Category Archives: Crime and Corruption

Dizzy with Success

On Topwar.ru on 15 September, Aleksandr Staver and Roman Skomorokhov asked whether President Vladimir Putin, like his predecessor Stalin, has decided to curb (at least temporarily) his key program.  Today it’s rearmament rather than collectivization.

The authors assess the program and its problems from a conservative viewpoint.

They assert the arms program is not being fulfilled and the MOD budget is being cut (whether admitted or not).  In particular, they contend, it is new weapons programs that are suffering, so they argue for cheaper modernization of existing armaments.

Debate over rearmament is a constant.  Staver and Skomorokhov don’t even mention that the start of the next arms program was delayed, or that the MOD and Finance Ministry are far apart on funding it.

For his part, Putin routinely says the current GPV will not be cut, and the armed forces will have 70 percent modern arms and equipment in 2020.

But 70 percent, according to the authors of this op-ed, is not enough.  More is needed.

Then they turn to corruption.  They allege that the ones who are “dizzy with the success” of the arms program are the ones who are stealing from it.  They say a return to 1937 would put an end to this, and to other problems with rearmament.

Recall that even Putin and United Russia once talked about bringing treason charges for non-fulfillment of the GOZ, but nothing came of it.

So much for preamble.

“Dizzy with Success, or ‘Alarm’ in the Russian Army”

“We are so used to the fact that our army is powerful that we almost don’t notice, or more precisely, don’t wish to notice that light ‘clouds’ threatening to turn into bad storms have appeared over Russia’s VS [Armed Forces].  We talk and write with satisfaction about our aircraft which, at a minimum, don’t lag behind Western ones. We ‘procrastinate’ with Armata and its offshoots, comparing it to the best models of Western armies.  We discuss the advantages of our new missiles and systems.”

“And now, today exactly, heard here and there are announcements by various government bureaucrats and army chiefs about delaying arms procurement to another time, so to speak.  About delayed launches of ships.  About adjusting the schedule for delivering something to the troops.”

“So what’s with this.  Why is this happening?  Recently all officials, including the president and the prime minister, together talked about fulfilling the defense order almost as a matter of honor for Russia. Don’t many remember Putin’s April statement about the unconditional fulfillment of the state defense order?  And can’t many say exactly how much it is fulfilled and whether it is fulfilled?”

“The entire thing is that the necessary money is not in the budget!  The crisis, which we are ‘successfully overcoming,’ still has us in its claws.  We’ve talked a lot about the fact that sanctions hurt Europe and the USA, and how they [sanctions] are going to benefit us.  We are developing, increasing output, winning markets…  On any analytical program on our TV it’s possible to hear a full assortment of such pronouncements.”

“The support of the president and the real successes of our servicemen in Syria inspire hope in us that all this will come true.  The government will find money both for us and for the army.  Industry will begin to work not only well, but both quickly and cheaply.  New ideas of [arms] designers will be realized in the shortest time.”

“Prime Minister Medvedev’s decision, signed on 5 September, to adjust the GOZ for 2016 was only the first call.  It is understood that today there’s no clear data on this question.  Naturally, it’s possible to suppose that defense sector enterprises won’t receive some part of the promised resources.  And this, in its turn, means that GOZ plans for next year will be ruined.  A snowball of corrections will accumulate gradually from the details.”

“And not hiding the fact, by the way, does him credit, Putin himself already talks about the fact that by 2018 our army will be rearmed at 70%, and the state order will be reduced.  And he talks about what is needed to take the place of the defense order, but not pots and pans.”

“From the one side, one who is forewarned is forearmed.  But from the other?  It’s hard to guess with what enterprises will be occupied, with a miracle which drags them out of the debt hole.  And where will workers who turn out to be redundant go at this moment?  But we have already passed through such a scenario.”

“However, certain specifics have already ‘hatched.’ The Ministry of Defense plans to make the famous “Armata” the main battle tank by 2020.  With this aim, the purchase of more than 2,000 of such vehicles for military units has been proposed. According to the tank producer’s data, the order was already for 2,300 tanks.  But not long ago on the Ministry of Defense website an altogether different figure appeared: there is a plan to buy up to 70 “Armatas” in 2017-2019.”

