June 17, 2000    
This Date's Issues: 4371 • 4372 • 4373


Johnson's Russia List
#4372
17 June 2000
davidjohnson@erols.com


[Note from David Johnson:
1. Reuters: Putin back in Moscow faces media magnate scandal.
2. Interfax: POLL SHOWS MAJORITY OF RUSSIANS FEAR CLAMPDOWN ON FREEDOM OF SPEECH.
3. Baltimore Sun: Kathy Lally, Arrest of TV network boss revs up Russian satirists.                         Puppet program continues to skewer Putin's government.
4. Moscow Times: Matt Bivens, Putin's Didactic Dishonesty.
5. Peter Ekman: Reznik.
6. Isabella Ginor: Turner angling for NTV?
7. The Electric Telegraph (UK): Marcus Warren and Ben Aris,
Oil boss warns Putin of slide towards KGB past. (Khodorkovsky)
8. Financial Times (UK): Oligarchs discover solidarity: 
The recent jailing of a Russian media magnate may prove a serious 
mistake for Vladimir Putin, writes Andrew Jack.
9. BBC MONITORING: NTV, RUSSIAN MEDIA MOGUL'S LAWYER INTERVIEWED ON "HERO OF THE DAY" (Genri Reznik)
10. The Globe and Mail (Canada): Geoffrey York, Canadians embroiled in Russian spy scandal. Secret police suspect universities' research was cover for espionage; academics deny it. (Re Igor Sutyagin of the Institute of USA and Canada Studies)
11. Washington Post: Congressman Benjamin Gilman, It's Time Russia Paid Its Debts.]
*******


#1
Putin back in Moscow faces media magnate scandal


MOSCOW, June 17 (Reuters) - President Vladimir Putin returned to Moscow on 
Saturday and to a row over the arrest and sudden release of a top media 
magnate which cast a dark shadow over the Russian leader's week-long European 
tour. 


Vladimir Gusinsky, owner of Media-MOST, Russia's only independent national 
media empire, was arrested and jailed on Tuesday on suspicion of fraud in a 
move which stirred fears at home and abroad of a new clampdown on press 
freedoms. 


Putin said in Berlin on Thursday he thought jailing Gusinsky was excessively 
harsh, but insisted he had no influence over the prosecution service, which 
he said was politically independent. 


He said he would try to find out more about the case on his return to Russia. 
Putin flew back to Moscow on Saturday afternoon from the ex-Soviet republic 
of Moldova. 


Gusinsky, whose media outlets including NTV television have been critical of 
Kremlin policy, was formally charged with embezzlement on Friday but was 
released late in the evening without explanation on condition that he not 
leave the country. 


The United States reacted swiftly and positively. 


``We are pleased that Mr Gusinsky has been released. President Putin and his 
government appear to be taking steps to close this troubling episode,'' said 
P.J. Crowley, spokesman for the White House National Security Agency. 


In Berlin, Chancellor Gerhard Schroeder's top foreign policy adviser told 
Reuters the German leader had played a key role in encouraging Putin to have 
Gusinsky freed. 


``During their dinner together, the German chancellor, while expressing 
complete respect for the independence of the judiciary, said it would be good 
for Russia's reputation if Mr Gusinsky was freed as soon as possible,'' said 
Michael Steiner. 


LAWYERS, COLLEAGUES DEFIANT 


But Gusinsky's lawyers said the battle was not over and vowed to fight to 
have the travel ban on Gusinsky lifted. 


``The defence intends to work towards having the charges (against Gusinsky) 
lifted and the criminal case against him dropped,'' he told Interfax news 
agency. 


Gusinsky's deputy at Media-MOST, Igor Malashenko, said his boss's arrest was 
an attempt to intimidate Russian journalists. 


``But there is now a new generation of journalists in Russia who are not so 
easily frightened,'' he added. ``Russia has no future without a free press.'' 


Astakhov criticised the way Gusinsky was freed at night when many journalists 
had gone home. ``The prosecution took all measures possible, releasing him 
after dark, to make sure the case received less attention.'' 


POLITICIANS WORRIED BY IMPLICATIONS OF CASE 


Russian politicians welcomed the decision to free Gusinsky, but said the 
incident raised some worrying questions. 


``Along with positive feelings that public opinion does have some influence 
over the authorities, there nevertheless remains a bitter aftertaste that 
Russia still has a long way to go to become a law-based society,'' Sergei 
Ivanenko of the liberal Yabloko party told Ekho Moskvy radio. 


Moscow Mayor Yuri Luzhkov, who earlier this week offered to take Gusinsky's 
place in jail, said the decision to free the businessman was as arbitrary as 
the one to arrest him. 


The World Jewish Congress in New York said it was pleased that Gusinsky had 
been freed but pointed out the fraud charges still stood. Gusinsky heads the 
Congress's Russian branch. 


``The news of his release is good, but the situation remains grim,'' said 
Elan Steinberg, the Congress's executive director. 


Russian media have speculated that influential members of the presidential 
administration were behind the decision to arrest Gusinsky, possibly over his 
anti-Kremlin stance. 


The liberal Sevodnya newspaper, also part of Gusinsky's empire, repeated 
claims often aired in the media in recent days that Putin's shadowy but 
powerful chief-of-staff, Alexander Voloshin, was behind Gusinsky's arrest. 


``It will not be easy for the president to distance himself from the 'Family' 
even if he wants to,'' the paper said, alluding to the close-knit group of 
aides and businessmen including Voloshin once close to Putin's predecessor, 
Boris Yeltsin. 


******


#2
POLL SHOWS MAJORITY OF RUSSIANS FEAR CLAMPDOWN ON FREEDOM OF SPEECH
Interfax 


Moscow, 16th June: Recent events such as the arrest of media mogul Vladimir
Gusinskiy have been making the Russian media increasingly fearful that the
authorities are clamping down on the freedom of speech. 


