Illegal Foreigners Run Billion-Dollar Deals at Russian Banks

Foreigners use Russian financial system to obtain profit

The money issue, the issue of the capital outflow and of the improvement of the financial situation in the country are directly linked with the general state of things in the Russian economy. Specialists are perfectly aware of the things that might seem to be shocking for a common person. This does not make the situation easier, though. There is no recipe, which can help to let market economy vices go, no matter where they might occur – in the United States of America, in Switzerland, or in Russia. The level of damage directly depends on the general level of the economic mess. Needless to mention that Russia goes in advance when it comes to the problem of mess.

The Russian state machine works in a very bad and inefficient way. The administration of the Russian Federation president has to deal with the improvement of the financial situation in the country as well, not to mention such profiled departments as the Finance Ministry and the Central Bank. The presidential administration deals with those problems, but it deems that those activities do not bring any result.

Federal fiscal bodies (which have been recently re-organized by President Putin) held a session in Moscow today. Viktor Ivanov, the deputy director of the presidential administration, exposed very interesting information at the session. As he said, natural non-resident persons cashed almost ten billion American dollars at Russian banks last year. It is impossible to trace that money afterwards. What was it spent for? It is not ruled out that it was used to fund Chechen terrorists so that they could prepare new acts of terrorism in Russia. It seems that Russian state bodies can not say anything definite on the subject.

Furthermore, foreign citizens use the Russian financial system for getting their own profit from it. The mentioned official said that foreigners used Russian banks for conducting their deals that totaled about 300 billion rubles. It does not go about legal investors, stags, and the like here. Those operations are conducted by the people, who do not attract any attention in Russia – migrants. The Russian government has been trying to legalize them, although there has been no success achieved yet. To be more precise, it goes about citizens of Ukraine, Azerbaijan, other CIS countries, China, Korea, Vietnam.  They are all either vendors or workers, basically.

It deems that the state is not very well aware of the real scale of their activities. This brings up a question pertaining to the efficiency of the struggle with money-laundering. However, Russian officials have their noses in the air: since FATF struck Russia out of its black list, it means that the struggle is on. Viktor Ivanov, deputy director of the presidential administration stated that “the origin of those funds is not known.” According to his opinion, there is a reason to believe that a considerable part of that money is implicated in organized crime. The official also acknowledged that the scale of the Russian criminal level is a real factor, which affected the economic security of the state.

It was very pleasant to hear such a statement from a person, whose takes such an important official position in the country. However, there is no need to read Russian newspapers every day in order to be able to understand that it is also a factor, which allows thousands of various officials (including police chiefs, even common police officers) to live on their meager wages. Maybe, there is no need to try to find out, where those billions were gone. It is not excluded that  they are now owned by bribe-takers, or were spent on apartments, cars, country houses, trips abroad, mink coats for wives and so on. At least, neither officials, nor police officers have died of hunger yet.

There is bitter irony about the fact that an official from the major administrative department of the country said that to the employees of the re-organized fiscal department, which tried to struggle with all that mess. From now on, the function of the cash flow control in Russia will be fulfilled by the financial monitoring committee that is attached to the Russian government. Viktor Ivanov also said that vesting the functions of the fiscal police to the Home Ministry would help to struggle with economic crimes in a more efficient way. One shall assume that the fiscal police existed in vain. This is so very in the Russian way – to fire people and to spit in their faces at parting.

Kira Poznakhirko

Translated by Dmitry Sudakov

Author`s name Olga Savka