ISSN 2330-717X

A Tale Of Corruption Without Redemption – OpEd

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Russia’s coal-mining Kemerovo Oblast has long had a reputation for corruption and government interference in regional business affairs, but until recently no major figures were ever held accountable. However, rare public outrage erupted after a mall fire led to the deaths of at least 64 people, including 41 children, forcing the region’s long-term governor, Aman Tuleyev, to resign from his position. Rampant corruption throughout the regional administration has been blamed for the devastating mall fire in Kemerovo city, as commentators have cited inadequately equipped firefighters and police as well as a weak response from the government in the aftermath.

Tuleyev, who had been Kemerovo’s governor for 20 years, found himself in the spotlight during the wide-spread protests against incompetent and corrupt officials following the blaze. Although he claimed his resignation was motivated by the fact that “one can’t work as a governor with such a heavy moral burden”, experienced Russia watchers consider it likely that President Vladimir Putin forced Tuleyev out of office in a carefully calculated move, allowing the Kremlin to calm the situation without giving the impression it had yielded to public pressure. At a time when the corrupt activities Russia’s elites often partake in have increasingly come under scrutiny, the mall fire represented an opportunity for Vladimir Putin to publicly highlight his own anti-corruption campaign.

The people of Kemerovo are now demanding that local officials and mall operators be held responsible for the accident, and Putin is at least paying lip service to their calls for justice. As an angry crowd gathered, Putin blamed the fire on “criminal negligence” and greed. Putin has a point—during the investigation into the disaster, it emerged that the mall’s managers had replaced experienced workers with less experienced ones, and reduced staff numbers across the board to slash costs. The number of security guards in the shopping centre was also found to have been cut from seven to just three.

The probe has also pointed to cut corners during the mall’s construction. Its fire alarm system failed to activate, and safety doors remained shut, causing mall visitors to get trapped in the fire. In fact, the Ministry of Emergency Situations stated that the building’s permit request was rejected in 2013 due to fundamental safety failings. That the mall was able to open despite these shortfalls can be chalked up to the city’s deputy mayor’s acceptance of a bribe in return for the mall’s 2013 inauguration going ahead as planned, according to Anton Gorelkin, a State Duma deputy from Kemerovo.

A mall executive was hastily arrested for failing to address these glaring safety issues, but the blame for the fact that the rampant corruption penetrating all levels and sectors of society has been able to strive lies largely on Tuleyev’s shoulders. After all, it was under his two-decade rule that the Kemerovo region acquired its notorious reputation as a hotbed of lawlessness. In fact, the deadly failure to adequately enforce safety standards at the local mall is not the only thing that has placed Tuleyev on the radar of the international press.

Five years ago, he was at the centre of another corruption-charged controversy that exposed both the methods used in the expropriation of a British investment firm, and his links to Russian billionaire Alexander Shchukin. In 2013, Igor Rudyk, the Kazakh CEO of British firm Lehram, was detained on Tuleyev’s orders for holding an expired international passport. Only a few months earlier, Lehram had bought the Gramoteinskaya coal mine in the Kemerovo Oblast town of Belovo. After Rudyk’s arrest, the mine was plunged into a crisis: its foreign staff were rebranded “imposters”, and wages suddenly fell into arrears. During a special meeting, Tuleyev allegedly ordered the mine transferred to a company controlled by coal magnate Alexander Shchukin. Under threat of spending time in a Siberian prison, Rudyk signed the mine over.

Lehram is now fighting for the return of the mine and $500 million in damages, arguing that the asset was stolen with the support of the local administration. Significantly, Lehram argues that this move violated a Russian-British bilateral treaty that guarantees the protection of foreign investments in Russia. Kemerovo officials’ conduct during the ordeal was described by Lehram’s representatives as one of the “most blatant cases of unlawful state expropriation” to have taken place in recent years. Since the case was not resolved within the stipulated three months since its filing in December 2017, Lehram is now preparing an international arbitration process in The Hague against Russia for violating the bilateral investment protection agreement.

The looming international court battle has sparked a minor bilateral crisis, highlighting once more the troubling links between Russian political and economic elites and their lavish lifestyles in the UK. Like most other Russian oligarchs, Shchukin’s family enjoys a lavish lifestyle in London. Shchukin’s daughter, married to Shchukin’s business partner Ildar Uzbekov who himself holds managerial positions in many British firms, also owns an art gallery in London’s Mayfair district and a mansion in Highgate, according to the Guardian.

The paper also states that Uzbekov “has a clutch of directorships in Britain”, having recently acquired “the UK’s largest ethical energy broker”. But Uzbekov’s business dealings go beyond the UK. Along with Elena Shchukina, Uzbekov is director of Braynkee Holdings Limited, Cypriote offshore company, according to Cyprus’ registrar department. Italian media reported that Uzbekov along with his business partner Dmitry Tsvetkov (also of British citizenship) use the offshore company for the control of the coal mine illegally expropriated from Lehram. Both partners are also allegedly running a “pension fund” on behalf of a group of Russian oligarchs.

Yet despite the ongoing international arbitration and his links to Shchukin, Tuleyev has somehow managed to stay afloat. A mere eight days after his supposed capitulation and resignation, he resurfaced and was elected as speaker of the Kemerovo regional legislature. Winning a sweeping vote of 38-1 in the legislature, presently dominated by the Kremlin-controlled United Russia party, Tuleyev’s ability to retain power seems rather undiminished.

For the protesters demanding a change in governance that curtails corruption and elite excess, as vowed by the Kremlin, this development does not bode well. With mistrust in Kemerovo’s government reaching new heights after the fire, the people are in for an uphill battle. In the words of one protester, “No one is going to be really punished for this,” because “we’ve had that many times before.” As Kemerovo prepares to bury its children, he is probably right.

*Steven Baxter, is a UK native currently pursuing studies in Zurich with a focus on post-Soviet politics and Eastern European political economy.


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