“Naturally, the reasons for changing the [state defense] order aren’t named.  I think over some time versions about some shortcomings, about the modernization of what we already have, [and] some others.  Actually, the reason is banal.  They are cutting the military budget and will cut it.  It’s completely logical, you can’t take money from the shelf if there’s nothing on it.  So folks say.”

“The navy’s situation looks even more confused.  Even the blind see the necessity for modernizing the Russian fleet.  Ships, just like people, age, lose their striking power, and turn into respected veterans.  But we need warriors.  And these ‘warriors’ need to be built.  A lot of them.  The Soviet legacy can no longer guarantee a worthy answer to an aggressor.”

“It seems as though construction began from 2007.  Missile boats, small ships and even submarines began to leave the docks for testing.  New submarines, frigates were laid down at the wharves.  The rebirth had begun.”

“Our excessive belief in the ‘love and friendship of fraternal peoples’ became the first ‘obstacle.’  When construction was stopped by the Ukrainian side [sic].  They stopped supplying Ukrainian engines to us.  Actually, the question of ‘their’ components in combat equipment and armaments arose already in the last century.  And they successfully solved it in the USSR.  But in Russia they put it off ‘for later.'”

“Then the ‘rockslide’ of announcements by military and government bureaucrats on cutbacks in the needs of the fleet began.  I remind the readers about the project 11711 BDK [i.e. an LST].  A large assault ship which was needed to replace Soviet BDKs.  In 2004, a requirement for 6 of such ships for the navy was announced.  Then they decided to review the project.”

“Today we see two ships.  Two instead of six.  It’s been decided to shut down the project.  ‘Ivan Gren’ and ‘Petr Morgunov’ — that’s all that the fleet will receive after testing.”

“It’s possible to talk endlessly about the submarine fleet.  About new missile submarines.  But even they, alas, for the most part remain only projects.  The construction of boats of such a class is a very expensive undertaking.  And this means still unmanageable.”

“Even the Rocket Troops of Strategic Designation [RVSN] will not receive everything promised.  Although, for all times the priority was always right on these troops.  No, ‘Yars’ and similar systems will be supplied.  But land-based ‘Sarmat’ systems most probably won’t be deployed to the original plan.”

“I recall it was planned to replace by 2020 the already aged ‘Voyevod’ missiles (known to most by the NATO ‘nickname’ ‘Satan’) which have served out their time.  Today it’s understood that these plans aren’t being fulfilled.  Today already.  In the best case, such a replacement will occur in 2021.  Or a little later.”

“So where’s the way out of the situation which has been created?  Is there one generally?  I believe there is.  And today the way out is to use those developments which exist and have already been tested in combat.”

“When the VDV [Airborne Troops] commander announced the establishment of tank and BMP companies in units subordinate to him, what kind of vehicles did he mention?  He talked about T-72B3 tanks and BMP-2s.  I hope no one will chide General Shamanov for stupidity and a lack of desire to have the most powerful and modern weaponry?  So why exactly these vehicles?”

“Simply because both the tank and the combat vehicle have huge modernization potential.  And in the coming decades this potential will be used.  And mass serial production has reduced the cost of this equipment in the extreme.  And long use in the troops has revealed practically all ‘minuses’ of these vehicles.”

“Modernization of the T-72 to the T-72B3 level costs a bit more than 50 million rubles.  In other words, for one ‘Armata’ we can have several T-72B3s right away.   Naturally, the T-90 would be more desirable, but it is cost prohibitive.”

“It’s exactly the same situation with the famous T-50 system.  The aircraft is ready. Moreover, it’s been put in series production.  And in the plans it’s supposed to be the main fighter.  This ‘hulk’ looks impressive in our plans.  In 2020 we should already have 60 fighters in the force.  And in the future their production should increase.”

“In reality we’ll get exactly the same as ‘Armata.’  We want to do a ‘split,’ but our britches get in the way…  It will be good if we have a regiment of such aircraft in 2020.”

“But we have the fully combat capable, even compared to the American F-22 and F-35, Su-30MK.  And, according to the assertions of its builders, the potential of these aircraft is far from used up.”