This is a prospect that also frightens ordinary Russian citizens, 41 per
cent of whom think that the "authorities intend to restrict the freedom of
speech" while 33 per cent do not. Every second Russian would oppose
restrictions on the freedom of speech (50 per cent) and half that would
welcome it (23 per cent). Another 18 per cent are indifferent. 


These figures were released by Public Opinion Foundation on Friday [16th
June] after a survey of 1,500 urban and rural respondents across Russia on
June 10. 


That the authorities intend to curtail freedom of speech is the belief of
55 per cent of those in Moscow, St Petersburg, and other large Russian
cities (30 per cent say they do not think so), among people with higher
education (51 per cent yes, 31 per cent no) and among those who voted for
candidates other than Vladimir Putin or Gennadiy Zyuganov in March's
presidential elections (51 per cent yes, 34 per cent no). This view is
predominant across all social, demographic, and electoral groups. 


Every third Russian assesses the degree of the freedom of speech in Russia
as "limited" (31 per cent), every fourth as "normal" (25 per cent), and 22
per cent of respondents believe "the freedom of speech is excessive". A
surprising 12 per cent hold the view that there is no freedom of speech in
Russia at all. 


In general, a clampdown on the freedom of speech would be taken most
negatively in Moscow, St Petersburg, and other large cities, but would be
approved in rural areas. However, even among country dwellers the opponents
of restricting the freedom of speech outnumber supporters by three to one. 


******


#3
Baltimore Sun
June 16, 2000
[for personal use only]
Arrest of TV network boss revs up Russian satirists
Puppet program continues to skewer Putin's government
By Kathy Lally
Sun Foreign Staff


MOSCOW - The owner of their station is in jail, and the NTV television 
reporters and satirists have learned a serious lesson about the dangers of 
criticizing the Kremlin and the limits on freedom of speech in President 
Vladimir V. Putin's Russia. 


Yesterday the satirists - about 25 puppeteers, writers, artists, technicians 
and a director - assembled in a cavernous film studio, putting that lesson to 
good use. 


They were training their cameras, lights and wicked wit on a rubbery puppet 
in their midst. They were preparing, once more, to skewer Vladimir Putin. 


"This is how we can resist," said Grigory Lubomirov, director of NTV's weekly 
"Kukly" ("Puppets") program. 


"Maybe they'll arrest us tomorrow," a cameraman offered. 


Vladimir A. Gusinsky, who oversees a media empire that includes NTV - 
Russia's only independent television network - was arrested Tuesday and taken 
to a dank, overcrowded jail notorious for inedible food, ubiquitous lice and 
rampant tuberculosis. 


The arrest has been treated as a sinister warning to the media here, 
dominating the news all week. 


Gusinsky, who also leads Russia's Jewish Congress, has not been charged with 
anything, though the prosecutor general's office said he is being 
investigated on suspicion of embezzling $10 million connected to the purchase 
of shares in a St. Petersburg company called Russian Video. 


Yesterday, the prosecutor announced that Gusinsky would be charged today, but 
he did not say what the charge would be. 


The great majority of politicians and commentators dismiss the embezzlement 
accusation as ludicrous. 


Gusinsky is in prison, they say, because NTV reporters dared to broadcast 
reports critical of the war in Chechnya, because the puppet show regularly 
made fun of Putin and because Gusinsky ignored Kremlin warnings to muzzle his 
employees. 


The general feeling here is that all businessmen can be found guilty of 
something if the authorities so desire, so other motives must be at work. 


"It is allowed to violate the laws as much as you want," said Viktor 
Shenderovich, a "Kukly" writer, "but it's forbidden to contradict." 


Gusinsky was taken to prison, he said, to humiliate and break him 
psychologically. And the West should understand that it underestimated Putin, 
who spent most of his career as a KGB officer. 


"This is only the beginning of their campaign," Lubomirov said, asserting 
that Kremlin operatives were orchestrating the action against Gusinsky. 
"Their goal is to remove the present leaders of NTV and replace them with 
people of their own." 


In May, Lubomirov said, Putin's chief of staff, Aleksandr Voloshin, told NTV 
to stop using a Putin puppet on "Kukly" and to stop criticizing the war in 
Chechnya. As if in emphasis, masked tax police raided the headquarters of 
Gusinsky's holding company, Media-Most. 


Lubomirov and the other "Kukly" writers responded in their usual way: 
brilliantly. They dressed Moscow Mayor Yuri Luzhkov and an assortment of 
powerful governors as ancient Hebrews and showed them wandering 10 years in 
the desert. 


Finally, Moses (Voloshin) appeared bearing commandments from a God so 
powerful none dared mention his name. He warned them against false idols and 
worshipping other gods. He told them not to steal. "Don't steal?" they 
exclaimed in shock. 


When they appeared unwilling to submit, the sky darkened, thunder rolled, and 
a bolt of lightning struck nearby. They quaked in fear and submission. 


Putin, never mentioned, never appearing, remained a huge, threatening 
presence. The program ended with the camera lingering on a burning bush. 


Then, Gusinsky's people apparently went too far. 


During a summit with Putin, President Clinton appeared June 4 on an NTV 
program called "Itogi" and on Gusinsky's Ekho Moskvy Radio in a show of 
support for freedom of the press. 


"When I heard Gusinsky was arrested," Lubomirov said, "it was clear it was 
revenge for Clinton's appearance. 


"It was a demonstration to everyone of who runs Russia and how they run it. 
It was a warning to the American president he should not get involved where 
Russian leaders don't want him to get involved. 


"Today a real coup is under way," he said. "The world shouldn't have any 
illusions about who has come to power here." 


Yesterday, Gusinsky sent Russians a message through his lawyer. 


