Mafia money laundering taints Gore

AL GORE, the politically accident-prone United States Vice-President, returned from his holiday this week to find himself once again in the hot seat, this time over reports of massive Russian money-laundering through the Bank of New York, and possibly several other American banks.

Fairly or not, the Russian money scandal, which is now the subject of criminal investigations in the US, Britain, Switzerland and Russia, has been seized on by Mr Gore's rivals as a stick with which to beat him. The risks to his presidential bid are considerable.

Mr Gore is taking the rap for as yet unproved charges that highly placed Russians diverted millions of dollars from the International Monetary Fund (IMF) loans into private bank accounts abroad, because he is the joint chairman of the US-Russia intergovernmental committee (which was set up to keep relations an even keel through Russia's post-Soviet reforms).

The awful irony for Mr Gore is that he was given this portfolio by President Bill Clinton so that he could gain hands-on experience and credibility in a major area of foreign policy. For the duration of Mr Gore's tenure, however, US-Russia relations have been fraught with volatility.

Russia has had no fewer than five prime ministers. Nato's military intervention in Kosovo set relations on a knife-edge. And now there is the fallout from allegations that appeared first in the New York Times about Russian money-laundering to the tune of perhaps $15bn (pounds 3.1bn) through US banks.

While the allegations were focused on money presumed to have come from Russian organised crime, the damage to Mr Gore could be limited. But the emphasis soon shifted to claims that highly placed Russian officials were involved, and that the cash may have been IMF loans diverted abroad.

In the past 48 hours, no fewer than five of Mr Gore's potential opponents, including his sole rival for the Democratic nomination, former senator Bill Bradley, have questioned his part in handling US relations with Russia. If he knew about the extent to which funds were being diverted, the argument goes, he should have insisted on more accountability from Moscow; if he did not know, he was incompetent.

Perhaps the most caustic comments came from Mr Bradley, who said that "several factors, including shortsighted US policy", had contributed to Russia's struggle to effect an economic transformation. "Our assistance and lending policies have done very little to further our strategic goal, the needs of the Russian people or the cause of Russian reform," he said in a statement.

On the Republican side, Elizabeth Dole said Mr Gore had "failed in his only major foreign policy effort". Condoleezza Rice, a Russia expert and senior foreign policy adviser to George W Bush, said: "The big question that troubles me is did we have a good system of accountability [for the money]?" Senator John McCain called for an immediate halt to IMF loans to Russia and Steve Forbes, the billionaire publisher, commissioned a radio advertisement claiming that "Russia remains an economic and political time bomb" and that Mr Gore owes "the American taxpayer an apology".

The IMF has defended its lending to Russia and maintained that there is no evidence that loan funds were diverted. Mr Gore's office has stressed that the Vice-President consistently pressed Russia to clamp down on corruption and White House officials have condemned the criticism as "political". Mr Gore has so far declined to comment.

Comments