The trashcan bribe

How an ambitious software project led to Russian Deputy Energy Minister Anatoly Tikhonov’s arrest

GIS TEK, an expensive software that compiles information about Russia’s entire fuel and energy sector, was created to help fight illegal business dealings and tax evasion. Its main result so far, however, has been an embezzlement case implicating the heads of one of Russia’s largest technology companies, LANIT, along with Deputy Energy Minister Anatoly Tikhonov. Meduza technology editor Maria Kolomichenko reports on the story, which involved secretly-recorded phone conversations and reports of bribes being transferred through a trashcan in a women’s restroom.

A trashcan bribe

For Alexey Savin, advisor to the General Director of an IT company called “Communication and Security Information Systems” (ISSB), New Year’s Eve 2015 was not particularly festive. On December 28, he had asked one of his subordinates to go to “Limoncello,” a cafe located next to the Russian Energy Agency (part of the Energy Ministry) on Shchepkin street, where he was to leave a money order for 20 million rubles (about $260,000) to be transferred to the account of a company called Triton.

This money was the first half of a bribe demanded by the head of the Russian Energy Agency’s IT Directorate, Roman Scherbov. It was supposed to go to Igor Udintsev, Shcherbov’s longtime acquaintance, by means of the Triton account, which Udintsev controlled. This much is clear from documents (obtained by Meduza) from the criminal case against Scherbov and Udintsev.

Alexey Savin himself explained in his court testimony why he had to pay kickbacks to Scherbov.

In 2015, Savin’s company, ISSB, had fought for several months to secure a contract with the Russian Energy Agency to provide a data storage system for the project GIS TEK (more information about GIS TEK below). After not being allowed to compete for the contract twice over, they issued a complaint with Russia’s Federal Antimonopoly Service. After Savin issued a second complaint, a man called him and arranged a meeting to “discuss the current situation concerning the competition.” This turned out to be the same head of the Energy Agency’s IT Directorate, Roman Scherbov.

At the meeting, Scherbov explained to Savin that there was no reason for his company to participate in the competition. “Even if ISSB wins, it won’t receive the funds even in court proceedings, because they’ll do all they can to ensure that the final product provided by ISSB doesn’t meet the Energy Ministry’s technical requirements,” Scherbov and his colleagues threatened, according to Savin’s court testimony. Nonetheless, in November 2015, ISSB won the competition and signed a 70.4-million-ruble ($921,000) contract with the Russian Energy Agency. The contract required them to provide the agency with IBM equipment.

Savin had the foresight to record his further conversations with Scherbov about providing the equipment. This included, for example, a conversation in which Scherbov explained the potential benefit of purchasing cheaper equipment made by Hitachi instead of IBM. “Scherbov said that his managers objected to the use of IBM equipment due to the fact that the amount of money that needed to be transferred to them as a kickback would be substantially smaller if IBM equipment was used,” Savin claimed in his testimony.

In an attempt to support his argument with an official document, Scherbov contacted IBM three times requesting that they “prepare a letter on official letterhead stating that the company’s products don’t meet the requirements specified for the auction,” then complained when IBM refused. IBM business development specialist Vitaly Voronin spoke about this in his testimony (obtained by Meduza).

Since Scherbov was ultimately required by the contract to use IBM equipment, his next move was to suggest that Savin “reduce the cost of the contract by substituting the disk group with lower-quality hardware,” promising that there wouldn’t “be any obstacles to the product’s acceptance.” The money saved by using cheaper equipment was supposed to be transferred to Triton, the company controlled by Roman Scherbov’s longtime friend Igor Udintsev, according to court documents. To cover this up, the companies signed two agreements “for the performance of imaginary work related to commissioning and mortgaging IBM equipment.” The bribes were to add up to 40 million rubles ($518,000).

After a trial run of the IBM equipment, a Russian Energy Agency employee composed an “undated statement indicating that the equipment was not in compliance with the state contract requirements.” According to Savin, this statement was fictitious and was intended to serve as a guarantee that the bribes would be transferred from ISSB to Triton. Roman Scherbov ordered Savin to leave the money order for the first 20 million rubles ($518,000), as well as the fictitious agreements between ISSB and Triton, in a trashcan in the women’s restroom at a nearby cafe. He “made this clear” to Savin using gestures, according to Savin’s testimony.

