubles. [Source: A. Navalnys blogentryEmbezzlement la Transneft, 16.10.2010]. The bribes needed to enable home-building amount to 30%of the cost. In order to cover their ever-increasing costs, the monopolies and that authorities constantly increasethe charge for utilities, leading to higher prices across the board. And it is we who have to pay the price for thethievery and corruption of Putins power vertical.The Putin system is remarkable for its ubiquitous and open merging of the civil service and business, its use ofrelatives, friends, and acquaintances to absorb budgetary expenditure and take over state property, and the wayit stays and stays in power whilst functioning with near total opacity.Censorship of the media and the near-total annihilation of parliamentary rule is particularly harmful. Theabsence of parliamentary oversight over the executive, reinforced by a dearth of journalistic investigation intocorrupt activities makes an excellent culture medium for lawless outrages.

Corruption has ground down and destroyed the law-enforcement system. Many police chiefs see personalenrichment as their main priority. [In early 2011, Lieutenant-General Alexandr Bokov, the head of theCoordination Bureau for Combating Organised Crime and Other Criminal Activities in the CIS was arrestedand dismissed. He was accused of fraud in the amount of $46 million. A search was carried out in his 50-roommansion seated on 5 acres of land]. The priorities of such people do not include combating terrorism orprotecting citizens.This rgime with its power vertical of civil servants has also destroyed the independence of the courts.Administrative pressure has made the legal system dysfunctional and totally dependent on corrupt authority.Corruption has also reinforced Putins management principle number one: friends can have anything they wantand the rest can go to hell. Obedience of the law and delivering any kind of justice do not form part of the dealfor the civil servants of the Putin rgime. The supreme principle is personal loyalty. The main guideline of the

authorities today is: Stay loyal and youre free to steal, let the side down and you go to jail.President Medvedev, when he started, set up a commission for combating corruption which he himself headedup. The results, however, were nil, or maybe even negative. The rgime takes serious care of its corruptmembers. According to Supreme Court Chairman V. Lebedev, defendants in 65% of all the cases it reviewed,of which there were about 10 thousand for the whole country, received no more than a suspended sentence[Source: report in Kommersant, 28.01.2009, of V. Lebedevs speech at a meeting RF court chairmen].In the wider world, a number of countries are successfully defeating corruption. Leading examples includeNorway, Germany, Italy, Spain, the USA, and Singapore. The most recent successful example is Georgia. Theman who made the Singapore miracle, Lee Kuan Yew, eradicating corruption and bringing about fantasticeconomic success, stated in an interview with Vedomosti on 26.10.2005 that three principles must be met toresolve the problem of corruption:

1. Ensure clean and honest people are in ruling positions;2. Ensure that punishment for wrongdoings ensues without fail;3. Ensure that decent wages are paid and that civil servants are well-rewarded for honest work.Not one of these principles is applied in Russia today. We feel certain that the problem of corruption will not beresolved unless the central authorities are cleaned up. Fish rot from the head down. This problem will thereforenot be resolved while a kleptocracy that thinks only of its personal enrichment heads the country. For thisreason we will not, in this report, be looking at each and every form of corruption that exists but will ratherconcentrate on the situation with corruption at the top.We will present incontrovertible evidence of unprecedented and outrageous corruption in the highest chelonsof power in Russia. We will describe how Putins cronies from the Ozero dacha condominium metamorphosed


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from run-of-the-mill businessmen into dollar billionaires. We will tell of the luxury in which the leaders of ourcountry live and the lifestyle they maintain. We will explain how they manage to make you and me pay for it.Finally, in the concluding chapter, we will lay out our plan of anti-corruption actions. we understand that it willnot be possible to eradicate corruption completely. On the other hand taking Russia from Guinea-Bissau levelsto at least the level of some Eastern European country or that of Georgia is a perfectly realistic aim, an aim thatfurthermore will be good for the countrys development.If this problem is not resolved, Russia is fated to eternal backwardness and her citizens to eternal poverty anddisenfranchisement.

The Enrichment of the Members of the Ozero Dacha CondominiumThe Ozero (Lakeside) Dacha Condominium on the shore of Lake Komsomolsky in the Priozersk district ofLeningrad Region was set up in November 1996 by 8 people: Vladimir Putin, Yuri Kovalchuk, NikolaiShamalov, Viktor Myachin, Vladimir Smirnov, Vladimir Yakunin, and the brothers Andrei and SergeiFursenko.One of the founder-members of the Ozero condo, Vladimir Putin, became in 2000 the President of the RussianFederation; the others suddenly became extremely rich. This applies first and foremost to Yuri Kovalchuk andNikolai Shamalov who now bask in the upper reaches of Russias billionaire list, controlling respectively 33.5%and 12.7% of AKB Rossiya, a Petersburg bank.At the start of Putins rule, AKB Rossiya was a small bank with a capital of less than 1 billion roubles. It wasnot even in the top 100 Russian banks. But then it came to pass that the government sold to that bank at knock-

down prices large financial and media assets that had previously belonged to the state-owned companyGazprom. Boris Nemtsov and Vladimir Milov have described the schemes in detail in their white papers Putin The Results and Putin and Gazprom. Here is a brief chronology of the exfiltration of Gazproms assets infavour of AKB Rossiya: In 2004, Gazprom puts its subsidiary Sogaz (Gas Industry Insurance Company), one of Russias largestinsurers up for sale and it eventually ends up under the control of AKB Rossiya. Fifty percent of Sogaz shareswere sold by Gazprom for $58 million. We estimate Sogaz current value to be around $2 billion. In August 2006, Sogaz, now already owned by Rossiya Bank, buys 75% plus 1 share in Lider, the companymanaging Gazfond, Gazproms pension fund.Gazfond is Russias largest private pension fund with reserves today of nearly 300 billion roubles.The Lider shares were sold to Sogaz by Gazprom for just 880 million roubles, this despite the fact that in 2006

alone Liders profits had amounted to 1.2 billion roubles. Rossiya Banks owners were already prepared for thisdeal which was to give them control over the pension fund: in 2005, Yuri Shamalov, son of Rossiya Bankshareholder and Ozero Dacha Condo founder Nikolai Shamalov, was appointed chairman of Gazfond.