“And what’s the result?  As a result, we see the famous ‘half-full glass.’  Part of the readers are now sighing sadly.  The army is ‘penned up.’  Another part thinks that the Russian Army, in the shape which we have it, can really confront the enemy.  The third part giggles happily.  They have failed to modernize.  Oafs.  We told them…”

“It’s not for nothing that I called this article by a Stalinist name.  This isn’t a greatness mania or a wish to show off knowledge of the works of the ‘leader of peoples.’  We truly have become a little ‘dizzy.’  Not everything has succeeded right away.”

“I generally believe that the right way to move is walking or running.  But not ‘leapfrog’ jumps.  Movement should be measured and in one direction.  Therefore, the modernization of the army should continue.  Continue, no matter what.  But not by busting a gut.”

“I would be wary of talking about our weapons and combat equipment like junk.  Particularly after what this equipment showed in Syrian battles.  Just the same to talk also about the superiority of Western armies in some components.  But if we view the army like the world, a ‘gap’ will always be found.  But this gap is always ‘plugged’ by something else.”

“The dizziness quickly passes if you leave the centrifuge or wheel.  If, of course, you have a properly functioning outer office staff.  I think healthy people serve in our Ministry of Defense.”

“But just one moment.  No one needs to have the fact that our bureaucrats are not simply greedily stealing everything possible explained to them.  It’s a rare day when the Internet and television don’t report about the latest stuff that’s ‘flown off.'”

“It’s necessary to stop those who ‘have become dizzy with success.’  With the methods of the person I quoted.  Severe and long-term.  Take that Zakharchenko.  9 billion rubles — that’s a great deal.  The T-90, for example, today costs about 120 million rubles.  That is 75 tanks laid in the brute’s hidey-holes.  Two battalions.  Not bad…”

“And this is one of the deputies…”

[Colonel Dmitriy Zakharchenko is, or was, deputy chief of Directorate T in the MVD’s Main Directorate of Economic Security and Countering Corruption until his arrest in early September.  The foreign currency equivalent of 8 billion rubles was found in his apartment.  See RIA Novosti for an early report on his case.]

“And if they search his relatives, it’s certain it would be possible to scrape together a brigade easily and without effort.”

“‘Effective managers’ of our times have shown that they can only steal effectively.  From the budget just the same as from the GOZ.”

“It’s necessary to change the situation really at the root.  And tear this root with a crunch and snap on the image and likeness of ’37.  With the confiscation of everything that’s possible.”

“Only then will the state defense order be fulfilled on time and without problems.  And the president won’t have to shuffle, talking about how 70 percent is sufficient so we should relax.”

“So isn’t it?”

Some MPs Fail First Test

Denis Mokrushin pointed out an interesting item from Lifenews.ru about new military police recruits in the Urals who recently paid 3,000-ruble [$45] bribes to their company commander.

Aleksandr Tsoy

Aleksandr Tsoy

32-year-old Captain Aleksandr Tsoy reportedly demanded 3,000 rubles from each of the 112 recruits under his command for retraining as MPs.  In exchange, Tsoy promised good living conditions, but he also threatened them with failing the training if they didn’t pay.  He certainly helped them fail their first test in any event.  In all, 106 paid the young officer a total of 318,000 rubles [$4,700] — the equivalent of several months pay for him.

Tsoy was relieved of duty during the investigation.

It’s interesting and inauspicious that only six trainees refused to pay. The Russian military should be worried that Tsoy apparently didn’t think he’d get caught.

Serdyukov Suspected

Anatoliy Serdyukov’s no longer a witness; he’s a suspect.

The Investigative Committee of Russia (SKR) suspects the former defense minister of negligence leading to the loss of more than 56 million rubles.  He reportedly gave verbal orders to use budget money to finance a road to the Zhitnoye resort in Astrakhan Oblast, and to have railroad troops build it.  Soldiers were also reportedly employed in landscaping Zhitnoye, owned by Serdyukov’s brother-in-law Valeriy Puzikov.

