Debt hole

Another criminal case was opened against Deputy Finance Minister Sergei Storchak

The Investigative Committee of the Prosecutor's Office (SKP) of the Russian Federation opened a new criminal case against Deputy Minister of Finance of Russia Sergei Storchak, who was arrested in mid-November on charges of attempting to steal $43 million from the state budget. The official was suspected, in addition to the previous charge, of abuse of power . This turned out to be completely unexpected yesterday in the Moscow City Court during a meeting at which the issue of the legality of Mr. Storchak’s arrest was considered. The prosecution representative cited this news as another argument in favor of the need to keep the deputy minister in custody.

The Moscow City Court confirmed the legality of Mr. Storchak’s arrest, which, by and large, was not a surprise, although the head of the Ministry of Finance, Deputy Prime Minister Alexei Kudrin, was ready to personally vouch for his subordinate. When it comes to suspicions against figures of such high rank, the Russian judicial and law enforcement authorities, ever since the “YUKOS case,” almost never change their opinion. The news of a new criminal case against Mr. Storchak, on the contrary, only increased the intrigue surrounding his arrest, which observers regard as an intensification of the political struggle between pro-government groups. It was not just another blow to the reputation of the Ministry of Finance and Mr. Kudrin. Taking into account some details of the new claims against Mr. Storchak announced yesterday, it can be assumed that the investigation may have questions for the head of the Ministry of Finance himself.

As it turned out, the UPC believes that Mr. Storchak exceeded his authority during negotiations to settle the debt of the former USSR to Kuwait. The corresponding agreements were signed by Mr. Kudrin personally a year and a half ago, and then he called the agreements reached “wonderful” (in the sense of benefits for Russia). True, at the same time, statements by some observers appeared in the media, claiming that the Ministry of Finance in that situation, on the contrary, did not work effectively, since, according to them, the Kuwaiti side was allegedly ready to write off the debt (and we were talking about more than a billion dollars).

The first criminal case - on the fact of attempted fraud - against Mr. Storchak, who is considered the leading Russian negotiator with foreign and international representatives on the settlement of state external debt, was opened by the SKP on November 9. On November 15, the Basmanny District Court of the capital issued a warrant for his arrest. The president and chairman of the board of directors of CJSC JSCB Interregional Investment Bank (IIB), Vadim Volkov (formerly also Deputy Minister of Finance) and the general director of the capital's CJSC Sodexim, Viktor Zakharov, also went to prison. They were charged with attempting to steal $43 million from the state budget under the guise of covering costs incurred by Sodexim. The SKP decided that Mr. Storchak and two businessmen created a criminal group, and only the arrest prevented them from stealing money.

The Ministry of Finance literally stood on its hind legs at this news. They immediately commented on the detention of their employee as illegal and unfounded, noting: everything that Mr. Storchak has ever done, including the agreement to compensate Sodexim for the costs incurred, was sanctioned by the government and was approved not only financially, but also many other departments.

As the Ministry of Finance explained, investigators considered the agreement on the return to Sodexim of the collateral that it contributed to the budget many years ago to participate in transactions to return the Algerian debt to Russia an attempted theft. These transactions never took place due to the fault of the Algerian side, and since then the company has been trying to return its $26 million (taking into account interest it turned out to be $43 million). In 2006, Russia wrote off the Algerian debt , and after lengthy negotiations, the Ministry of Finance agreed to return the money to Sodexim.

Deputy Prime Minister and Minister of Finance Alexei Kudrin ruled out the possibility of Mr. Stochrak’s participation in thefts, and then at a briefing in the government he announced that he intended to petition the investigation to change the preventive measure against him under his personal guarantee. The minister also stated that he urgently needed to get a meeting with the prisoner, otherwise negotiations with several states on settling payments on external debts would be in jeopardy.

Sergei Storchak asked for his personal presence at yesterday’s meeting of the Moscow City Court, but the court decided that his participation through video conferencing with the Lefortovo pre-trial detention center would be sufficient.

The official's defense yesterday once again presented the court with a copy of Mr. Kudrin's letter, in which he insisted on a meeting with his subordinate and drew attention to the need for the defendant's personal participation in negotiation processes "significant for the social, political and economic life of the country." “Mr. Storchak plays a significant role in international negotiations. Keeping him in custody has a negative impact on the economy, and some negotiations have already been postponed,” said lawyer Igor Pastukhov. The lawyers also noted that when making the arrest, the Basmanny court did not take into account that their client suffers from heart disease, that all of his trips abroad were exclusively business, and the investigation did not provide any evidence of his possible escape. In addition, the defenders recalled Mr. Storchak’s numerous awards, including the Order of Friendship, the Medal for Services to the Fatherland, II degree, and personal gratitude from President Putin, issued in 2005, for his work in settling the payments of foreign debts.