Shamalov Sr. (left) and Shamalov Jr.What this all meant is that Shamalov Jr. as head of Gazfond sold shares in the company managing Russiaslargest private pension fund at a fantastically low price to the bank owned by his father, Shamalov Sr.


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After winning control of Gazfond, Rossiya Bank gained control over Gazprombank, one of Russias largestbanks. OAO Gazprom, instead of selling its shares in Gazprombank on the open market for real money, letthem pass to Gazfond (then controlled by Rossiya Bank) in a cashless share swap as a result of which by April2007 control of Gazprombank (50% plus 1 share) was consolidated by Gazfond, itself controlled by Kovalchuk,Shamalov, and co. Gazprombank, the market value of which was, according to experts, in the order of $25billion, went from the control of Gazprom without Gazprom getting a single kopeck of live money for itsvaluable asset. In July 2005, Gazprom-Media Group and the NTV and TNT television channels were sold to Gazprombank.

Gazprom was paid just $166 million for the shares. Less than 2 years later, after Gazprom-Media had passed, aspart of Gazprombanks assets, under the control of Rossiya Bank, the then vice-premier Dmitri Medvedevvoiced a quite different valuation of Gazprom-Media $7.5 billion. If that is their true value, then Gazpromsold its assets for 45 times less than they were actually worth.All these deals were approved by OAO Gazproms board of directors, on which there was always a majority ofrepresentatives of the government, who would have received instructions on how to vote from governmentleaders subordinate to V. Putin. The first deal transferring Gazprom assets into the hand of Rossiya Bank tookplace in Summer 2004, a few months after Mikhail Kasyanov resigned his post of Chairman of the Governmentof Russia.As a result of these manipulations to take assets out of state-owned Gazprom and give control of them to AKBRossiya, that banks own assets rose from 6.7 billion roubles in early 2004 to 231.7 billion on 1 October 2010

(lifting it from Russias 70th to 19th largest bank).The total value of the assets exfiltrated from Gazprom (that is to say removed from state ownership and placedinto the private hands of Putins friends from the Ozero Dacha Condo) amounts to about $60 billion (or twicethe deficit in Russias pension fund). [See V. Milov, B. Nemtsov, Putin and Gazprom, Moscow 2008].These deals helped to increase the wealth not only of Putins partners from the Ozero condo but also of some ofhis relatives.In particular, yet another of the shareholders in Rossiya Bank, owning 3.9% of its shares through hisPetersburg-based company Aktsept, is Mikhail Shelomov, Putins great-nephew. Mikhail Shelomov is thegrandson of Ivan Shelomov, a former head of the 7th Department of the 1st Directorate GUPT NKVD of theUSSR and the older brother of Maria Putina, Vladimir Putins mother.Through his company Aktsept (he owns 99.9% of its shares), Shelomov also owns 12.5% of insurance company

Sogaz, the insurer that was sold without public tender and at a knock-down price by Gazprom in 2004.Yet another of Putins great-nephews, Mikhail Putin, is also today to be found in Sogaz, as a deputy chairmanof the board. Mikhail Putin worked in Gazprom from 2004 to 2007, heading its medical directorate, whichpurchased medical equipment worth $100 million or so.A Putin by any Other Name (left) and GorelovAs a result of all the government-approved deals to transfer assets from Gazprom to AKB Rossiyas control,Ozero condo founders Yu. Kovalchuk and N. Shamalov have made their way into Russias official billionairelist. Finans magazines list of billionaires, published in February 2011, has Yu. Kovalchuk in 115th place andgives his worth as 30 billion roubles (~ $1 billion) and N. Shamalov in 184th place with a worth of 18 billionroubles.Other AKB Rossiya shareholders and old acquaintances of Putin hold places on the billionaire list. One

should note in particular the holder of slot 17; worth 271 billion (~$9.5 billion), this is Gennadi Timchenko, theco-owner of oil trading company Gunvor, who will be discussed separately below. Timchenko owns 9.6% ofRossiya Banks shares and so also made himself a handsome profit when Gazprom assets were sold at a bargainprice to the bank.Dmitri Gorelov, number 182 in Finans magazines list, is wealthy to the tune of 18 billion roubles and yetanother AKB Rossiya shareholder with a 12.7% shareholding. D. Gorelov is also chairman of the Petromedholding, one of the founders in 1991 of AOZT/ZAO Petromed, another co-founder of which was the committeefor foreign economic relations St. Petersburg Mayors Office, then headed by Vladimir Putin.Dmitri Gorelovs son Vasili jointly owns, with Nikolai Shamalov, Vyborg Shipbuilders which in 2006, rightafter it was bought by them, was awarded a 59-billion-rouble Gazprom contract to build two sea platforms forthe Shtokman field. For 10 years prior to that, Vyborg Shipbuilders had not had a single serious order.


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Nikolai Shamalovs youngest son Kirill has also had a nice spot found for him (while his older brother headsGazfond). He is vice-president of the Sibur Oil-and-Gas Holding for administrative business support (or inother words, for the absorption of government monies). He was appointed to this post at the age of 26, less than4 years after his graduation from St. Petersburg State University.Sibur used to belong to Gazprombank. However, in December 2010, Gazprombank sold 50% of its holding inSibur to Leonid Mikhelson, the head of Novatek (another major shareholder in which is Rossiya Bankshareholder Gennadi Timchenko). Gazprombank plans to relinquish its remaining 50% shareholding in Sibur toNovateks head in the course of 2011.