The following day, Scherbov and Udintsev were arrested. Scherbov was accused of taking bribes (Article 290 of the Criminal Code of the Russian Federation), and Udintsev was charged with serving as an intermediary to a bribe (Article 291.1 of the Criminal Code). They partially pleaded guilty and repented, according to court documents, although Scherbov also noted that “there was provocation on Savin’s part.” In June 2017, Scherbov and Udintsev were sentenced to eight and a half years and seven and a half years in prison, respectively.

Alexey Savin acknowledged to Meduza that the story of the supply of equipment and the passing of bribes was monitored by the police, but he says he never baited anyone. It was clear from Scherbov’s behavior that the solicitation of bribes was not his personal initiative, but the “general will” (of the administration), so complaining to the Russian Energy Agency wouldn’t help, Savin said. “I contacted the police after I started getting demands to send bribes, and the police contacted the FSB [Federal Security Service] and organized a meeting with the supervising officers from the FSB’s Economy Security Services office, but ultimately the Interior Ministry took over implementation,” he told Meduza.

The attempt to serve as a supplier to the Energy Ministry didn’t just create stress for Savin; it also hurt his company financially. The Russian Energy Agency broke its contract with ISSB on the pretext of the latter providing incorrect equipment, and demanded the company return more than 71 million rubles ($920,000) — the entire contract amount, plus an additional fine. In response, ISSB attempted to dispute the termination of the contract, claiming that the statement about the equipment’s failure to meet requirements was fictitious and had been written by Russian Energy Agency employees as a means of pressuring ISSB to pay bribes.

“We supplied the Russian Energy Agency with all the necessary equipment in accordance with the contract, and we agreed with the police that, despite this, we will sign any documents that the employees of this organization produce. Their report is fabricated,” Savin told Meduza. The trial court ruled in favor of the Russian Energy Agency and required ISSB to return 47 million rubles ($609,000; according to the court, this is the amount owed minus the value of the equipment that was delivered), but the company has been disputing the ruling in various courts for the past five years.

Roman Scherbov was released on parole in late 2018. By that time, security officials had already conducted a pre-investigation review of the Russian Energy Agency’s general director, Anatoly Tikhonov, but it didn’t lead to a criminal case until several years later, after Scherbov testified against his former boss.

Three years of investigation

At the beginning of 2017, the GIS TEK system, for which Alexey Savin had wanted to provide hardware, was supposed to have been operative for a year already; in reality, it remained uncompleted. “TEK information system not put into operation on time,” read a May 2017 report published by the Russian Accounts Chamber. “The R&D contract worth 607 million rubles ($7.9 million) has not been fulfilled. The deadline was no later than September 21, 2015, or more than a year and a half ago,” read the auditors’ statement.

What is GIS TEK?

The idea to create a single data-sharing system for all state and commercial structures involved in the production, transportation, processing and sale of energy resources, originated in 2009. Then Deputy Prime Minister Igor Sechin, who oversaw Russia’s fuel and energy sector, instructed the Energy Ministry to draft legislation for the system.

The original purpose of the system was to facilitate the supervision of each barrel of oil all the way from the well to the consumer. This would help in the fight against illegal mini-oil refineries, or so-called “samovars,” as well as various other tax evasion schemes. This turned into a system that would collect all information about the oil, gas, and coal sectors, as well as information about energy conservation and efficiency.

The law regulating the system’s operation was signed by President Dmitry Medvedev in December 2011, and in 2012, the Energy Ministry was made responsible for its creation. It assigned the main tasks to its “Russian Energy Agency.” Its General Director from 2013-2019 was Anatoly Tikhonov, who later became the deputy energy minister. Roughly 968 million rubles ($12.6 million) in subsidies were allocated to the Russian Energy Agency for the development of GIS TEK, and the system was to be put into full commercial operation by the end of 2015.