"This is political intrigue, organized by high-ranking representatives of the 
government who consider freedom of speech a danger," his statement said. "It 
is an obstacle to their attempt to build their understanding of a new Russia, 
which is in fact a return to the totalitarian past, with gulags and a 
dictatorship of the law." 


A prison official assured reporters that Gusinsky would not be harmed, that 
he was not in a cell with criminals. 


The prisoners were being fed kasha - a buckwheat porridge - and bread and 
butter, he said. 


Putin, who has been traveling in Spain and Germany, said he had not known of 
the arrest, denied that it was an attack on the news media and asserted that 
he believed Gusinsky should not have been arrested. 


"I personally believe that this is excessive," Putin told reporters in 
Berlin. 


All this, said Shenderovich, provides great fodder for "Kukly." 


"Extreme situations are the best possible for the program," he said, "but I'd 
rather have a dull program and a stable country." 


The "Kukly" crew expects to finish filming Sunday's episode today. As might 
be expected, it is a lively one. 


Voloshin is cast as the great Russian artist Repin, who is creating a famous 
painting done from 1901 to 1903 called "Solemn Session of the State Council." 


The plot involves how Putin and the other politicians will be portrayed in 
the painting. In the end, all the political maneuverings matter little. The 
Russian people appear in prison uniforms. The puppet-politicians stand before 
them. 


And then, with great finality, an Iron Curtain clanks down, cutting them off 
from the rest of the world. 


******


#4
Moscow Times
June 17, 2000 
PARTY LINES: Putin's Didactic Dishonesty 
By Matt Bivens 


"And now: What is democracy? Some time ago we had in Chechnya f you probably 
heard about this f a Russian journalist who was detained. And everyone 
immediately started demanding of me that I free him. Even though it was not 
me who arrested him! þ I did indeed talk to the Interior Ministry. I told 
them that I thought it was incorrect to keep this person detained. þ And they 
quickly let him go. Then came the second wave of criticism: Why did the 
president interfere in the work of the law enforcement agencies? I think this 
second wave was correct. And that is democracy." 
-- President Vladimir Putin this week in Germany. 


So that's democracy. I must have been confused. Democracy, it seems, is a 
system where the president is so all-powerful that he can launch a military 
assault that kills thousands of his own citizens without facing any real 
procedural oversight, but at the same time is such a diffident wilting flower 
that he cannot call his own ministers on the carpet to say: You probably 
should not kidnap people. 


The journalist "you probably heard about" is Radio Liberty's Andrei Babitsky. 
As Putin tells it now, Babitsky was detained, Putin raised an eyebrow and the 
government "quickly let him go." 


That is a staggeringly dishonest characterization of what happened. That 
Putin would offer it suggests he has no intention of dealing honestly with 
any of us f that all of this pious talk of the nature of democracy is a mere 
pose. 


Back when NTV was nervously toeing the government line, Babitsky's voice 
could be heard across the nation criticizing the war. Then in January, 
Babitsky was arrested near Grozny and thrown into a federal prison in 
Chernokozovo, where he was beaten (and heard the shrieks of others suffering 
far worse). 


The government eventually owned up to holding Babitsky, though it did not let 
him speak to a lawyer or to loved ones. After about a month of this, federal 
agents handed Babitsky over to unspecified men in masks. The explanation was 
a thuggish shrug: The government gave Babitsky to "Chechen terrorists" 
because he prefered their company. 


Babitsky eventually resurfaced, and one might have expected a democratically 
elected president to be shocked and outraged by his accounts (and those of 
others) about Chernokozovo f where federal officials reportedly raped and 
tortured men and women. After all, if nothing else, those rapists and 
torturers are still out there. Instead, the government slapped some fresh 
paint on Chernokozovo and took skeptical Western journalists on a tour f one 
that ended when the bus drove, without stopping, through a crowd of Chechen 
women desperate to tell the true stories. 


Or one might have expected the president to have rebuked Interior Minister 
Vladimir Rushailo f since when are federal agents in the slave-trading and 
kidnapping business? 


Instead, Putin labeled Babitsky a "traitor" and embraced his mistreatment. We 
saw as much when Putin f now a legalistic rule-of-law man vis-a-vis Gusinsky 
f announced he should never have interceded to stop his government's 
persecution of Babitsky. And we saw it in an interview Putin gave to 
Kommersant this spring: 


Q: You've simply taken a Russian journalist and handed him over to 
no-one-knows-who. 


Putin: He's not a Russian journalist. 


Q: He's a Russian citizen. 


Putin: That's what you say f he's a Russian citizen. Then [if you are a 
citizen] behave by the laws of our country, if you expect that in relation to 
you, those same laws will be observed. 


Q: All the same, it's still not clear by what law he could be given away. 


Putin: He volunteered. 


Q: And if he had volunteered to be shot? 


Putin: That's not possible. It is forbidden by internal instructions. 


Ah, yes, the internal instructions f those pillars of a law-based state. 


Putin is again hiding behind "the internal instructions." It seems the 
prosecutor general is not subordinate to the president. In fact, Putin can't 
even get him on the phone to ask about Gusinsky. (Maybe he would have had 
better luck if he'd dropped some hints about soft porn home movies.) As Putin 
didactically explained in Germany, in some nations, the prosecutor is 
subordinate to the Justice Ministry f but in Russia he is "absolutely 
independent." All that was missing from this lovely story was a Boris 
Berezovsky-free flow chart of how responsibilities are distributed in the 
Cabinet and the Kremlin administration. 


Matt Bivens is the editor of The Moscow Times. 


******


#5
From: "Peter D. Ekman" <pdek@co.ru>
Subject: Reznik
Date: Sat, 17 Jun 2000


RE JRL 4370 #8 "Perhaps mistakenly, I seem to recall that when Primakov had
issued a warrant
for Berezyovsky's arrest, Berezyovsky was in Paris, and held a press
conference with a lawyer, whom I though was Genry Reznik. This happens to
be one of Gusinsky's lawyers mentioned in the Moscow Times article you
included in JRL 4368."