***Other Ozero Dacha Condominium founders have also found their way into leading posts in the federalgovernment and in state-controlled companies since Putin came to power. Vladimir Yakunin was in 2000 appointed deputy minister of transport, later 1st deputy minister of railways,and from 2003 1st vice-president of OAO Russian Railways then from 2005 head of the same. OAO Russianrailways had a turnover in 2010 of nearly 2 trillion roubles. Vladimir Smirnov in May 2000 was appointed Managing Director of FGUP Enterprise for Supply of theManagement Directorate of the President of the Russian Federation. [FGUP stands for Federal State UnitaryEnterprise] and from 2002-2007 headed OAO Tekhsnabexport, a commercial arm of the Ministry for AtomicEnergy. Tekhsnabexport is one of the worlds largest supplier of products and services for the atomic energycycle and does about 40% of the worlds uranium enrichment. In 2007, Smirnov was transferred to the post of

adviser to the director of AtomEnergoProm.Vladimir Smirnov was in the past closely linked with the well-known mafia businessman Vladimir Barsukov(Kumarin), who is currently in jail. Back in 1994, V. Smirnov was head of the Petersburg subsidiary of theGerman company SPAG and Kumarin was a member of its board. In 1999, SPAG was accused by the BND(Bundesnachrichtendienst, the German Federal Intelligence Service) of laundering money for Russiasorganised crime and also for Columbian drug dealers. SPAG director Rudolf Ritter was arrested for this in2000. Between 1996 and 2001 V. Smirnov was also in the upper management of ZAO Petersburg FuelCompany. During the same period Kumarin-Barsukov was its vice-president and to all intents and purposescontrolled the company. Rif-Security, a security company controlled by Kumarin-Barsukov and V. Smirnov,provided security services to the Ozero Dacha Condominium. Sergei Fursenko, director (2003-2008) of LenTransGaz, one of Gazprom largest subsidiaries with a turnover

in 2008 of 50 billion roubles. From 2008 head of National Media Group (owner: Rossiya Bank), the holdingcorporation of the NTV and Pyaty Kanal television channels, the newspaper Izvestiya, and from late 2010 of25% of Channel 1 of Russian TV purchased from Roman Abramovich. S. Fursenko is in addition to this thehead of the Russian Football Union. Andrei Fursenko, from 2001 to 2003 deputy minister, first deputy minister, and acting minister of industry,science and technology; from 2004 minister of education and science of the Russian Federation, which ministrycontrols federal budget spending on civilian education and science (800 billion roubles in 2011).***Rossiya Bank, now richer by far thanks to generous concessions to it of Gazprom assets, has become to allintents and purposes the family business of the founders of the Ozero Dacha Condominium: over 50% of itsshares belong to Yu. Kovalchuk, N. Shamalov, and Putin relative M. Shelomov. Their relatives work in

important positions within the bank. Shamalovs son heads the Gazfond pension fund. Putin relatives ownshares in Sogaz and occupy important posts in it.Putin and his Billionaire FriendsThe members of the Ozero Dacha Condominium are not the only ones to have made it to riches thanks to beingfriends or acquaintances of Putins. In this chapter we will outline the story of Mr. Timchenko, an old friend ofPutins, and of the Rotenberg brothers, who have known Putin from since they were young men practising judotogether.Putin first met Gennadi Timchenko in the late 1980s. At that time Gennadi Nikolayevich worked in an oilrefinery where he had a low-level job in its commercial department. Timchenkos work included being involvedin organising oil sales abroad. The first business in which Timchenko and Putin were involved together beganwhen the future president was [Petersburg mayor] Sobchaks deputy and headed the foreign relations


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department. This was back in the 1990s when times were difficult, when there was not enough food, medicine,or elementary consumer goods. Through Sobchaks efforts, the Petersburg mayors office obtained the right tosell metal and oil for export in exchange for food.A company called Golden Gate was set up [Source: Financial Times, 15.05.2008]. Its founders were theDepartment for Foreign Relations (Putin) and elements of Mr. Timchenkos organisation. Shortly thereafter, thecompany sold 100,000 tonnes of oil products, worth in those days $70 million. Nothing came back toPetersburg in exchange, however. [Source: Putins Secret Ally, the King of the Oil Trade, Wall Street Journal11.06.2008; Financial Times 15.05.2008].

A group of city councillors headed by Marina Salye set up a commission to investigate fraudulent dealingsconnected with Putins foreign economic activities and the mayors office. The results were published [byjournalist A. Barabanov]. But a court case was never brought.

Timchenko meanwhile continues to trade in oil and in 1999 relocates to Finland. He is still a quite unknown oiltrader. According to Finnish tax records, his income that year amounted to 327,000 Euro. After Putin came topower, however, Timchenkos business goes on the up and up. By 2000, he declares an income of 1.5 millionEuro and in 2001 nearly 5 million.


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In 2008, Timchenko, with $2 billion to his name, makes it into Forbes Magazines list of dollar billionaires. InFinans magazines latest (February 2011) rating of Russian billionaires, Timchenko is in 17tth place with aworth of 271 billion roubles (~$10 billion).The reason this little-known Petersburg businessman rose to such heights lies in the sheer volume of exports ofoil and oil products. As a Finnish citizen and a Swiss taxpayer, this gentleman controls over of Russias oilexports. [Source: Come in, Number 3, Vedomosti 01.11.2007; Our Man of the Week: Gennadi Timchenko,Vedomosti, 28.06.2010].Of particularly important note is the fact that Timchenko in the main trades in oil from the state-owned