Putin and Medvedev at Zhitnoye in 2011 (photo: Press-Service of the President of Russia)

Putin and Medvedev at Zhitnoye in 2011 (photo: Press-Service of the President of Russia)

Serdyukov will appear on 3 December for questioning under Part 1, Article 293 of the RF Criminal Code, which reads:

“1.  Negligence, that is the non-fulfillment or unreliable fulfillment of his obligations by a responsible person as a result of an unconscientious or negligent attitude toward service, if this inflicts a great loss or material damage to the rights and legal interests of citizens or organizations or interests of society or the state protected by the law, -”

“Punishable by a fine in an amount up to one hundred twenty thousand rubles or in the amount of wages or other proceeds of the guilty party for a one year period, or mandatory work for a period up to three hundred sixty hours, or correctional labor for the period of one year, or arrest for a period up to three months.”

A command “from above” to pursue Serdyukov was required, and, apparently, it’s been given.

According to ITAR-TASS, SKR spokesman Vladimir Markin says a “final evaluation” of Serdyukov’s “illegal activity” will be made during the investigation.

Some observers believe, at a minimum, Serdyukov’s orders look like a more serious charge of “misuse of official authority” (Article 285).  But, as Nezavisimaya gazeta writes, most doubt prosecutors will lay a heavier accusation on Serdyukov.

Political commentator Gleb Pavlovskiy says making Serdyukov a suspect raises the bar for the next targets of anti-corruption investigations, but Pavlovskiy doesn’t think he’ll receive any real sentence:

“As regards Serdyukov, apparently, there’s a point of view that he must be punished somehow, but he mustn’t suffer because he was a politically loyal functionary.  The new accusation proceeds from the idea that Serdyukov is guilty for not preventing the growth of MOD corruption to a scandalous proportion, but he’s not guilty himself.”

Similarly, politician and analyst Vladimir Ryzhkov suggests a nominal conviction and sentence of community service hours might satisfy public opinion, and give President Putin an acceptable exit from a thorny problem.

Observer Igor Bunin adds:

“. . . Putin, when he decided it was necessary to sort things out with Serdyukov, followed two goals.  From one side, make the elite understand that it’s forbidden to cross certain lines, and from the other side — raise his own prestige.  But at the same time he understood that he depends on this elite, and it’s impossible to punish this once close person severely, he was in the very tight-knit group connected to Putin.”

Political scientist Pavel Salin, however, thinks Serdyukov’s fate may be the object of struggle between “hardliners” and moderates.  No longer satisfied with Putin as arbiter of the political system, “hardliners” want a conviction, while moderates want to limit blowback on the elite and the status quo, and to confine anti-corruption measures to lower levels.

Ryzhkov also wonders if something along these lines is changing:

“It seems Putin himself wants to toughen something up.  At least the simultaneous start of the criminal case against Serdyukov and the announcement of creation of the Kremlin’s agency for battling corruption [PA anti-corruption directorate] shows that, possibly, they are really at least trying something to toughen the struggle against corruption.”

Zhitnoye in 2011 (photo: Press-Service of the President of Russia)

Zhitnoye in 2011 (photo: Press-Service of the President of Russia)

Speaking for his client, Serdyukov’s lawyer said he hasn’t been charged, and acknowledging any kind of guilt is “out of the question.”  Until now, he was a witness to property machinations involving Oboronservis and Slavyanka that occurred during his tenure as defense minister.

Just back on 15 November Serdyukov was named head of Rostekh’s obscure Federal Testing Research Center for Machinebuilding.

Long Road from Witness to Accused

Serdyukov in a Contemplative Moment

Serdyukov in a Contemplative Moment

It’s time to update the legal situation of former Defense Minister, military reformer, and “witness” to enormous corruption right under his nose, Anatoliy Serdyukov.

On these pages, it’s been said there’s no way Serdyukov can escape the prosecutors and jail.  That assessment may have been hasty. 

It reflects a vain hope that even Russia, with it’s unbelievable corruption and light regard for the rule of law, will indict and convict someone too smart and too financially savvy not to know what his “women’s battalion” was doing with MOD property and shares in the quasi-military companies of Oboronservis.