Reznik was Berezovsky's lawyer at the time and made several appearances on TV
regarding the case. He was also part of Alexander Nikitin's legal team and
has
made several appearances for NTV even before the current case. I guess
lawyers get around, Reznik especially so. I'd like to see something more on
his background.
Pete Ekman


*******


#6
Date: Fri, 16 Jun 2000 
Subject: Turner angling for NTV?
From: Isabella Ginor, <remgin@netvision.net.il>


Has anyone noticed the mention by Gusinsky's deputy at Media-Most, Igor
Malashenko (in an NTV interview Wednesday night from Spain, where he was
shadowing Putin) that there is a scheme afoot in the Kremlin to transfer
NTV to the ownership of Ted Turner -- who was Putin's honored guest in
May, at the time of the raid on Media-Most? Can anyone stateside look
into this?


******


#7
The Electric Telegraph (UK)
16 June 2000
[for personal use only]
Oil boss warns Putin of slide towards KGB past
By Marcus Warren, and Ben Aris in Moscow
THE Russian media magnate Vladimir Gusinsky was released from prison last 
night after criticism of his arrest on charges of "gross embezzlement".
Hours before his release, another prominent businessman had warned President 
Putin that he must break with the habits and instincts of his KGB past if 
Russia was to avoid sliding into authoritarian rule. Mr Gusinksky's arrest 
was a fresh reminder of the huge powers of Moscow's security services, said 
Mikhail Khodorkovsky, chairman of the oil giant Yukos.


Mr Gusinsky was released on a written pledge that he would not leave the 
country. The charges still stand. His lawyers had expected him to be freed 
following comments by Mr Putin that his arrest was "excessive". Mr Putin told 
a press conference in Germany, where he is on a state visit: "I don't think 
the prosecutor should have taken a step like arrest."


But Mr Khodorkovsky dismissed Mr Putin's protests that he knew nothing of 
plans to detain Mr Gusinsky and called on the Russian leader to rid himself 
of attitudes he learned as a KGB officer. Mr Khodorkovsky said in London: "I 
think there is a lot in himself that Mr Putin must eliminate if he wants to 
be the president of a democratic country. He must reject a lot of himself and 
force many others to do the same.


Mr Putin's sensitivity to criticism, believed to be a major factor in the 
arrest of Mr Gusinsky, owner of Russia's only independent media empire, was 
partly the fruit of the recently elected president's "insecurity", Mr 
Khodorkovsky said. Such a personal attack on the president is highly unusual 
in Russia, even from such an influential man.


Mr Khodorkovsky said: "Mr Putin should have known about the plans to arrest 
Gusinsky. He was obliged to know and I am sure that he did." One of a number 
of businessmen to sign a letter denouncing the arrest and offering to stand 
bail, Mr Khodorkovsky is seen, like Mr Gusinsky, as belonging to the elite of 
Russia's "oligarchs" who, under President Yeltsin, had intimate access to the 
Kremlin.


Mr Putin has yet to move against their entrenched interests, but the charges 
against Mr Gusinsky show that those who fall out of favour can expect little 
mercy. Yukos is Russia's second biggest oil company and its treatment of 
minority shareholders has provoked loud controversy in the past.


The oligarchs in general have been held up as symbols of the worst excesses 
of Russian business conduct. But Mr Khodorkovsky said his Western critics' 
demands for Mr Putin to get tough with them only encouraged the forces behind 
the arrest of Mr Gusinsky. Mr Gusinsky's Media-Most holding company is worth 
more than £1.3 billion.


Lawyers were surprised by the wording of the charges, saying that an 
accusation of "gross embezzlement" was almost unprecedented. If found guilty, 
he faces up to 10 years in prison plus the confiscation of his property.


******


#8
Financial Times (UK)
17 June 2000
[for personal use only]
Oligarchs discover solidarity: The recent jailing of a Russian media
magnate may prove a serious mistake for Vladimir Putin, writes Andrew Jack.


Uniting no fewer than 17 of Russia's fiercely competitive oligarchs around
an apparent shared concern for one of their own would seem no easy feat.
But in what may prove the first serious misjudgment of his administration,
Vladimir Putin managed it this week with the arrest of Vladimir Gusinsky. 


The media magnate, held until last night in one of Moscow's most decrepit
prisons under a section of the legal code typically reserved for dangerous
criminals, is officially under investigation for alleged embezzlement. But,
as a powerful critic of the Kremlin, he is widely perceived as the victim
of a political vendetta. 


In the opaque and byzantine world of Russian politics, there is no shortage
of multiple and contradictory explanations for the authorities' actions.
International concern has focused largely on the threat to the country's
fragile press freedoms. 


Among the unlikely array of rich and powerful Russian businessmen who lept
to Mr Gusinsky's defence, however, the fear is of a broader campaign
against figures who wielded such power under Boris Yeltsin in the 1990s. 


Never has such a powerful oligarch been challenged so openly since the
collapse of communism. "For sure there is fear," says Pyotr Aven, head of
the Alfa financial group and one of the signatories to an open letter of
protest. "It reminds me of the Soviet past. If this sort of approach
starts, everyone is under threat." 


Whatever the truth, there is little doubt that NTV, Mr Gusinsky's main
television station, has been a constant irritant to the Kremlin. Quite
apart from the prominence it gives to political opponents, its relatively
critical coverage on the government's military campaign in Chechnya, and
its exposes on government corruption, it mocks the administration every
week in a satirical weekly puppet show, Kukly. 