companies Rosneft and Gazpromneft plus Surgutneftegaz, which is closely tied to the government. [Source:New Oil Plenipotentiary, Vedomosti, 30.11.2007].***Starting in 2007, Timchenko companies export 60-90 million tonnes of oil and earn about 80 billion dollars. Hiscompanies furthermore enjoy a most-favoured status. When Russia had its conflict with Estonia, exporterssuddenly faced great difficulty in moving oil products through that country. Well, all of them except forTimchenko companies. [Source: Putins Secretive Ally The Oil Trading King, Wall Street Journal11.06.2008]. The magnitude of the international dispute notwithstanding, the Russian authorities do not putdifficulties in the way of his exporting oil.Everyone knows that decisions regarding exports from state-owned companies are very much the prerogative ofthe president and government. Oil is a strategic resource for Russia and the government keeps a beady eye on

matters relating to it. How and on what basis Timchenko was selected to be the conduit for nationalised Russianoil, and what part Putin played in the matter, is something that will one day be explained along with howcome Timchenko sells oil from the former Yukos company and how he happens to be one of the founders of theinfamous BaikalFinansGroup through which Rosneft got its hands on Yukos [Source: Le Monde, 11.07.2007].This fly-by-night company, whose registered address in Tver was the location of the London Bar, remains amystery to this day. All Putin has said about it is that its founders were people well-known to him and who hadbeen in the oil business for a long time [Source: Putin Discloses Who is Behind the Company That BoughtYugansk, Lenta.ru, 21.12.2004].Timchenko is of course, together with Mr. Kovalchuk, a major shareholder in Rossiya Bank. This previouslyunremarkable Petersburg bank now controls Gazproms most liquid assets (Gazprombank, Gazprom-Media,Gazfond, Sogaz, and more). Timchenko and Kovalchuk gained control of all these for practically nothing no

tenders, no bids, no nothing. State-owned Gazprom, controlled by Putin, was dropped into Timchenkos and hisfellow shareholders laps in a regal gift worth billions of dollars. Why Gazproms billions should have gone toKovalchuk and Timchenko remains a complete mystery.Until recently, Timchenkos construction companies used to get juicy billion-rouble orders for Gazprombuilding projects. The privilege has since passed to those other friends of Putin, the Rotenberg brothers (seebelow). But Timchenko is not hurting: he is now one of the main contractors to state-owned RosNeft andTransNeft. [Source: Keeping Things Tight, Kommersant, 14.12.201; The Timchenko Networks, Vedomosti,27.04.2010].In addition to all this, Timchenko is the top shareholder of Novatek, Russias largest gas producer afterGazprom. This company enjoys uniquely preferential treatment at the hands of the state. As is well known,Russia has instituted a state monopoly on gas exports: only Gazprom can sell gas abroad. Although an

exception was made for Timchenko: Novatek exports gas under a nominal agreement with Gazprom! In 2010,state-owned Gazprom sold a 9.4% shareholding in Novatek to Timchenko companies. Nothing unusual aboutthat except for one thing the price: Gazprom sold its shares for $1.9 billion. This was $1.3 billion less thantheir market value, making Timchenko and his partners richer by the same amount at the expense of the Russianstate (Gazprom).***We can enjoy more of the same thrills when looking at the development of the business of Rotenberg brothersArkadi and Boris. The two practised judo together with Putin back in the 1960s. Later, Arkadi Rotenbergbecame president of the Yavara-Neva Sports Club, of which Putin is the honorary president and one of thefounders is here we go again! G. Timchenko. [Source: Brotherly Love and Sharing at Gazprom, Vedomosti,09.03.2010]. But its not just sport and being young men together that bind Putin and the Rotenbergs. Little-


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known entrepreneurs in the 1990s, the Rotenbergs are now dollar billionaires, the largest suppliers of pipes toGazprom, and major pipeline construction contractors. Having bought up Gazproms construction assets at arock-bottom price, the Rotenbergs set up a company called StroiGasMontazh. By 2008, this company waswinning tender after tender for pipeline construction. [Source: Gazprom Looks After Its Own, Vedomosti,10.09.2009]. StroiGasMontazh won the tender to build the North Stream pipeline, despite the cost being threetimes that of building similar pipelines in Europe! Despite the fact that our workers are paid far less thanEuropean ones.Without even going through a tendering process, the Rotenbergs were given the contract to build the epoch-

making Sakhalin-Khabarovsk-Vladivostok pipeline at the astronomical price of 210 billion roubles.The Rotenberg were also given the Dzhugba-Lazarevskoye-Sochi Olympic pipeline contract without having togo to tender.The Russian government raises the price of gas every year. This in turn raises utilities prices. We should allunderstand that these price hikes are the result of friendly/criminal deals such as these with the state/Gazpromon one side and friends of Putin on the other.We wrote in our report PUTIN: What 10 Years of Putin Have Brought about the catastrophic degradation byalcohol that is happening in Russia, where per capita consumption for every man, woman and child has nowreached 18 litres of pure alcohol a year. A key reason why we are all getting so sozzled is the unbelievableavailability of vodka. Alcohol and vodka are so lowly taxed that a bottle of vodka costs about the same as twoor three bottles of beer. Never before in Russia (or the world) has this been the case. Never before has a bottle

of vodka cost the same as 4 subway rides. We could see no reason for such a state of affairs until now. Whenwe started looking into the Rotenbergs businesses, we found out that they control no fewer than 11 alcoholproduction plants in the RosSpirtProm system. [Source: The Kremlins Alcohol Plenipotentiaries, Vedomosti,20.04.2009; Unto Ones Own, Novaya Gazeta, 04.02.2011]. These include BryanskSpirtProm, the Kristallvodka distillery, the Astrakhan Liqueur and Vodka Plant, MordovSpirt, the Bakhus plant in Smolensk, andother alcohol production facilities in Cherepovetsk, Yaroslavl, and elsewhere.Could that be the reason for the low tax and excise on vodka in Putinite Russia? Would Putin put up taxes forhis friends? The cheaper the goods, the more you can sell. And that fact that the population of a vast country issinking into alcoholism isnt something the current government is that worried about.The scandalous story of the Moscow-St. Petersburg tollroad cutting through the Khimki Forest is well known.Putin authorised the construction. Putin stood unshakeable when the public protested. He stood his ground even