Someone who clearly knew how various schemes involving his brother-in-law and military property would look if unearthed.

In Vladimir Putin’s Russia, politics and clan membership trumps law and everything else.  Serdyukov betrayed one of his benefactors by jilting his wife, Viktor Zubkov’s daughter, but remains free.  It must be Putin’s political calculation that keeps him out of prison.

Still, Serdyukov hasn’t been a cooperative witness; he’s practically been a suspect if we take the tone of what GVSU SKR investigators have told the media.

Last week Kommersant reviewed the facts regarding Serdyukov in an article on the GVSU SKR’s decision to prolong its investigation surrounding Zhitnoye until January 17.

The Oboronservis corruption investigations swirl around Serdyukov, but haven’t been directly connected to him.  They will continue until March.

The Zhitnoye case bears the most direct involvement by Serdyukov, according to Kommersant.  The paper believes it’s still fully possible he could turn from witness to accused in this case.

Zhitnoye in Winter

Zhitnoye in Winter

The affair might have ended in September when Serdyukov’s brother-in-law Valeriy Puzikov and one of his partners returned this property worth 150 million rubles to two “autonomous departments” of the MOD.  The MOD would have thus suffered no injury.  But investigators in the case argued Zhitnoye didn’t go directly back to the MOD whose budget paid for improvements at the Volga resort.  Road and bridge construction and landscaping at Zhitnoye cost the MOD 15.5 million rubles.

Serdyukov's Brother-in-Law Valeriy Puzikov

Serdyukov’s Brother-in-Law Valeriy Puzikov

Puzikov fled Russia in February, so we may never hear what he would say if questioned.

GVSU investigators say Serdyukov’s former deputies and his other underlings say he personally supervised work on Zhitnoye, but the GVSU’s case is still directed against “unidentified MOD officials.”  Serdyukov signed paperwork about Zhitnoye, and visited 17 times, but doesn’t recall other circumstances about the property, so he remains a witness.

On Serdyukov’s personal involvement, Kommersant writes:

“That fact is obvious because the beneficiary of the former official’s [Serdyukov’s] malfeasance was his close relative Valeriy Puzikov.”

“So it’s early to say that Anatoliy Serdyukov is no longer of interest in the military investigation. Moreover, sources close to the investigation led us to believe that evidence gathered on the case could completely influence a change in the ex-minister’s procedural status.  However, a political decision is required for this.”

For his part, Serdyukov’s lawyer says the MOD suffered no damages, and he calls the entire investigation a waste of time and resources.

The other two “Serdyukov dacha” cases weren’t mentioned in this latest round of news.

However, Rossiyskaya gazeta wrote last week about a St. Petersburg property that reportedly long interested Serdyukov — the gardener’s house on the grounds of the Tauride Palace.  Apparently, unknown persons acquired it for the MOD in 2008, then it was sold by Yevgeniya Vasilyeva’s people to a shadowy firm formed just months earlier for 384 million rubles.  There is suspicion the buyer was under Puzikov’s control.

Gardener's House on Grounds of Tauride Palace (photo: Kommersant / Sergey Semenov)

Gardener’s House on Grounds of Tauride Palace (photo: Kommersant / Sergey Semenov)

Izvestiya reported that “power” ministry representatives (i.e. primarily of course the SKR) were called to the PA and ordered to stop broadcasting PR about investigations like those involving Serdyukov and Oboronservis, “which don’t have a chance of being cracked.”

The paper’s source in the PA said unwinding these scandals creates a “negative image” of the authorities in the public’s mind.  This official continued:

“While high-profile corruption cases will not be brought to court, they shouldn’t be so zealously publicized in the media.  No one has yet been punished, investigative actions go on, and the common man is already getting an impression about the impunity of criminals and powerlessness of the law enforcement organs.”

This conversation was conducted, first and foremost (but not exclusively), about Oboronservis, although not Serdyukov by name.

Another PA source said siloviki shouldn’t “air” criminal cases featuring highly-placed officials and serious damage to the nation’s budget.