The final insult may have come with the decision by Bill Clinton, the US
president, during his visit to Moscow this month to give his only exclusive
interview to Moscow Echo, a radio station also within Mr Gusinsky's Media
Most group, when he stressed the importance of freedom of speech. 


But while these broadcasters have proved Media Most's anti-government
mettle, they have not always demonstrated independence. Mr Gusinsky, and
his TV anchormen, portray themselves as defenders of free speech. Yet they
have also been part of an "engaged" form of journalism, strongly partisan
for Mr Yeltsin during his 1996 re-election, and more recently deliberately
adopting an anti-Kremlin line. 


Media Most was for Mr Gusinsky first and foremost a business, which he
built up using its growing influence to leverage political support and
money from the state. His undoing was to seek patronage from, and lend
endorsement to, Yuri Luzhkov, the mayor of Moscow who was only last year
tipped as a presidential front-runner but has since lost out in the power
struggle against Mr Putin's circle. 


Some insiders suggest Mr Gusinsky's centralised, mercurial management style
helped weaken his group financially, making it unnecessarily dependent on
the authorities that have become his enemies. Certainly, the Kremlin has
wasted little time in applying pressure. 


By his own admission, Mr Gusinksy helped create the oligarch system while
building his business empire. But if Mr Putin was launching an
anti-corruption campaign, there are more flagrant targets with which to
begin. 


The difference, argues Sergei Markov of the Institute of Political Studies,
is that Mr Gusinsky chose to oppose the Kremlin while other oligarchs tried
to show loyalty and work from within to influence government policy in
their favour. That has left Mr Gusinsky vulnerable, not least to rival
power-brokers who may have had a hand in this week's attack. 


Mr Putin, so sure-footed in his exploitation of the Chechen conflict during
the president campaign, may have calculated that jailing one prominent
critic would send a warning to other potential enemies to stay in line. He
could also claim to the international community that Russia's formal
separation of powers leaves him unable to intervene in the judicial
processes. 


If so, the international outcry and the unexpected rallying of other
oligarchs suggest he has miscalculated. For the first time, the former KGB
spy may have betrayed a lack of political experience. But if he did not
endorse the action, as he has tried to claim, it suggests a lack of control
over an administration in which some authoritarian tendencies are
resurfacing from below. 


"This is the greatest political mistake since Putin's coming to power,"
says Vyacheslav Nikonov, head of the Foundation Politika, a think-tank. "We
have on our hands a big scandal which may have negative consequences for
the president and for the reputation of our country." 


The only benefit of the recent intrigue is an unexpected concern by
Russia's business elite about judicial manipulation and the lamentable
state of the country's prisons. But the biggest casualty is likely to be
media diversity and independence. 


******


#9
BBC MONITORING 
RUSSIAN MEDIA MOGUL'S LAWYER INTERVIEWED ON "HERO OF THE DAY"
Source: NTV International, Moscow in Russian 1553 gmt 16 Jun 00 


Henri Reznik, the lawyer of imprisoned Russian media mogul Vladimir
Gusinskiy, has described charges against him as symbolic and said that the
real aim of the investigation was to keep Gusinskiy in custody for as long
as possible, to break him psychologically and to liquidate his business.
Reznik was interviewed on the "Hero of the Day" programme, broadcast by
Russian NTV channel, which is part of Gusinskiy's media empire. He said a
signal was sent to all the businessmen who own property that once belonged
to the state that deprivatization was coming. "I have the impression that a
new order is being established with the help of force structures," he said.
The following are excerpts from the report by Russian NTV International
television: 


[Presenter Svetlana Sorokina] Hello, the "Hero of the Day" programme is on
the air. The head of the Media-Most holding was officially charged today
but the measure of restraint remains unchanged. It was expected that, after
all, he would possibly be released from prison today, but, no, he remains
in the Butyrskaya Prison. We will be discussing with Genri Reznik,
[Vladimir] Gusinskiy's lawyer, how the events may develop and what the
defence is undertaking in order to somehow change the situation. Hello,
Genri Markovich. 


[A] Good evening, Svetlana. 


[Q] Have you been able to interpret these few pages of the official charges
which you have copied by hand? Why weren't you allowed to make a photocopy
and why didn't they make one beforehand? 


[A] I don't know. The investigator simply said that he had not yet fetched
a copy for the defence. 


[Q] He didn't expect you to be there? 


[A] You see, somehow he had obviously been in a hurry. Even though I have
to say that in all cases this is a fundamental procedural document and a
copy is simply always handed to the defence. Well, that is clear, because
the wording of the charges are the basis for our work. That is why it took
us almost an hour to copy it. Well, this is the latest, strictly speaking,
spiral in lawlessness... 


[Q] That is to say, you were not convinced by the wording? What did it say
there on the whole? 


[A] It is, how shall I put it, complete gibberish and its task is to draw
us into this absurd situation. 


After all, fraud is what the charges boil down to. Fraud is embezzlement
perpetrated by means of deception or the abuse of trust. The investigation
will of course not pay any attention to such small details. It says in the
law: deception or abuse of trust, but here it says both deception and abuse
of trust. 


Well, strictly speaking this can be translated as follows: all
entrepreneurial structures, including the Media-Most holding set up by
Gusinskiy, were set up with a criminal intent - they simply robbed the state. 


The situation is as follows: you see, this current charge is symbolic. I am
saying current quite deliberately and definitely: a black signal has been
sent to all businessmen who own property that once belonged to the state.
This is an episode, let's say, not an episode but the activities of
Russkoye Video [St Petersburg TV company], a case that has been under
investigation for almost three years. Then the general director was
prosecuted. 


[Q] Rozhdestvenskiy? I believe he has been in prison for two years? 


[Reznik] He has been in prison for two years. 


[Presenter] Without a court hearing too? 