when President Medvedev put a temporary halt to the work. Eventually, it was decided to build the road throughthe forest, despite the objections of the residents of Khimki and of ecologists. Why this went the way it did isnow clear the 63.4 billion rouble contract to build the tollroad had been given to companies owned by theRotenbergs. [Source: Kovalchuk/Rotenberg Highways, Vedomosti, 20.09.2010].Putins government has agreed to provide 23 billion roubles of funding for the road. But the toll income will goto the Rotenbergs.The Moscow-Minsk Highway is a repeat of the same story, although with the contract for this one going toanother Putin friend Yu. Kovalchuk. The state pays and Putins friends rake in the profits.Using their long-time links to Putin, the Rotenberg brothers were able to offer protection to multi-billion roublebusinesses. They became shareholders in the Port of Novorossiisk (the countrys largest oil terminal) byoffering shareholders A. Ponomarenko and A. Skorobogatko their services in protecting the business from

another Putin acquaintance, Nikolai Tokarev (of TransNeft). [Source: Presidential Judo and the Port ofNovorossiisk, Leningradskaya Pravda, 14.04.2008, see ; Protective Moves, Vedomosti, 14.04.2008].Much the same happened with Ashot Egiazaryans business. In order to ensure that his company was safe frompredation by Luzhkovs wife Baturina, Egiazaryan ceded without payment a 50% share in it (the construction ofthe Moskva Hotel) to the Rotenberg brothers. [Source: Milov/Nemtsov, Putin and the Crisis, 2009].Two Slaves on a Gilded GalleyVladimir Putin gave a curious reply when he was asked what he though was the point of living. His responsewas that for a man, the most important thing was to experience new sensations.Russia ruling lite, which has risen out of deprived Soviet childhoods, has thrown itself wildly upon everyobject and attribute of luxury glimpsed in rare foreign films about the good life that managed to scrape pastthe censor. The arms race has now become a luxury race, this in a country where 70% of the population dwell in


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poverty, partial or total. Politicians and civil servants who officially live off their salaries, strive to keep up withtheir oligarch friends and not be outdone in their consumption of the most expensive goods and services, themost recherch entertainments and delights, competing even with the Russian tsars and aristocrats of the pastand the Arabian sheikhs of today. The top figures of our government are leading the whole vertical of powerfrom the front in this rush to luxury.YachtsA luxury yacht, the Sirius, sailed into Sochi in early 2011. This yacht was bought by the Office of PresidentialAffairs (that is to say with money from the countrys budget) for 26 million sterling (~$41 million). The yacht

can accommodate 11 guests and 12 crew, The president plans to receive heads of state and government leaderson her during the Olympics in 2014 and other events. The yacht has 6 VIP cabins and is over 50 metres long.The Siriuss important guests will have at their disposal a wine cellar, a saloon with panoramic sea view, a spapool with waterfall, a jacuzzi, a barbecue and other amenities. The standard calculation for the running costs ofyachts is 10% of its value per year, say $4 million, which would pay the average pension for 1400 Russianpensioners.

Captain Putin goes to SeaIt is worth mentioning that not that many heads of state are provided with yachts. Those who do actually haverather more modest ones. For example, the Finnish presidents yacht cost 2 million, the King of Belgiumsjust 4.6 million, while Elizabeth II, Queen of England, no longer has a yacht at all since the retirement of thefamous yacht Britannia.This Sirius, according to the official account, replaces the recently scrapped 45-metre presidential yachtKavkaz which was built in 1980 for Leonid Brezhnev but had recently undergone a full refurbishment (in theearly 2000s) costing, according to various sources anything from $1 million to $2.8 million, during which she

was given new air conditioning, a cinema, hardwood furniture and panelling, and so on.Besides this sea-going vessel, the head of state also has at his disposal an old (1973) riverboat, the Rossiya. Shewas also recently refitted in 2005 at Petersburg Northern Docks. The works were overseen personally by thepresidents chief of administration V. Kozhin, Petersburg governor V. Matvienko, and presidential envoy I.Klebanov. The Rossiya is 86 metres long and has 3 VIP cabins, 9 twin cabins, a conference room, a saloon, arestaurant and a sauna. The cost of the refurbishment is being kept strictly secret (which in itself is strange sincethe vessel is on the national budget) but is reckoned to have been in the order of $1.2 million.But the yachts dont end here. As journalists from Novaya Gazeta uncovered, under Putin luxury yachts arebeing almost routinely bought and put into service.The 32-metre yacht Pallada, designed in Holland and built in Moscow for $4-6.7 million was bought for the300th anniversary of St. Petersburg in 2003. It offers all the usual luxuries: teak decks, expensive furniture with


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white leather armchair and settees. Three decks. Cabins and saloons to a total of 390 square metres. Tintedwindows. One deck shielded for privacy. The Pallada also boast a sauna and a cinema. She can accommodateup to 8 guests. Decorated throughout with pictures of Peter the Great. Tony Blair and Gerhard Schroeder wereguests of Vladimir Putin on board this yacht in St. Petersburg in May 2003.A VIP speedboat costing $3 million was also bought for the same 300th anniversary. This vessel is nowregistered with the Russian Naval Base of St. Petersburg.The jewel in the crown of the Kremlin fleet of yachts must be the Olympia, a mega-yacht which first appearedin the port of Sochi in Summer 20002. This fifty-seven metre 5-deck yacht cost about $50 million and is one of

