FEDERATION COUNCIL REFUSES TO ACCEPT SKURATOV’S RESIGNATION.

The Federation Council, the upper house of Russia’s parliament, has refused to accept the resignation of Yuri Skuratov, who stepped down as the country’s prosecutor general at the beginning of February, ostensibly for health reasons. The members of the Council–called “senators,” actually governors and regional heads–today refused Skuratov’s resignation in a secret vote of 142-5, with three abstentions.

Following today’s vote, Skuratov said he would agree to remain in his post. “I will not give up the work, if you extend your trust and support to me,” Skuratov said, adding that he had not done anything “in breach of the law.” During a speech to the Federation Council earlier today, Skuratov said that his original decision to step down had been forced by–above all–people who had engaged in “dubious speculation” on the GKO market (the short-term treasury bill which collapsed last August), as well as “two former deputy prime ministers,” several members of the current cabinet, some former managers of Russia’s Central Bank and several State Duma deputies. Skuratov also said that oligarchs involved in “criminal cases of corruption in high places” also contributed to his resignation, and named the criminal cases against Aeroflot airlines, the AvtoVAZ car manufacturer and the Atoll private security firm–all reportedly controlled by tycoon Boris Berezovsky. Skuratov said he was confident that the Federation Council members were concerned about law and order. “The choice is between abiding by the law or by what the CIS executive secretary describes as ‘understanding what life really is,'” Skuratov said, referring to Berezovsky, whom Yeltsin recently fired as CIS executive secretary (Russian agencies, March 17).

That Skuratov put the major blame on GKO speculators is significant. The prosecutor general’s office has been investigating the reasons for last August’s financial collapse, and has reportedly uncovered evidence that officials of the Central Bank and Finance Ministry illegally profited from trade in GKOs, allegedly using Russia’s hard currency reserves and insider information to make GKO investments. Prior to stepping down, Skuratov sent a letter to the State Duma charging that the Central Bank had placed billions of dollars from Russia’s hard currency reserves with FIMACO, an obscure asset management company on the Isle of Jersey. State Duma deputy Nikolai Gonchar subsequently charged that officials used FIMACO and several other Central Bank subsidiaries to make illegal GKO trades.

VOTE NOT TO ACCEPT SKURATOV’S RESIGNATION A BLOW TO KREMLIN.