[A] Yes. An investigation was a long one. A whole mass of witnesses were
called. On 5th November, Vladimir Aleksandrovich Gusinskiy was questioned
as a witness in this case. He was told, in the presence of an outsider:
Vladimir Aleksandrovich, investigators have no claims to either you or
Media-Most. 


The current situation is very curious. Crime is seen in the very fact of
holding shares. This is why I say that this is a black signal. 


[Q] Deprivatization and the revision of the results of what has been done. 


[A] This is what I am saying: a black signal. The situation was as follows:
in the past, Russkoye Video was a state-owned company. It was subsequently
floated on the stock market - Gusinskiy was nowhere near it at the time -
and a licence was issued. All that was before Gusinskiy. Later,
Rozhdestvenskiy contacted Media-Most and it bought the majority of shares. 


[Q] For a very small sum of money they say now. Can it be that this is now
being seen as fraud? Although how can one prove how much they were really
worth? 


[A] This is absolute gibberish, I must say. At what price it was bought
when it was floated on the market and what happened later - all this cannot
by definition constitute a crime. The most interesting thing is that
Rozhdestvenskiy has been in prison for two years. His case has been sent to
court. 


[Q] How long can one be held in prison before trial - two years? 


[A] A year and a half. A court can extend this term by another half a year
under certain conditions. 


[Q] Are two years the maximum? Theoretically, he should be released after
two years if his guilt has not been proved in court. 


[A] No. When the case is already being considered by court, this does not
form part of the term in custody. 


[Q] A court investigation can now last for an indefinite period. 


[A] A court investigation which can last indefinitely. The main thing is
that, over these two years when a charge against Rozhdestvenskiy was worded
- it does not include the episode which is part of the charge against
Gusinskiy. Gusinskiy has been accused of stealing, i.e. defrauding, in
association with Rozhdestvenskiy. I can tell you that this convinced me
finally that the investigation pursues just one aim: to keep my client in
custody for as long as possible, to break him psychologically and to
liquidate his business, i.e. the Media-Most holding company, NTV and
publications. Why? Because a situation is now emerging when a court process
is under way in St Petersburg and we have informed Rozhdestvenskiy's
lawyers, and they have already shown interest in this, that his case has
been sent to court but it does not contain not just episodes ... but the
whole activity - it was on the surface. What did they investigate at the
beginning: what kind of company was it, when was it floated? This has not
been included in the charge against Rozhdestvenskiy. What happened is that,
in effect, two people and two cases were artificially separated. And
lawyers there will be forced to submit a question about merging these two
cases... 


[Q] What follows from this? If the cases are lumped together, what then? 


[A] What can I say? In that case all sorts of things are possible. They
could, for instance, lump together the cases and decide where the
investigation will be carried out: St Petersburg, because that is where
Russkoye Video is based. 


[Q] And Gusinskiy could be transferred there? 


[A] And Gusinskiy could be transferred there. Such a transfer is not for
the faint-hearted. It means travelling in a rail carriage for prisoners...
Actually, this already leaves no doubt at all that we are dealing with
arbitrary conduct, but this arbitrariness is so insolent, blunt and
provocative. 


[Q] Do you feel that basically everything is aimed at keeping Gusinskiy as
long as possible before and during the investigation, and, after that, in
accordance with the court, that is to say, the duration of time in custody
involved could be whatever they like? 


[A] You see, this is not a feeling I have - I am virtually convinced that
we are now dealing with adversaries who are prepared for anything. This
conviction, which, alas, is of course not optimistic, has been reinforced
and confirmed in me by our president's address. Vladimir Vladimirovich Putin- 


[Q] Well, he said that the measure of restraint was excessive. 


[A] After saying: you see, this is my private opinion. 


[Q] Yes? 


[A] But the General Prosecutor's Office in our country is independent...
Putin understands humour after all, but I simply did not expect him to be
such a humorist, you know. But to proclaim that our Prosecutor's Office is
independent while, with Vladimir Vladimirovich's [Putin's] direct
participation, [former prosecutor general Yuriy] Skuratov's arms were being
twisted... When Putin only had to hint after I had told him that he was
obliged to intervene in [Radio Liberty correspondent Andrey] Babitskiy's
case, he actually only said yes indeed, and Babitskiy was released the next
day. Was that a simple coincidence? But now, the Prosecutor General's
Office has become independent... 


As for Gusinskiy's arrest. Why hurry pressing charges? After all, Gusinskiy
was arrested under an extremely rarely-used article, No 90, of the Criminal
and Procedural Codes. Which says that in exceptional cases a person can be
held in detention pending charge... 


All this was thought through very carefully. They wanted to drag us into
this absurd situation, this nonsense. This is because of the way
investigation process is organized in our country - we have a very
inefficient judicial control over the investigation process. I can be
writing an appeal about one thing while their response will be about
something totally different. And it will continue indefinitely. It will be
very difficult to get any truth in this situation... 


[Q] Genri Maksimovich, what aims the investigators are trying to pursue by
questioning the company shareholders such as [Media-Most deputy head Igor]
Malashenko, [NTV journalist] Kiselev and [chairman of the All-Russia State
Television and Radio Broadcasting Company Oleg] Dobrodeyev? 


[Reznik] First of all, they have bound bind themselves with this idiotic
formula because if the criminal actions are in floating the company then
all the shareholders can presumably be accomplices. How they gathered, how
they spoke among themselves about how they were going to buy shares. 


[Presenter] I.e. how they were formulating their criminal intent. 


[A] Yes, of course... What is happening now, I will tell you without any
reservations, is that a lot here is being restored on a different footing.
I have the impression that a new order is being established with the help
of force structures... 


The aim is to destroy the organization and the company. Over a long period
of time, they will summon people and question them time and time again,
they will carry out inspections, confiscate documents and prevent normal
work. This our law-breaking, not law-enforcement, bodies know very well how
to do. This is their aim. We are not the first and not the last... 