Commenting on the Oboronservis scandals, MGU criminal law professor Vladimir Kommissarov describes not just criminal conspiracies but an entire “organized community” of corruption:

“There are surely forces not interested in the development of this criminal case — any criminal case of such a scale can attract other criminal cases.  It’s possible for one person to steal a million, but when we talk about dozens and hundreds of millions, then obviously not simply an organized group is at work, but an organized community.”

Izvestiya concludes that the state’s anti-corruption policy [such as it is] is based on the inevitability of punishment for offenders.  And this is what law enforcement is demanding from the PA.  Correspondingly, it should be possible to expect that all big corruption cases could end with real terms for all suspects.

But Serdyukov remains at most a suspect.  Perhaps investigators are starting to close in on him.  He didn’t really talk to them until March when confronted with property documents he had signed.

It still appears Serdyukov’s fate is controlled at the highest level.  Putin apparently told SKR chief Aleksandr Bastrykin early on that he didn’t want to send the former Defense Minister to jail.  But investigators are pressing forward.  If they change Serdyukov’s status from witness to accused, then perhaps Putin isn’t the complete master of this game.

Serdyukov Speaks to Investigators

Former Defense Minister Serdyukov apparently decided to speak to investigators last week, shifting his previous stance of taking the 51st or providing written statements.  Media outlets said the appearance of “new materials” caused the change in his tactics.

Last Monday, Newsru.com recapped a Kommersant story saying that Serdyukov’s signature was on documents transferring the Bolshoy Utrish property to his brother-in-law Valeriy Puzikov.  But investigators haven’t talked to the ex-minister about that case yet, which they say amounts to large-scale fraud by a group of conspirators.

Recall the Defense Ministry obtained this Black Sea coastal property near Anapa in 2010 to build a radar station, but, with the help of Yekaterina Smetanova, it was excessed for two-thirds of the military’s purchase price to Puzikov. 

According to Newsru.com from Tuesday, Serdyukov was called to the GVSU SKR to meet with investigators about the Zhitnoye dacha.  ITAR-TASS said he provided 11 pages of evidence, and claimed the Defense Ministry participated in this civilian project out of military “necessity.”

On Wednesday, Politkom.ru commentator Tatyana Stanovaya reported that the ex-Defense Minister talked to investigators for five hours.

She believes Putin doesn’t want Serdyukov to sit in jail, and anonymous media sources say he told SKR chief Aleksandr Bastrykin as much early on.  She sees it like this:

“It’s important for Putin to sort out the corruption cases, to intimidate the elite, but generally not to get worn out with real purges.  He recognizes corruption as an evil, but an unbeatable evil which is part of Russia’s historical tradition.  In other words, for Putin thievery is an insufficient basis for ‘sitting’ given the political loyalty of the ‘figure.'”

Bastrykin notwithstanding, the siloviki think they long since had enough evidence for Serdyukov’s prosecution. 

Stanovaya cites Kommersant’s report that the former minister decided to cooperate, to talk, because investigators recently conducted searches and seized documents on the case from his relatives.  The commentator believes his more constructive position improves his chances of escaping the affair without criminal charges.

If the existing affair of the three dachas weren’t enough, Nezavisimaya gazeta unearthed another issue last week.

In the deal to import light armored vehicles from the Italian firm IVECO, Serdyukov’s Defense Ministry allegedly conspired to avoid paying customs duties amounting to $10 million.  All for vehicles of questionable suitability for Russian conditions.  NG concludes charges will be brought against the Oboronservis officials involved in the purchase.   

The paper wonders out loud if Serdyukov will play a part in the regime’s anti-corruption campaign (such as it is): 

“A critical mass of dissatisfaction is accumulating.  The country’s leadership is turning into a hostage of its own effort to reprove part of the confused elite in this way.  Citizens have learned too much about the life of high officialdom so it’s possible the ‘valve could turn’ at any moment.  It’s possible for this besides the usual cosmetic means of a party-political character a serious sacrificial victim is required — if the process of disclosures goes far enough.  It’s possible that now some backstage casting for the role of such a victim is going on.”