The accused himself made a speech from the TV screen. “I understand that there is a difficult decision to be made,” Mr. Storchak said. - I consider the preventive measure imposed on me to be excessive. I am ready to cooperate with the investigation at any time and anywhere. In my position, I could not make either positive or negative decisions regarding the federal budget. These are the functions of the government, and the Ministry of Finance prepares calculations and justifications. All our work was carried out openly. Neither I nor my colleagues ever went beyond the legal framework. I did not damage either the state or the federal budget. And the preventive measure I have chosen leads to additional costs for our taxpayers. We were at the stage of deciding on long-term repayment of external debt to the Republic of Korea and the World Bank. Delays in decision-making mean additional costs for the federal budget, interest payments to the World Bank and Korea.” At the same time, according to the official, Russia’s external debt to the World Bank exceeds $3 billion, and to Korea - 1 billion.

Lawyer Alexander Petrov called the investigation’s argument that his client, being free, could destroy evidence and thus impede the investigation, groundless. “There were no obstacles to simply removing Storchak from office, and then he would not have access to official documents,” the lawyer said.

Representatives of the investigation, in turn, insisted that the decision of the Basmanny Court to arrest was made correctly. And they repeated their arguments: if free, Storchak would certainly run away, begin to put pressure on witnesses, taking advantage of his high position and connections, or in some other way interfere with the investigation and trial. SKP investigator Valery Khomitsky also presented the court with a medical certificate, according to which Mr. Storchak is quite capable of withstanding both imprisonment and participation in investigative actions. Then a representative of the Prosecutor General's Office spoke, who practically lulled those present with an endless list of the same reasons for the arrest. But suddenly she stirred up the audience with an unexpected statement: “Regarding the arguments that the defense expressed regarding Storchak’s personality, I want to note that he is accused of committing a crime that is related to his official activities. “I want to say that another criminal case has been opened against him.”

Investigator Khomitsky explained that the case was opened under Article 286 of the Criminal Code - abuse of official powers. Everyone immediately started making noise. The lawyers were perplexed - they knew nothing about their client’s new case. “Apparently, they deliberately held this idea until the meeting of the Moscow City Court,” lawyer Igor Pastukhov later expressed his assumption. “The investigator says he sent us a notification, but we haven’t received anything yet.” According to the lawyer, if a criminal case is initiated, the suspect is required to be interrogated within three days, and since interrogation is impossible without the participation of lawyers, it means that their client has not yet been interrogated in the new case.

Some clarity regarding “another criminal case” appeared only in the evening. UPC representative Vladimir Markin said that the case “is related to the abuse of power by the head of the Russian delegation, Storchak, during Russian-Kuwaiti negotiations to settle the debt of the former USSR to the state of Kuwait, held on January 27-28, 2005 in Moscow.” As reported in the UPC press release, in 1991 Kuwait provided the USSR with a loan of $1.1 billion for 7 years with a grace period of 48 months, but it was not returned on time. Only on May 30, 2006, Russia and Kuwait signed an agreement to repay the debt. According to it, our country must return only $1.1 billion in “real” money, and another 600 million will be repaid with machine and technical products. Commenting on the agreement, Mr. Kudrin then noted that in fact Russia managed to save almost half a billion dollars in penalty interest that had accrued over the eight-year delay in repaying the debt. How exactly Mr. Storchak could exceed his powers, especially since he did not make final decisions (this was within the competence of Mr. Kudrin and the government), the UPC did not explain. However, after the signing of the agreement on the Kuwaiti debt, accusations were made in the media against the Ministry of Finance, the essence of which boiled down to the following: since Kuwait gave the USSR a loan for purely political reasons in the run-up to Operation Desert Storm, the authorities of this country allegedly did not expect to return the money, and They almost themselves offered to write off this debt to Russia later. And the Ministry of Finance, they say, almost by force forced Kuwait to take the money back. It is possible that now investigators may want to ask questions to Mr. Kudrin himself, who signed that agreement.

Yesterday, the SKP reported that both criminal cases against Mr. Storchak have already been combined into one proceeding.

Ekaterina BUTORINA, Victor PAUKOV