The Energy Ministry began by commissioning several R&D projects, along with a detailed description of GIS TEK’s principles of operation. In July 2013, the Audit Chamber reviewed the progress made up to that point and issued a devastating report: the auditors concluded that “none of the planned activities … aimed at creating a GIS TEK complex were completed.” In addition, they found auction violations, poor quality work by contractors, and evidence of payments made for incomplete work.

The work was delayed by the Energy Ministry’s main contractor for the project, an IT company called “Lanit.” The Russian Energy Agency had signed a 607-million-ruble contract with the company in 2014, causing a storm of indignation among Lanit’s competitor companies: two other bidders unsuccessfully filed complaints with the Federal Antimonopoly Service about unfair bidding procedures. None other than Roman Scherbov chaired the committee that chose Lanit as the contractor.

In 2017, after the Russian Accounts Chamber report on GIS TEK, security officials began studying the actions of the Energy Ministry employees; according to documents obtained by Meduza, the investigation lasted three years. “At the request of the Russian Accounts Chamber, a preliminary audit of possible financial abuse during the course of expenditure on the creation of the system (GIS TEK) was conducted. Based on the review’s results, police refused repeatedly to initiate criminal proceedings, which were annulled by departmental control and by the supervising prosecutor. Final decisions on the material have not been made,” reads a letter (obtained by Meduza) written by Deputy Attorney General Yuri Ponomareva in March 2019. Tikhonov and Lanit’s vice president, Vladimir Makarov, devised a plan: they wrote the terms of reference such that Lanit would be awarded the contract, and then they overestimated the cost of the work.

The work completed by Lanit didn’t meet the requirements of the contract, and “led to the inability of GIS TEK to function properly,” according to the investigation. Leaders of the Russian Energy Agency, however, signed a certificate of completion for the work.

Meduza obtained two certificates of completion of several stages of work on GIS TEK from October and November 2015; they indicate that the work was completed and that both sides were satisfied. Both certificates are signed by the agency’s general director Anatoly Tikhonov and Lanit’s general director Igor Dubrov, though “subject to revision” is handwritten on both documents. According to the investigation, the signing of the certificates allowed Lanit to receive more than 603 million rubles ($7.8 million) for low-quality or incomplete work, and this money was later stolen by the defendants.

Money for the boss

Tikhonov and Makarov didn’t act alone; they implicated other employees of the Russian Energy Agency, Lanit, and other third-party organizations in their plot, including people involved in the previous criminal case related to GIS TEK such as Igor Udintsev and Roman Scherbov, according to the investigation. This time, Scherbov described the entire embezzlement scheme in his court testimony (obtained by Meduza).

“Tikhonov made it clear that the commercial profit made by the subcontractors under his control, which arose as a result of the fulfillment of state contracts, should be shared with a specific person, Roman Ryzhkov, who was a direct advisor to Tikhonov at that time. Or rather, as it turned out, not specifically with Ryzhkov, but with organizations he controlled. […] Part of the subcontractor’s profit was essentially a kickback,” Scherbov explained.

According to Scherbov, he introduced Ryzhkov to his longtime acquaintance Igor Udintsev in order to help him organize a criminal scheme to withdraw budget money. “Basically, I just served as a mediary and expressed Tikhonov’s will. Then I left the cafe, and they stayed to negotiate, as I understood, about the amounts and kickbacks for Tikhonov, which they got as a result of state contracts,” said Scherbov.

As far as the electronic document containing “monetary amounts, surnames, and organizations” that was seized from Igor Udintsev, Scherbov told an investigator: “I assume that this is part of the plan to distribute the funds received as a result of transactions in the form of kickbacks and other expenses. […] As I understand it, the ‘boss’ refers to Tikhonov, since that’s what everyone used to call him.”

Alexey Savin from ISSB was familiar with the document as well. “In the course of Udintsev’s arrest, he was found to have records of the division of the money stolen under the contract with another company, “Resource Service,” which contain information about who received money and how much. According to the records, 30 million rubles ($388,000) went to the ‘boss,’” Savin told Meduza.

Who is Anatoly Tikhonov?

Anatoly Tikhonov is 51 years old. After studying law at MSU, he started his civil service career in 1999, when he was appointed Deputy Chairman of the Finance Committee of the St. Petersburg city administration.

