Publication: Monitor Volume: 7 Issue: 137

Oleg Lurye, the well-known investigative reporter for the biweekly newspaper Novaya Gazeta, has written an article in the paper’s latest issue alleging that Anatoly Chubais, currently head of United Energy Systems (UES) and a leader of the Union of Right-Wing Forces (SPS), and Alfred Kokh, currently head of Gazprom-Media, were involved in large-scale money laundering via the Bank of New York (BONY).

The article refers to a document first cited earlier this year by Novaya Gazeta concerning a trip Kokh made on January 3, 1996 to the Barbados, which, as Lurye notes, is known–among other things–as “an offshore haven for laundered money.” Kokh allegedly traveled to the island with one of the leading figures in the BONY scandal of 1999, Natasha Gurfinkel-Kagalovsky, and her husband. She was a BONY senior vice president in charge of the bank’s Eastern European division; her husband, Konstantin Kagalovsky, was at one time Russia’s representative to the International Monetary Fund and then a top executive first at Menatep Bank and afterwards at the Yukos oil company. It should be noted that no charges in connection with the BONY case have been brought against Gurfinkel-Kagalovsky, who was suspended from the banks at the height of the scandal and who later resigned. Last year she filed suit against the bank, denying any connection to the money laundering scandal and demanding US$270 million in compensation for damages to her reputation. At the time of the alleged Barbados visit, Kokh was first deputy chief of the State Property Committee, which was then formally headed by Sergei Belaev but actually under the control of Chubais, who was then a first deputy prime minister. Chubais would within weeks be dismissed by Boris Yeltsin for the notorious loans-for-shares privatization scheme at the end of 1995, but almost immediately rise from the ashes to run Yeltsin’s re-election campaign.

Lurye quotes an unnamed top U.S. Federal Bureau of Investigation official as telling him recently that the FBI had also been aware of Kokh’s and the Kagalovskys’ visit to Barbados. According to the FBI official, Kokh, in making the visit, was acting on behalf of Chubais, who at the start of 1996 needed a “mechanism” by which to send billions of dollars received as a result of privatization offshore and to launder a portion of these funds for Yeltsin’s re-election campaign. The Bank of New York was “the ideal variant,” the official told Lurye. Lurye also quotes the FBI official as saying that Chubais, “being a vice premier and a well-known figure,” did not want to meet directly with BONY officials, and thus sent Kokh as his “emissary.” At the same time, Lurye says, Chubais knew the major players in the BONY scandal very well and had met with them secretly in the United States.

Lurye also cites an audit carried out by the Audit Chamber, an independent Russian state agency, into the State Property Committee’s activities from 1992 to 1995. The state auditors expressed alarm, first, that U.S. and British firms had managed to acquire controlling shares in Russian aircraft manufacturers–including MAPO-MiG, Sukhoi, Yakovlev, Ilyushin and Antonov–and, second, that Germany’s Siemens had acquired a 20-percent stake in the Kaluga Turbine Factory–which, among other things, holds a state monopoly in welding technology needed for the construction of nuclear subs (see the eXile, #31, March 5, 1998). Lurye also quotes from a joint letter written by the Federal Security Service (FSB) and Foreign Intelligence Service (SVR) charging that the privatization of military-industrial enterprises like those was followed by a transfer of Russian military technology to the West so large that NATO inaugurated a special program devoted to processing the acquired information. Lurye concludes that between 1993 and 1995 Chubais “organized the sale of unique Russian [military] technology to the West,” for which the Russian budget received only US$450 million. Some of the remaining proceeds went to Yeltsin’s re-election campaign but, Lurye alleges, “the lion’s share” was hidden in BONY accounts. The journalists also cites an Audit Chamber finding that “privatization structures” connected to Chubais had received more than US$2 billion in credits from the West earmarked for “the development of privatization in Russia,” but that most of this money also disappeared. Lurye says there is “certain information” that “foreign special services” found some of these funds in BONY accounts (Novaya Gazeta, July 16).

Oleg Lurye, it should be noted, has investigated alleged corruption by top officials such as Prime Minister Mikhail Kasyanov, Kremlin chief of staff Aleksandr Voloshin and Pavel Borodin, the former Kremlin property manager who is now state secretary of the Russia-Belarus union. Last December, Lurye was severely beaten and had his face slashed by unidentified attackers (see the Monitor, March 26, December 18, 2000).