Izvestiya provided details on Serdyukov’s personal involvement in building Puzikov’s resort on Zhitnoye, where he claimed officers could stay (but not for free) after air defense exercises at Ashuluk.  The former Defense Minister traveled to the site 17 times between 2010 and 2012, while the road construction and landscaping was in progress, on Air Forces helicopters leased to Chkalov Avia.  That company’s majority owner is Anna Tretyakova, and her mother Yelena is general director of Zhitnoye.

Former General Staff Chief Makarov reportedly told investigators he ordered railroad troops (v/ch 42677) to build the 6.7-kilometer road and three bridges on Serdyukov’s personal order.  The construction materials came from that unit. 
 
A law enforcement source told the paper Puzikov and Serdyukov didn’t miss a trick: 
 
“First they built themselves a dacha at government expense, and then they wanted to rent out the very same — also at government expense.”

Moskovskiy komsomolets concludes Serdyukov’s assertion that Zhitnoye would serve the needs of servicemen would be funny if it weren’t so sad.  Then:

“So, as ‘MK’ has already written, Serdyukov must sit.  Otherwise Vladimir Putin can’t prove to 140 million Russian citizens that he is as before master of the situation.”

On balance, it seems prosecutors are closing on Serdyukov.  As written here in November, there’s too much blood in the water.  Putin will sacrifice him.  His effort to rebalance the political system he created depends on more than not letting the siloviki have Serdyukov.

And what of Serdyukov-instituted reforms which promised to change still largely Soviet Armed Forces into a more modern military?  The pain of reforms joined with the taint of high-level corruption to undermine them.  Their opponents could not possibly devise a more ingenious strategy to discredit them.  That too would be funny if it weren’t so sad.

If That Was Cosmic . . .

If 2011’s corruption figures for the armed forces were cosmic, what are 2012’s?

We usually get various prosecutors’ reports about this time.  This year’s no different.

Newsru.com picked up some of Main Military Prosecutor Sergey Fridinskiy’s comments on military corruption from the GVP’s web site.

The biggest issue, of course, is Oboronservis, 25 related criminal cases, and more than five billion rubles in damages to the state.  But those future facts and figures don’t play into Fridinskiy’s 2012 report.

In 2012, Fridinskiy said crimes by officers, as a share of the armed forces total, reached their highest level in 10 years — 30 percent.  The share of crimes by contract servicemen increased by 14 percent.

The overwhelming motive, said Fridinskiy, was greed, and losses to the state tripled to 11 billion rubles.

According to GVP data, every fifth crime involved corruption.  Losses from corruption exceeded seven billion rubles.  Bribery cases rose by a third.  Embezzlement and misappropriation by two times.  And fraud by almost 20 percent.

Three higher [general] officers and 210 senior officers, including 64 military unit commanders and chiefs of various facilities, were convicted of corruption-related offenses.

It’s All Relative (Part II)

Regret the delay in returning to the rest of this summary of the Oboronservis scandal from Newsru.com.

“The ‘Oboronservis’ Affair:  Figures and Episodes”

“Despite, more precisely, thanks to his unconstructive, in the SKR’s opinion, silence, Serdyukov continues to keep his witness status in the ‘Oboronservis’ affair.  At present the number of accused has reached eight.  And the charge of particularly large-scale fraud has been leveled at the former head of OAO ‘Oboronservis’ Vasilyeva (the restraint measure is house arrest), Smetanova (personal recognizance) and Zakutaylo (arrest).  Smetanova is also implicated in commercial bribery as a result of investigation of activity which the ‘Oboronservis’ affair initiated.”

“Another branch of the anticorruption investigation concerns OAO ‘Slavyanka’ and ZAO ‘Security and Communications.’  The three affairs, united into one case, arose over falsely signed statements of completed construction and cleaning work on Kolymazhnyy Lane, the Military Academy of the General Staff and a number of other facilities.  As of today in this affair the charge of particularly large-scale fraud has been leveled at five:  former general director of ‘Slavyanka’ and ‘Security’ founder Aleksandr Yelkin; Andrey Luganskiy, who has been general director of ‘Security’ since April 2011; ‘Security’ head bookkeeper Yuliya Rotanova.  And also Nikolay Ryabykh and Konstantin Lapshin — former acting chief of the Defense Ministry’s administrative directorate and chief of ‘Slavyanka’s’ repair department.  All of them are under arrest.”