[Q] Do you have any hope in the courts? 


[A] Of course, we have quite naturally appealed to the court now. 


[Q] Do you believe in their independence? 


[A] There are different judges. I have managed recently to convince courts
of various levels - from a District court to the Supreme Court - in cases
which had to some degree a political colouring, which had been to some
extent ordered from above. Just imagine, the courts did pass lawful and
grounded rulings. If we get a judge with a conscience, who will not break
the law blatantly, then we will win. But if we get a scoundrel, a person
who has been intimidated or broken... 


******


#10
The Globe and Mail (Canada)
17 June 2000
[for personal use only]
Canadians embroiled in Russian spy scandal
Secret police suspect universities' research
was cover for espionage; academics deny it
GEOFFREY YORK
Moscow Bureau


Moscow -- A Canadian academic study is embroiled in a Russian spy scandal, 
leaving a Moscow researcher languishing in prison on espionage and treason 
charges.


Igor Sutyagin was hired by a team from York University and Carleton 
University to examine military-civilian relations in Russia in a project 
financed by the Department of National Defence.


But Russia's secret police agency, the FSB, suspects the Canadian military 
actually wanted Mr. Sutyagin to seek out classified information from military 
experts he interviewed.


The two universities deny any espionage and warn that the allegations could 
have a chilling effect on academic co-operation between Russia and Canada.


The FSB, formerly the KGB, arrested Mr. Sutyagin last October, nine months 
after he completed the interviews for the Canadian project. He is still in 
prison in the central Russian city of Kaluga.


The FSB has not released details of the espionage charges. When it arrested 
Mr. Sutyagin, the FSB told the Russian media he had gathered secret 
information about Russian nuclear submarines. But later, the FSB began 
investigating his links to Canada.


The case is an example of the growing power of Russia's police and security 
agencies, which have harassed and arrested Russians involved in environmental 
work, anti-nuclear activism, nuclear weapons research and the independent 
media.


Mr. Sutyagin, 35, is a staff member of the Institute of USA and Canada 
Studies, a respected Moscow think tank. He was hired in 1998 to conduct 
interviews in Moscow for the team from York and Carleton. 
The academics were studying 12 post-Communist countries, including Russia, 
Ukraine, Bulgaria, Romania and Slovakia.


"I cannot believe that anyone, especially law-enforcement officials, might 
consider such work as espionage or treason," Michael Stevenson, 
vice-president of academic affairs at York University, wrote in a letter to 
the head of the USA-Canada Institute.


"I deeply regret the fact that of the 12 countries studied in this project, 
Russia is the only one where some officials seem to have found a Canadian 
study of civil-military relations to be a threat to national security."


In an interview, Mr. Stevenson said he was shocked by the turn of events, 
which he described as nonsensical.


"From what I know of the project, it is totally implausible. This is 
troubling -- that people on trumped-up charges can be accused of the highest 
treason and incarcerated."


The study was part of a broader program of Canadian assistance to defence 
officials in Eastern Europe and the former Soviet Union. Under the Democratic 
Civil-Military Relations Program, launched by the Department of National 
Defence in 1997, dozens of defence officials from post-Communist countries -- 
including Russia -- were invited to seminars and academic centres in Canada.


Canada thought it was being helpful to Russia in encouraging it toward 
Western-style civilian oversight of the military. The Russian military 
officers seemed to be enthusiastic participants in the visits, and Russian 
diplomats attended the Ottawa launch of a book that included Mr. Sutyagin's 
research findings last year.


But now it appears that the FSB was highly suspicious of the Canadian 
project, fearing an attempt at espionage. Pavel Podvig, an arms-control 
researcher in Moscow, says he was disturbed by the questions asked by FSB 
officials in their interrogation of Russians interviewed by Mr. Sutyagin.


"The FSB has been telling those people that rather than being an academic 
study, which it certainly was, the survey was actually carried out on the 
orders of the Canadian Department of National Defence, with the implication 
that it somehow constituted espionage," said Mr. Podvig, who has talked to 
Russian military officers interrogated by the FSB.


The FSB searched Mr. Podvig's office and apartment and seized his research 
materials last Oct. 27 -- the same day Mr. Sutyagin was arrested -- as part 
of a co-ordinated series of raids on Russian researchers. At the time, the 
FSB seemed mainly interested in their research on nuclear arms and security 
issues. Mr. Sutyagin and Mr. Podvig were co-authors of a recent book on 
Russian strategic weapons.


"They think Sutyagin was passing secret information to foreigners, but he 
didn't have any access to classified information," Mr. Podvig said in an 
interview.


"All he could pass on was open information. He was using his analytical 
skills to write papers. If we give the FSB the power to go around questioning 
every foreign contact and calling it espionage, we'll get what we deserve. 
The FSB could say that any academic study is treason and espionage."


York University political science professor Sergei Plekhanov, who drafted the 
questions used by Mr. Sutyagin in his interviews, said they focused on the 
role of civilians in the management of the armed forces, the role of 
parliament and regional governments in managing the armed forces, and the 
political attitudes of military leaders. The same questions were asked by 
researchers in all 12 countries.


"Our project does not stand out as anything new or extraordinary. The project 
was completely open. It never occurred to us that this could be construed as 
an attempt to peer into Russian military secrets," Mr. Plekhanov said in an 
interview. "It was designed to be helpful to the military leadership of 
Russia and other countries, to help them reorganize their armed forces."


The arrest of Mr. Sutyagin, he added, is part of a broader trend toward 
authoritarian rule in Russia. "There is a clampdown on academic research on 
matters of national security. There is a rising mood of distrust and 
suspicion of foreigners, and a tendency to isolate Russia from the outside 
world."


For almost eight months, Mr. Sutyagin has endured the hardships of an 
overcrowded jail. His wife, Irina, is restricted to two visits a month -- or 
even less.