Four years later, Tikhonov became the lieutenant governor of the Krasnoyarsk Krai, where his immediate superior was influential political Alexander Khloponin. He left the Krasnoyarsk Krai in 2008 to become the first Deputy Chairman of Vnesheconombank, and, after working there for five years, got a job in the Russian Energy Ministry. He headed it until mid-2019, and then he was appointed deputy energy minister.

From 2014 to 2016, when, according to investigators, Energy Agency employees were embezzling government funds, Tikhonov’s associate Alexander Khloponin served as Deputy Prime Minister in the government. According to Company magazine, this “could have given Anatoly Tikhonov a certain immunity in those years.” As deputy energy minister, Tikhonov served on the Boards of Directors of Rosseti and Zarubezhneft, but in July 2020, when law enforcement agencies were already conducting an active preliminary audit, Tikhonov was removed from both companies.

However, according to Mikhail Bagmet, a lawyer representing Tikhonov, neither documents confirming the crime, nor documents confirming any guilt on Tikhonov’s part, were found during the course of the arrest and remand.

“The GIS TEK system functions successfully and is a hardware complex under which specialized software has been written. Assessing the value of the work that went into the creation of GIS TEK is not an easy task, since the development process was unique in many ways. During the six months of investigation that preceded the arrest of Anatoly Vladimirovich Tikhonov, the investigation did not produce any expert opinions or opinions of independent experts that would indicate that the cost of work on the development of the program was overstated,” Mikhail Bagmet told Meduza.

He’s likewise confident that Tikhonov’s arrest was not justified. “He’s being accused of economic crimes, but there have been a number of examples of defendants accused of similar crimes who have been put under house arrest, even when there’s stronger evidence of their guilt. For example, that’s what happened in the case of former Economic Minister Alexey Ulyukayev and Defense Ministry employee Evgenia Vasilyeva,” Bagmet said.

Snowballing investigations

The GIS TEK saga continued when the case against Tikhonov was combined with another case, which was opened by the Internal Affairs Ministry in March 2020 (Meduza obtained a copy of the order to initiate the case). According to the investigation, Russian Energy Agency employees used counterfeit documents to raise the price of the equipment to more than 109 million rubles ($1.4 million). Additionally, the paperwork for the auction was formulated to favor the companies “Resource Service” and “Softline Trade,” “which were used to commit theft,” according to security officials.

As a result, the equipment was delivered to the Russian Energy Agency at a deliberately inflated price, "which subsequently served as the basis for the illegal transfer of funds from the budget of the Russian Federation to the accounts of the organizations used by the offenders.”

Igor Udintsev and Roman Scherbov have already been charged with violating Part 4 of Article 159 of the Russian Criminal Code (“Fraud committed by an organized group on a large scale”), but the materials of the case also indicate the possible involvement of the people who are being investigated in the case of the contract with Lanit, including Deputy Energy Minister Anatoly Tikhonov. This is why both cases have been combined.

According to a source familiar with the investigation, there’s one more criminal case that could still be referred to the Investigative Committee and combined with the other cases against the Energy Agency employees. Since late 2018, the Interior Ministry has been investigating the actions of Energy Agency employees and two subcontractor companies, Construction Company 2000 and Remstroy, which, according to the investigation, stole more than 100 million rubles ($1.3 million) while fulfilling a state contract for renovating Energy Ministry buildings. This is mentioned in a letter from the Moscow Prosecutor’s office (Meduza obtained a copy). “The embezzlement schemes in all of these cases are practically identical, which is why it’s very likely that this was done by the exact same people,” a law enforcement officer told Meduza.

Accused once more, Roman Scherbov could not comment on the situation, citing a non-disclosure agreement. The Energy Ministry and the Investigative Committee also did not respond to Medusa's requests for comment.

The GIS TEK IT system, originally intended to start working at the end of 2015, was finally put into commercial operation in October 2019. Shortly before that, Anatoly Tikhonov, the Director of the Russian Energy Agency that created GIS TEK, was appointed Deputy Energy Minister.

Story by Maria Kolomychenko

Translation by Sam Breazeale