| JRL HOME | SUPPORT | SUBSCRIBE | RESEARCH & ANALYTICAL SUPPLEMENT | |
Old Saint Basil's Cathedral in MoscowJohnson's Russia List title and scenes of Saint Petersburg
Excerpts from the JRL E-Mail Community :: Founded and Edited by David Johnson
#21 - JRL 9200 - JRL Home
Moscow News
www.MN.Ru
July 13-19, 2005
One Man's Fight against Extortion System
How much does it cost to drop a criminal case?

By Igor Korolkov

Corruption in Russia is reaching alarming proportions. State and government agencies are doing almost nothing to fight it. The Interior Ministry is sitting on its hands.

This assessment of the situation comes from a recent report by RF Prosecutor General Vladimir Ustinov.

He periodically makes such statements, so one could get the impression that Ustinov is probably the only high ranking state official who is trying to stand up to the higher echelons of power, while his agency is the last buttress in the fight against corruption.

The following story paints a different picture, though.

It happened to Nikolai Nikitenko, ex-CEO of the OAO Vladivostok Trawler and Refrigerated Cargo Fleet. Nikitenko writes in his letter that in 1998 he had to leave Russia, "unable to cope with the criminal free-for-all on the part of both the state apparatus and individual thugs, fearing for my life." Here is his story.

Sixty Volumes for $5 Million

In April 1998, criminal proceedings were opened against me - on abuse of office charges. Soon afterwards, a man called me on the phone, saying he represented the interests of the Vasilenko agency. The 'Vasilenko agency' is the Maritime Krai Prosecutor's Office, while Vasilenko is the krai prosecutor.

The caller said he had been directed to talk over a sum in exchange for which the criminal case against me would be dismissed. The representative of the 'Vasilenko agency' asked for $1.75 million. I refused to cut a deal with him and then received a threat: If I did not pay the required amount, I would be put on Interpol's wanted list.

Three days later the same man called again, citing a lower price - $750,000.

My Russia-based lawyer convinced me that it was useless seeking justice in Russian courts. I paid the lawyer who, I understood, paid the intermediary. The case was dropped.

Ten days before the statute of limitations on my purported criminal case, which was opened in 1998 and closed in 1999 under an amnesty, ran out, I got a call in the United States from a person who introduced himself as Anatoly Vasilyevich Levitsky, a lawyer. His demand stunned me: pay $5 million, $1.5 million of which would go to him for mediation and $3.5 million, as he put it, to 'a very high-ranking official at the Prosecutor General's Office.' Should I pay that sum, the extortionist said, the case files - in all, 60 volumes, kept at the PGO Far East Federal District Office - would be handed over to my representative. I cut short the telephone conversation rather abruptly.

Soon after that, I was faxed a copy of an article published in a local newspaper. The press secretary of the Krai Prosecutor's Office stated that the PGO had initiated criminal proceedings against me and my son (he left Russia in 1992) and that we were being put on the international wanted list.

Under FSB Control

I had to turn to the Federal Security Service (FSB) Directorate for Maritime Krai. Sergei Vasilyevich Kovalenko, head of a department; and his deputy, Vladimir Ivanovich, took on the case so I conducted all subsequent negotiations with the extortionists under their supervision and on their recommendations. I taped all telephone conversations. As far as I know, the FSB Maritime Krai Directorate was doing the same.

The first person to call me after I had gotten in touch with the FSB was a man who introduced himself as Nikolai Nikolaevich Palukho. I know that the chief bailiff of Maritime Krai has the same family name, first name and patronymic, but I cannot assert that it was in fact he who was extorting a bribe. To be able to say this for sure, it is necessary to conduct an expert appraisal of the recording and identify the recorded voice."The man who said he was Palukho promised, in return for about $4 million, to deal with my problem expeditiously and conclusively. He said he would do that with the help of the chairman of the Krai Court and the Krai prosecutor. Following instructions from the FSB officers, I started to bargain.

After Palukho, I was contacted by a certain Oleg Bystritsky. In addition to taping our telephone conversations, I corresponded with him by e-mail.