the 100 largest yachts in the world. Yearly operating costs for the Olympia must therefore be in the order of 150million roubles. The yacht is built to royal standards: hardwood and rattan interiors, gilding, jacuzzi, bar andbarbecue, a colonnade in special maplewood, marble bathrooms, and so on.The connection between the Olympia (registered offshore) with the Kremlin has been confirmed not just byloose tongues among the Sochi Port workers but also by the fact that the FSO has been seen guarding it and thata special commission came down from Moscow to take the boat in charge. Kremlin sources have stated theyacht is used by President Putin. The Olympia is managed by Cyprus-registered Unicom Managment Services,which belongs to 100% state-owned OAO Sovkomflot, the chairman of whose board of directors was at thetime Putins presidential aide Igor Shuvalov. Roman Abramovich, the Russian billionaire and goodacquaintance of Putin, has been named as one of the buyers, and hence gifters, of the Olympia.In early 2010, British High Court Justice Andrew Smith gave judgement on the case between Sovkomflot

versus its former chief executive Dmitri Skarga and businessman Yu. Nikitin. The judges ruling contained aninteresting fact: Skarga had remarked during the hearing that a yacht had been given to Putin. When asked by aForbes magazine reporter what yacht he was referring to, Skarga referred him to an article in Novaya Gazetaabout the yacht Olympia. Where the Olympia now berths, who her actual owner is, and whether Russia top menstill sail on her is now a complete mystery. [See interesting article here Trans.]How does this all add up? The Putin-Medvedev tandem have at their disposal a mini-fleet of at least five luxuryyachts and speedboats, together worth not less than $110 million. These furthermore cost the country millionsmore in annual maintenance. This puts our Russian lords and masters on a par with not the heads of theworlds democratic countries or of the BRIC countries but with the king of Saudi Arabia and his family (15megayachts), other Arab sultans and sheikhs (9 megayachts), and his friend Silvio Berlusconi with his 4 yachts.We should note in passing that Berlusconi has, unlike Russias leaders, officially declared his yachts; he was

after all a billionaire businessman before he came to power.Villas and PalacesOur Russian tandem seem to be as attracted to luxury villas, estates, and palaces as they are to yachts. Theexistence of such places is carefully concealed and disguised. The luxury properties are frequently formally onthe books of state corporations or even registered to private individuals from among Putin and Medvedevsclose friends. Information still reaches the media, however. [Source: Behind Locked Doors, Kommersant-Dengi, 31.01.2011, see - - ]. That the residences belong to top-rankingofficials can be determined through circumstantial evidence: for example, if they frequently vist the place, or ifit is subject to special secrecy and security measures (e.g. guarded by the FSO whose main job is to protect thecountrys top people).In all, the president and the premier are linked with the use of 26 luxury premises located in Russia and abroad.

This number has been rising ever since our two heroes have been in power.Officially, the countrys two top men have 5 residences. Dmitri Medvedev has: Gorky-9 (near Moscow),Bocharov Ruchej (Sochi), and Dolgie Brody Valdai (near Novgorod). Vladimir Putin has: Novo-Ogarevo(near Moscow) and Riviera (Sochi).Besides these, the state has on its books (which means paid for by the taxpayer) another 10 estates that are at thedisposal of the countrys top leaders: the Konstantine Palace (Strelna, S. Petersburg), Shuiskaya Chupa(Karelia), Volzhsky Utyos (on the Kuibyshev reservoir, Volga River), Tantal (on the Volga, near Saratov),Angarskie Khutora (Irkutsk District), Maly Istok (near Yekaterinburg), Dom Sevastyanova (Ekaterinburg),Sosny (Krasnoyarsk Region), Mein Dorf (a gothic mansion on the Rublevskoye Shosse near Moscow), Rus(Tver District, in the hunting reserve). Many of these places have not been used in years but vast sums are spent


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on their maintenance and security and on keeping them ready to receive their grand masters at a momentsnotice.Russia is great and beautiful and the members of the tandem keep being invited to new and especially beautifulplaces. And theres always a good reason to build another new residence. For instance, one is currently beingbuilt in the Far East, on Russki Island (stated purpose for the two-day APEC summit scheduled for 8-9September 2012). The residence will occupy 1400 acres on Boyarin Bay and is due to cost the budget 7.7billion roubles ($250 million). The same year should also see the commissioning of a new state residence on theBaltic seashore in Kaliningrad, not far from the Curonian Spit, which before the war, when the town was still

called Neukuhren, was considered to be the best resort area on the Baltic and in East Prussia.The media have also linked other places with our countrys leaders, for example Lunnaya Polyana (a sportingcomplex in Adigei, on the slope of the Fisht), Barvikha (the government dacha on the Rublevskoye Shosee nearMoscow), a secret FSB location near Moscow known only as ABC, and Doctor Vinters Dacha (Sortovala,Karelia).The so-called VIP Guest House near Paris has aroused considerable interest. According to the press, this wasbuilt and paid for (30 million) by the Presidential Affairs Office. In luxury, it approaches Versailles. Whoowns the place, how the expensive works were paid for, and what purpose the place serves is kept a great secretTypically, any journalist who asks about what real estate is available to the countrys leaders and what theirmaintenance costs is told in reply that such information is a state secret (!). This notwithstanding the fact thatour leaders lovely lives are paid for out of the budget, out of taxpayers money, which means that this

information may not be classified. An entrepreneur from Sverdlovsk District, Sergei Karpov, who addressedenquiries about these matters to the General Procurators Office, calculated that the building and maintenance ofthis luxury infrastructure was costing the budget 164 billion roubles (or 3 times the annual budget of a largeregion such as the Altai, with all its schools, hospitals, and public buildings AND it 2.5 million population!).In fact, Altais lovely mountain scenery has also caught the eye of Vladimir Putin, who likes to holiday there. Agrandiose, by local standards, construction is rising up at the spot where the Ursul River flows into the Katun.Formally, the contractor and owner of the future Altai Compound is Gazpromneft, a subsidiary of Gazprom,which is spending no less than 1.5 billion roubles on the project. Furthermore, a new road is being built to thecompound (which has been allocated 5000 acres or more) all the way from the Chuisky Trakt. That is 21kilometres of mountain road for which 190.5 million roubles per kilometre (!) was promptly allocated fromgovernment money over 4 billion roubles, including 120 million from the Altai Republics beggarly budget.

