From top to bottom, how corruption infects Russia
The claims made in the WikiLeaks cables come as no surprise to Shaun Walker
Friday 03 December 2010
Everywhere you look in Russia, there are stories of corruption, whether it's a traffic policeman shaking down a motorist for a few pounds, or a businessman complaining that top-ranking government officials demanded millions of pounds in kickbacks or bribes. So the allegations contained in WikiLeaks' US diplomatic cables originating in Moscow are not that surprising to anyone who knows the country well.
According to the corruption perception index released by Transparency International, Russia is the most corrupt major economy. It comes in at 154th out of 178 countries ranked, below Haiti, Pakistan and Zimbabwe.
American diplomats believe people at the top in Russia, including the Prime Minister, Vladimir Putin, have "alleged illicit wealth", according to the cables. Mr Putin's spokesman Dmitry Peskov said that if the documents were genuine, they were "ridiculous" and "rubbish", but again, the claims are nothing new. The Prime Minister himself has dismissed similar claims in the past, when analysts have alleged that he has amassed a secret fortune, stashed away in Europe, or is the real owner of billion-pound stakes in various Russian companies.
Mr Peskov said that the cables rehashed old rumours, and, indeed, there have long been whispers in the capital that figures high up in the Kremlin have benefited from state deals. Rumours have swirled about offshore bank accounts, secret villas and enormous kickbacks at the very top of government, but they are impossible to confirm. The cables released this week suggest that US diplomats are playing a guessing game – they seem to have little access to the top Russian figures, and mostly rely on political analysts and opposition figures.
The former British ambassador to Moscow Sir Tony Brenton told the BBC that he thought the "mafia state" accusation – a quote given to US diplomats by a Spanish prosecutor – was "lurid". However, he said, there was no doubt that corruption permeates the system up to the top. "There are people very senior in the Russian system who are acting in a very criminal way," he said.
Away from the opaque world of the Kremlin, the allegations concerning corruption among government agencies and law-enforcement bodies are easier to verify. It is generally accepted that most of Russia's super-rich must at least have colluded with criminal groups in the 1990s in order to stay safe and get wealthy.
Even Mikhail Khodorkovsky, the former owner of Yukos who has spent the past seven years in jail and who is now a poster boy for the democratic opposition, has a less-than-clean past. In recent memoirs, former BP chief Lord Browne recalled how the oligarch boasted "how he could make sure oil companies did not pay much tax", and "how he had many influential people under his control".
In Moscow, businessmen have long claimed that any major project was impossible without the blessing (and subsequent financial reward) of Yelena Baturina, Russia's richest woman and the wife of Yuri Luzhkov, the capital's mayor until he was fired in September. A colourful dispatch from the US embassy about life in the capital refers to a "pyramid of corruption" with Ms Baturina at the top. She denies the allegations.
The police and other law-enforcement agencies are also on the take. Lawyer Sergey Magnitsky died in jail a year ago – he was arrested after uncovering a fraud involving hundreds of millions of dollars of government money, co-ordinated from the Interior Ministry. Down the chain, mid-ranking police officials harass businesses for "protection" money, and rank-and-file cops shake down migrants without proper papers for bribes.
Almost any Russian or foreign businessman who has worked in any sector in the capital will have a few tales to tell. The owner of a small hotel in Moscow says guests are frustrated because the hotel is difficult to find. "We would put up a proper sign, but we know that then we'd end up being visited by the police, by local rackets, and by every agency under the sun, and they'd all want a cut."
In rare cases when officials are taken to court over corruption, analysts say, it's rarely due to a desire for justice, but because that person has committed a misdemeanour or become "inconvenient" to someone more powerful. So it was with Mr Luzhkov. For years, corruption around the mayor and his wife was rumoured to be rampant, but it was only when the Kremlin decided to replace him that the state television started loudly investigating the rumours.
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