"He is in bad physical and psychological condition," she said yesterday.


"At first he was in a cell designed for eight prisoners which held 28 people. 
He suffered from heat and lack of air. But for the past two weeks, he has 
been in a punishment cell . . . It's very cold there -- no heating, no 
electricity, nothing. His health has deteriorated. He had heart problems and 
now they have worsened."


She said FSB investigators have refused to give her, or his lawyer, any 
details of the charges. "I know only the official charges. Of course they are 
not true. I don't know what is behind all of this."


There are some parallels between the Sutyagin case and the persecution of 
Alexander Nikitin, a retired Russian nuclear submarine captain who was 
charged with treason and espionage after his research on nuclear waste in the 
Russian military.


Canada took a close interest in the Nikitin case because he was applying for 
a visa to visit Canada when he was arrested in 1996 and his wife later moved 
to Canada. He was eventually acquitted in court.


During a visit to Canada in early March, Mr. Podvig met Foreign Affairs 
Minister Lloyd Axworthy and told him about the Sutyagin case. The foreign 
affairs ministry has not made any official protests to Moscow, but is 
"monitoring" the case, a spokesman said.


"His work with Canada on civil-military relations was first-rate and 
reflected a longstanding theme of interests to Canada in Russia and other 
parts of Central and Eastern Europe," the spokesman said.


"After our long involvement with the Nikitin case, we're very sensitive to 
cases of wrongful charges of espionage and to interference by Russian 
security services in the judicial process."


******


#11
Washington Post
June 16, 2000
[for personal use only]
It's Time Russia Paid Its Debts
By Benjamin Gilman
The writer, a Republican representative from New York, is chairman of the 
House International Relations Committee.


The news coverage of President Clinton's visit to Moscow paid little 
attention to an agreement his administration struck with Russia--just nine 
days before the summit--to reschedule, for the fifth time, Russia's debts. 
With astonishing bureaucratic alacrity, the State Department dispatched 
notification to Congress of this agreement May 26, the very same day it was 
signed in Moscow. 


Russia is more unwilling than unable to honor its debts to the United States 
and other governments. Indeed, Russia has quietly been providing hundreds of 
millions of dollars worth of resources and finances to prop up the 
dictatorship of Alexander Lukashenko in Belarus. Last month Russia granted 
the Yugoslav regime of Slobodan Milosevic a loan of more than $100 million, 
and every year Russia pays rent estimated as high as $300 million to Cuba to 
operate an espionage facility used to spy on U.S. military forces, citizens 
and companies. For the past nine months, Russia has financed a brutal 
military operation in Chechnya costing hundreds of millions of dollars. No 
expense has been spared by the Russian government in carpet-bombing Chechen 
cities and rolling over innocent civilians in that bloody military operation.


Russia's finances are stronger then they have been for years. The rising 
price of oil, a major Russian export, has greatly replenished the Russian 
government's coffers. Loans from the World Bank and other international 
financial institutions continue to flow into Moscow, along with hundreds of 
millions of dollars in American Nunn-Lugar aid to help Russia meet its arms 
reduction requirements under the START I treaty. Through Nunn-Lugar and other 
programs--such as NASA Space Station contracts with the Russian Space Agency 
and purchases of uranium from the Russian Ministry of Atomic Energy--the 
United States alone has channeled hundreds of millions of dollars to the 
Russian government in recent years. Just last year, in an unprecedented move, 
the United States provided that government several hundred million dollars in 
revenues derived from the sale of U.S.-donated food in Russia to shore up 
Russia's pension program.


Given the propensity of Russian officials to "lose" such pension funds, that 
aid may not reach the intended beneficiaries and may instead end up in 
illicit bank accounts.


When the Soviet Union collapsed, Russia laid claim to Soviet banks, 
embassies, gold stocks and other assets. It also agreed to honor the Soviet 
Union's foreign debts. Regrettably, the Russian government has done little to 
keep its word. In fact, by February of this year, the London Club of 
commercial creditors was forced to write off more than $10 billion in Russian 
debt because Russia, for most of the past decade, simply refused to pay those 
creditors.


Meanwhile, the United States and other official creditors have already 
rescheduled Russia's debt at least four times during the past eight years, 
allowing Russia to avoid a lowered credit rating that would hamper its access 
to huge loans from the International Monetary Fund and international capital 
markets. The United States and other creditors have allowed Russia to forgo 
hundreds of millions of dollars in annual expenditures it would otherwise 
have had to make to honor its debts. We have gone beyond the point at which 
such leniency toward Russia on its debt obligations was justified. Russia's 
willingness to provide vital support to dictatorships, to kill thousands of 
innocent civilians in Chechnya and to flout its international commitments 
makes the wisdom of any further debt relief questionable. Nonetheless, 
Russian officials have made it clear that they expect the United States and 
other governments to act soon to provide not just rescheduling but outright 
forgiveness of over one-third of Russia's debts--a multibillion-dollar 
writeoff.


We must wonder when the Clinton administration will publicly acknowledge 
Russia's unwillingness to honor its commitments. Rescheduling Russia's debts 
allows it access to capital markets and loans that free up its resources to 
support dictatorships in Cuba, Belarus and Yugoslavia, to conduct a bloody 
military campaign in Chechnya, and to conduct extensive espionage against the 
United States.


A Russian default on its debts to the United States might well result in the 
loss of certain trade benefits we provide, but if such a default on its debts 
ended Russia's access to international capital markets alone, that would be a 
far more honest and transparent situation than the current one. As things now 
stand, the Russian government, through endless reschedulings, pays almost 
nothing and learns that not living up to its international commitments is met 
with not even a slap on the wrist.


******

Web page for CDI Russia Weekly: 
http://www.cdi.org/russia