In other words, the oil-and-gas folk will have over 5.5 billion roubles of state-owned company and governmentmoney spent on their cosy compound, this when the little republics total annual budget is 9 billion roubles! Forsome unknown reason, this corporate campus is being provided with security by the FSO, access is strictlycontrolled, and anything to do with the project is kept strictly secret. Besides the security provider, another factlinking Putin personally with the Altai Compound was a statement by the senator from Altai, Ralif Safin, at ameeting of the republican parliament. It hardly needs to be added that the road construction and actual buildingworks are being carried out without the necessary approvals, that cuttings are being made in the mountains tothe detriment of the local landscape, and that 40 archeological sites have already been badly disturbed. Thecompound has had a 110 kilovolt power line run out to it and over one hundred heavy goods vehicles at a timehave been involved plowing up and down the road.But the above projects all pale beside the latest palace scandals to do with the countrys leaders. In late 2010,

businessman Sergei Kolesnikov, who was formerly close to some of Putins friends, emigrated from Russia andwrote an open letter to president Dmitri Medvedev in which he disclosed that a luxury palace for the prime-ministers personal use was being built on the Black Sea coast at a cost of over 30 billion roubles ($1 billion).


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Putins Home Sweet (really, really Sweet) HomeSource: Russian Wikileaks ruleaks.netAsNovya Gazeta was able to discover, the decision to build this palace outside the village of Praskoveyevkanear Gelendzhik, Krasnodar District, was taken in 2005. Documents in relation to this were prepared and signedby subdivisions of the Office of Presidential Affairs and the works were all carried by a company (Lyrus) withclose links to Ozero Dacha Condo member Nikolai Shamalov.A complete luxury town was being built on the shores of the Black Sea, comprising an enormous Italianatemain building, its palatial gates topped by a two-headed eagle, a health complex, a 3-seater helicopter pad, atea house, elevators down to the beach, and much more. All this was being built on land released by agovernment decision from its forest designation and from which its ancient natural pine forests were promptly

stripped. A road was also being built over the hills to the location, which is strictly guarded by the local police,private security guards, and of course the FSO.After this disclosure, the whole project suddenly became the property of Mr. Shamalovs company (and so to allintents and purposes his private property), complete with its palace, attendant buildings, and a great swathe ofgovernment land. The documents needed for this to happen were signed by presidential office manager V.Kozhin. According to Kolesnikov, Putin had taken a keen and constant interest in the building works and themoney for it became available to N. Shamalov from a combination of sources such as corruption, fraud, andbribes. As a result of certain corrupt schemes, Shamalov had accumulated $148 million, part of which in alllikelihood was put to use to build the palace near Gelendzhik. The contractor for the works is FGU Army Unit1473 and the security of this private palace is being provided in part by the FSO. So whose money is beingspent on this project? How did government land end up in private hands? Who is the true end-user and owner of

this Versailles on the Black Sea? No answers to these questions have as yet been found.After S. Kolesnikovs letter was widely publicised, new deals for the Gelendzhik palace were rushed through: itwas bought by a business partner of A. Rotenbergs, a certain A. Ponomarenko, a co-owner of the Novorossiiskfreight port, it is said for $350 million. Kolesnikov, however, asserts that the use to which the palace is to be puthas not changed. Many experts consider the deal to be mere window-dressing, designed to muddy the watersand shield the real customer.Something along the same lines is unfolding around the building of a new palace within the Bolshoi Utrishnature reserve, itself not that far from Gelendzhik. This equally secret site is being linked with the other halfof the tandem Dmitri Medvedev. This time, the official cover story is that it is a sporting and healthcomplex which is being built, one again, at the initiative of the Office for Presidential Affairs. In 2008, 300acres of land were re-allocated for this purpose from the reserve and transferred for a 49-year term to a non-

profit organisation call Dar. It so happens that Dars board chairman is one Iliya Yeliseyev, a fellow-studentof Medvedevs from Leningrad University who also worked for a long time at Gazprom when Medvedev wasthe monopolys chairman of the board. It is still not clear in this case who or what organisation is actuallyfunding the project, who authorised the removal of land from its nature reserve status, or for whom the newpalace is actually being built.WatchesRussia had a watch scandal in 2009. The newspaper Vedomosti published an investigation into the watchesworn by Russias leading civil servants. It turned out that Russias top-rankers, including civil servants who hadnever previously worked in business, had a love for super-expensive watches. It was discovered that first deputyCentral Bank governor A. Ulyukayev wore a $78,800 watch, head of presidential administration S. Naryshkin a$29,700 one, Minister of Finance Kudrin a $14,900 one, and so on. The shocking record was set by first deputy


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Moscow mayor Vladimir Resin (who was lucky enough to be overlooked in the recent anti-corruption wars inthe capital) with his $1 million wristwatch!Our leaders were not found wanting in this lite field either. In 2009, prime minister Putin twice gave plaincitizens Blancpain watches worth $10,500 each. The lucky recipients were the son of a shepherd from Tuvaand a fitter in Tula. Then, in August 2010, at the construction site of the Nizhy-Bureisky hydro-electric plant, hewent on to toss yet another Blancpain of the same value into the concrete mix for luck. The prime ministerthus offloaded watches worth $31,500 in a short span of time. But Putin wasnt tossing the last watch from hiscollection into the concrete mixer: the media have spotted other models of expensive watch on the prime-

ministerial wrist. He has also been seen wearing a $60K gold Patek Philippe and other major brands such as A.Lange & Sohne ($20-30K), a $20K Breguet, a gold Patek Philippe Calatrava ($20K), and an IWC ($3-4K). Alltogether, he has so far been seen wearing $160ks (4.8 million roubles) worth of various watches.According to prime minister Putins income declaration, he earned 4,622,400 roubles in salary in 2009 plus amilitary pension of 100,600 roubles. The prime ministers watches therefore cost more than his annual income.Does one need any other argument to emphasise the need for a law obliging civil servants, starting just with top-ranking ones (the so-called A-category), to make a declaration of their spending?