Following are two noteworthy letters.

From: ost-inw1358 To: nikolay@globalsea-foods.com

Sent: Friday, January 09, 2004 1:08 AM

Nikolai Ivanovich,

I have just talked with Sanin (he called me himself). They have revisited your case, studying the possibilities for closing it. They said they could close it finally with 100 percent guarantee. But the case is very complicated and the sums involved are very large. The entire procedure will take less than a month. They will be able to specify the time frame in a week.

The breakdown is as follows: $1 million goes to Kolmogorov, $400,000 to the investigator in charge of the case, and $200,000 to Sanin.

Oleg.

From: ost-inw1358 To: nikolay@globalsea-foods.com

Sent: Tuesday, January 13, 2004 4:01 PM

Hi, Nikolai Ivanovich,

The following procedure is proposed. We go to a bank and put the money - for myself, Igor, and Evgeny Mikhailovich Sanin - in a safe deposit box (this has not only been talked over with them, but is their express demand). One key will be held by your man and one by myself.

After this your man will have a meeting with the representative of the Prosecutor's Office he will be working with; the same procedure will be used in putting their money in a bank safe deposit box. Your man will hold one key and the PGO representative will hold another.

Now about the remuneration for myself and Igor. Igor wants to get $200,000, while I would be content with just $100,000.

Thus, $500,000 will be placed at one safe deposit box and $1.4 million at another.

Why go to such great lengths? The reason is that Sanin doubts that he will be able to get anything if all of the money goes to the Prosecutor's Office. He has had such a precedent before.

Once everything has been done, the documents will be handed over to your man who will check their authenticity, and only then the safe deposit boxes will be opened and the money transferred.

Oleg.

I was meticulously forwarding all of this correspondence to the FSB Maritime Krai Directorate.

The FSB officer in charge of my case said that they were not interested in small fry like an investigator at the Maritime Krai Prosecutor's Office or officers at the PGO Far East Office. They wanted to catch big fish. Apparently something was really up:

I sensed this from the recommendations that the FSB men were giving me. At last Kovalenko flew to Moscow. Soon after that I received an e-mail from him. It was, as usual, Aesopian in style: 'Contract' meant 'bribe.'

From: luminofor@mail.ru

To: nikolay@globalsea-foods.com

Sent: Thursday, January 29, 2004 9:09 PM

Attachment: denial.doc

Subject: Re

Hi, Nikolai,

You may now immediately cut off all relations. Unfortunately, the contract in its final form failed to materialize, but thanks to our joint efforts, unscrupulous business players will now be unable to operate anymore.

Sergei.

After this letter I realized why RF Deputy Prosecutor General Kolmogorov had been dismissed so expeditiously.

Patrushev's Silence

I believe that officers at the FSB Maritime Krai Directorate are decent guys who faithfully performed their duty. It was simply that at times they found themselves out of their depth. This is none of their fault.

Yet there was one thing I could not quite figure out: If it is impossible to nab a ranking PGO official in Moscow, why not go for lower ranking corrupt officials - for example, in Khabarovsk or Vladivostok? It was not until later that I finally grasped the real problem. Even if "small fry" is nabbed, they may still lead on to their bosses.

I wrote to FSB Director Vladimir Patrushev. I told him about our cooperation with his subordinates, asking what I should do since I had once again been asked to pay $2.8 million in exchange for the criminal case against me being closed.

Patrushev never replied.

Thus I was left one on one with the state extortion system.

Resistance Useless, but Not Entirely Meaningless

The documents that Nikolai Nikitenko presented to this newspaper give cause to believe that he was indeed the target of a "money-for-amnesty" extortion racket. And although the FSB Maritime Krai Directorate refused to comment on Nikitenko's asserted cooperation with the state security service, all the indications are that the ex-CEO of the OAO Vladivostok Trawler and Refrigerated Cargo Fleet is not being disingenuous.

In making public this story we do not expect that some state agency will seriously investigate the extortion racket against Nikolai Nikitenko. This is only to provide a warning once again: Corruption has eroded the state to such an extent that there are no agencies left that can stand up to this sort of evil.

.