A simple and elegant scheme

Billionaires Deripaska, Mikhelson, and Gutseriev all provide financial incentives for Russia’s contract soldiers going to Ukraine

A number of industrial companies owned by Russian billionaire oligarchs Oleg Deripaska, Leonid Mikhelson, Sergey Gordeev, and Mikhail Gutseriev are involved in a scheme for providing financial incentives to contract soldiers willing to take part in the Ukraine war. Maria Zholobova and Anastasia Korotkova, investigative journalists working for the independent news outlet iStories, spoke with contract servicemen (called “volunteers” by the Russian authorities), as well as military recruiters, whose phone numbers link them to corporations like Deripaska’s Rusal, Mikhelson’s Novatek, and other industrial giants. Here’s the gist of their investigation, just released by iStories.

One of the contract servicemen who spoke to iStories was Igor Sergienko, a platoon commander in the Russian army’s Sokol (“Falcon”) battalion, where he is known by the nom-de-guerre “Shershen” (“Hornet”). Sergienko’s salary comes from two sources: 200,000 rubles a month (or just over $2,000) is paid to him by the Russian Defense Ministry, while another 100,000 comes from a sponsor he describes as a “company in the military-industrial complex.”

Neither Sergienko nor his recruiter, who also agreed to speak with the journalists, wanted to say more about the sponsor company’s identity. But the phone numbers given by the recruiter as contact information for prospective conscripts led the authors of the investigation to Rusal Management, a subsidiary of Oleg Deripaska’s Rusal. Another phone number provided by the recruiter for employment questions also belongs to Rusal Management. In the recruiter’s own words, Rusal’s military incentive scheme works like this:

We onboard a new employee the day before he signs a military contract, and next we suspend his contract with us, which leaves us legal grounds to pay him a stipend while he’s in the combat zone.

Sergienko’s employment record shows that in October 2022 he was hired by Ruslan, a private security company whose bank records reflect payments to mercenaries. According to iStories, Ruslan’s only clients in 2022 were two Deripaska-affiliated corporations.

The natural gas extraction company Novatek, whose majority owners are billionaire Leonid Mikhelson and Vladimir Putin’s longtime friend Gennady Timchenko, is also participating in a similar sponsorship scheme. One of the contract soldiers contacted by iStories shared his recruiter’s phone number with the investigators. The phone number, it turns out, is registered to Andrey Vasilyev, the CEO of Saturn-1, another private security firm, this time founded by Novatek. Although Saturn-1 isn’t formally a subsidiary of Novatek, almost all of its revenue in 2022 came from Mikhelson-owned ventures, including the Moscow-based contemporary arts center GES-2.

When contacted by iStories, the recruiter explained that payments to army “volunteers” are funneled through the Muzhestvo (“Valiance”) foundation, registered in September 2022. Nearly all of the foundation’s endowment (over 200 million rubles, or $2.2 million, based on the current conversion rate) were contributed by Novatek.

According to iStories, Sergey Gordeev’s PIK construction company and Mikhail Gutseriev’s Mospromstroy (another construction giant) are similarly involved in sponsoring and incentivizing contract soldiers.

Novatek, PIK, and Mospromstroy did not respond to the journalists’ queries. Rusal replied by denying any connection to military recruitment or any knowledge of other organizations’ use of its registered phone numbers. Although their owners have been personally sanctioned by Ukraine’s partner countries in the West, these corporations themselves are not currently under sanctions, the publication points out.

Reportage by Maria Zholobova and Anastasia Korotkova for iStories. Summary by Meduza. Translated by Anna Razumnaya.