“The largest part of criminal cases in ‘Oboronservis’ concerns the disposition of several pieces of property.  They are the complex of buildings ‘31st State Planning Institute of Special Construction’ and the ‘Main Directorate of Troop Installations,’ the hotel ‘Soyuz’ and the premises of OAO ‘Mosvoyentorg’ on the Arbat, buildings in the working-class village Bolshiye Vyazemy in Moscow Oblast, land plots in St. Petersburg.  Part of the matters arose over the facts of theft of money upon the conclusion of contracts with ‘Expert’ Smetanova, for example, in the sale of shares in Moscow-based ‘Central Experimental Production Combine’ and stakes in ООО ‘436th Non-Metallic Minerals Combine’ in Leningrad Oblast.”

“‘Thanks to timely intervention we succeeded in preventing the illegal, in our view, disposition of the building of the directorate of trade of the Moscow Military District on Bolshaya Serpukhovskaya Street in Moscow, and also the oil transshipping complex in the village of Roslyakovo-1 in Murmansk Oblast,’ – GVSU Chief Sorochkin boasted to ‘Rossiyskaya gazeta.’  He also recalled that today the general amount of losses, suffered by the state in the ‘Oboronservis’ affair, exceeded four billion rubles.”

“Serdyukov’s Brother-in-Law Could be Called for Questioning”

“So, investigators tactfully sidestep the question of whether the appearance of new figures and still more accused in the ‘Oboronservis’ affair is expected.  There are already a number of candidates to populate the list.  For example, there’s Marina Lopatina, ex-chief of OAO ‘Voyentorg’ and the ‘Red Star’ subholding.  But also head of ‘Oboronstroy’ Larisa Yegorina.  Both ladies are thought to be former classmates of Vasilyeva and at present are alleged to be on the run.”

“There are suspicions that Serdyukov’s brother-in-law is also on the run, still, it’s true, investigators are not confirming this information.  ‘I don’t have unambiguous information about this.  I confirm that we have questions for him, therefore he could be interrogated,’ – Sorochkin said.”

“Petersburg’s ‘Fontanka’ relays interesting facts from Puzikov’s life.  ‘No stranger to the family furniture business, Puzikov managed to achieve notable commercial successes also in the automobile business and in construction, and the amount of property he’s acquired is striking,’ – the article’s author notes.”

“According to the publication’s information, the Kuban native Puzikov built an expensive development where his neighbor found a space for Serdyukov’s OAO ‘Furniture-Market’ (the former ‘Lenmebeltorg’).  At the same address nine companies, fully or partly controlled by Puzikov, appeared, for example, OOO ‘Avtotsentr Soyuz 021.’  The auto business generally attracted Puzikov’s attention, ‘Fontanka’ notes.  So, he owns 15% of OOO ‘Aksel Group’ – a large dealer of BMW, Volkswagen and Toyota automobiles, one of the showrooms of which is located in the very same expensive development.  Incidentally, also located there is OOO ‘Avtoservis-MM,’ where Viktor Zubkov, father of Serdyukov’s wife Yuliya Zubkova bought a Toyota Land Cruiser, ‘Fontanka’ writes.”

“The publication also reports that Puzikov together with Aleksandr and Petr Usov and Artur Pozov was involved in construction, and also bought up property in Leningrad Oblast.  According to YEGRYUL [Unified State Register of Juridical Persons] data, today limited liability companies ‘Alyans’ (until 2012 – ‘Furniture-Market’), ‘Petersburg Agricultural Corporation,’ ‘Contemporary Food Technologies,’ ‘Investproyekt,’ ‘KRIOS’ fully belong to Puzikov, he has shares in OOO ‘Novyy Megapolis,’ ‘TrestStroyKomplekt’ and ‘InterVal.’  An OOO with the classic name ‘Vektor-SPb,’ in which Puzikov was the only participant, no longer belongs to him, but the firm remained in the larger family [?!] of the ex-defense minister — now its owner is Yevgeniya Vasilyeva, ‘Fontanka’ concludes.”