Tick, tock, Mr. PutinSource: The Nation Watches, Vedomosti, 26.10.2009Dmitri and Svetlana Medvedev are not to be caught lagging behind Putin. In early 2009, Kommersant editorAndrei Vasiliev was suddenly fired following the publication of photographs of the presidents wife with anexpensive $30K Breguet on her wrist yellow gold, 128 diamonds, mother-of-pearl and so on. The story wenton to say that Dmitri Medvedevs wife had other, not quite so expensive, watches ($10-15K). Prior to that

article, Kommersant had also published a photograph of Medvedev himself with a $32K Breguet. During a visitto the Ukraine, he was seen to be wearing a $28K Glashtte. It is known that he at the very least also has a$18K Franck Muller and a $8K Jaeger-leCoultre. The presidential couple have an income comparable to that ofthe prime minister.Asked by Vedomosti about the presidents watches, his press secretary responded that the question was notproper, since it concerned the premiers private life. The president and prime-minister are, however, obligedto account for their incomes and if their expenditure clearly outstrips their incomes, the question is not abouttheir private lives but about corruption.Homes and CarsGiven what we have seen so far, the tandems declared real estate holdings and automobiles are a mere drop inthe ocean. Medvedev owns 2 apartments in Moscow (174 and 364 square metres) and another flat in St.

Petersburg. The larger Moscow flat has 4 bedrooms, a study, a dining room, large living room, 3 toilets, crystalcolumns, and a marble floor. Maintenance charges would run at about $5K a month. The flat itself is worth $5-7million. Officially, Vladimir Putin owns next to nothing: a 77m2 flat, a small plot of land, and a garage.As for automobiles, Putin has a new Lada Niva and Medvedev a rare vintage Pobeda. Putin also has a few oldcars and a Skif baggage trailer. Svetlana Medvedeva has a 1999 VW Golf. But perhaps they do not worry toomuch about such things given the flurry of yachts, dozens of residences, luxury car fleets that are paid for out ofthe budget or by state-owned corporations.CONCLUSIONSystemic corruption presents a threat to the security of Russia, Capital flight (over $38 billion in 2010 alone),and lack of investment, most importantly in the non-raw-materials sector, is leading Russia to become a raw-materials appendage of not just the West but of China too.


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Three hundred thousand people a year emigrate from Russia, mainly entrepreneurs, specialists, educated youngpeople, killing business activity in the country.The monopolisation of the economy, its concentration in the hands of Putin friends and acquaintances is leadingto sharply rising prices for goods and services and lowering the peoples standard of living.The dependence of the courts on the executive is leading to complete lawlessness. The people are deprived ofall rights.Colossal corruption is rushing Russia into the third world. One cannot even begin to think of modernisation orinnovation when African levels of corruption prevail.

The country needs a national programme to combat corruption.The Popular Freedom Party proposes:In Politics:1. To restrict the terms of the president, governors, and mayors to 2 terms, not just sequentially but even withintervals. This will require an amendment to the constitution so that no one can spend more than 8 years in suchpositions or return to power afterwards.2. To abolish the de facto political censorship that exists today in television in the first place and in other massmedia.3. A return to free and fair elections including real political oppositions.4. Restore the election of governors and mayors.5. Create an official parliamentary investigations committee.

In Law:1. Make it obligatory for civil servants to declare not only their incomes but the spending, as well as listing theirproperty. If their spending appears discrepant with their income, their property to be forfeited.2. Ratify Article 20 of the United Nations Convention against Corruption. This article calls for the adoption ofsuch legislative and other measures as may be necessary to establish illicit enrichment, when committedintentionally, as a criminal offence. It is for this reason that the Putin government has refused to ratify it.3. Introduce additional legislation to prevent relatives of civil servants from engaging in businesses in the areasregulated by their relatives in government. (This would put a stop to the ploys so enjoyed by Luzhkov andBaturina amongst others).4. Pass a freedom of information law making it compulsory for all government decisions to be published andavailable freely to any citizen. Documents to be classified only if they concern national defence and security.

The decision to classify to be subject to parliamentary control.In Law Enforcement:1. To hold an independent investigation of the activities of Putin and his civil service and business friends forpossible corruption. The results of the investigation to be widely publicised.2. To reform the MVD, the FSB, and the Procurators Office.3. The remuneration package offered to law enforcement officials to stimulate them to honest and long-termemployment.In the Economy:1. To reduce the number of civil servants by 800 thousand. That is how many extra civil service jobs have beencreated under Putin.2. The prime ministers duties to include heading the anti-monopoly office. A main task of a head of

government is to protect the conditions for equal competition, to prevent the monopolisation of markets, and tosupport small and medium businesses.3. To disband the state corporations. Investigate their past activities. Investigate the actions of the topmanagements of the monopolies, including Gazprom and TransNeft, for possible corruption.4. To privatise on the open market state and municipal property. State-ownership to be retained only for naturalmonopolies. Reducing the participation of the state in the economy will reduce the influence of civil servants onbusiness decisions and accordingly reduce corruption.5. To keep taxation down. Cancel the increase in social tax to 34% as conducive of corruption by drivingbusiness underground.


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The above measures will surely and rapidly lead to a reduction in corruption from Guinea-Bissau to EasternEuropean (Georgian) levels.Not much is needed to make this happen just political will and honesty on the partof the countrys leaders.Todays leaders do not have that. We do.