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Russia: Kremlin Aide Attacks Opponents And Denies Corruption

  • Floriana Fossato



One of the key figures in the controversy over allegations of corruption in the Kremlin is the head of its presidential management department, Pavel Borodin. Borodin spoke with RFE/RL's Russian Service late on Friday about the controversy. RFE/RL's Floriana Fossato sends this report from Moscow.

Moscow, 30 August 1999 (RFE/RL) -- The Kremlin, despite a stated lack of concern, has begun responding to allegations published last week in an Italian newspaper of corruption by President Boris Yeltsin, members of his family and inner circle.

The powerful head of the presidential management department, Pavel Borodin, has told RFE/RL that he never opened a bank account in Switzerland as claimed by "Corriere della Sera". The paper alleged last week that the account channeled one million dollars for Yeltsin and his family from a Swiss construction company, Mabetex.

During the last six years, the company has won more than $100 million in contracts for the renovation of historical Kremlin buildings.

The newspaper wrote two days ago that Mabetex boss Behgjet Pacolli, paid credit card bills for expenses incurred by Yeltsin and his daughters, Tatyana Dyachenko and Yelena Okulova. Pacolli (Aug. 26) denied the allegations, calling them "lies." He told Reuters news agency that Mabetex was the "victim of political games between Russians -- the opposition and the presidential administration."

However, the New York Times reports that in an interview earlier this year Pacolli said he had set up a bank account to guarantee a credit card that Borodin used during his trips to inspect materials.

In his interview with RFE/RL's Russian Service, Borodin called the controversy a "curious situation".

"[Pacolli] should answer how he opened accounts, where and why he did so. I did not open those accounts. I do not have them. There is no movement in the accounts, on the cards, there are no slips [corresponding to operations conducted] with the cards. There are no payment orders with my signature. This simply does not exist."

At the beginning of the 45-minute-long interview, Borodin showed disdain for the allegations, which he said were the result of "political fabrications" ahead of key parliamentary and presidential elections in Russia.

"I even know who orders these materials, how much was paid [for the publication.] Simply, this is not interesting to me. I never wage wars with anybody, let alone with these scoundrels."

Later in the interview, he lashed out at Russian political figures whom he identified only as "candidates for the presidency, of low cultural and political level." He seemed to accuse the unnamed politicians of lacking gratitude to Yeltsin, who, according to Borodin, in the past showed them his benevolence.

"Not so long ago these candidates, during Yeltsin's term, were awarded by the president orders, titles, posts, rewards. Some of them received them 3 times per year, even if Russian legislation allows one such award every three years."

The allegations in "Corriere della Sera" follow months of inquiry carried out by the Russian and Swiss prosecutors offices into Borodin's relations with Mabetex. Borodin acknowledged that he made several trips to Switzerland at the company's expense. However, he says this was part of an agreement between the company and the presidential management department.

"In the first place, relations with Mr. Pacolli were regulated by agreements that the presidential management department concluded with Mabetex. These agreements clearly state that, when our delegation was in Switzerland, expenses were covered by Mr. Pacolli. I was in Switzerland three times during six years of common work. [And, according to the agreement] when Mr Pacolli was in Russia -- and he was here [many] times, the Russian side covered expenses. This includes accommodation, food and air flights and was in the agreement between the presidential management department and Mabetex."

Borodin says that Russian delegations of 3-5 people including him used to travel to Switzerland -- and to other countries where companies that concluded agreements with his department were based -- to inspect orders. He said such trips took place about five times per year and expenses were usually covered by the foreign partner.

The presidential management department is a powerful agency employing thousands of people. It oversees vast amounts of federal property, including the Kremlin, office buildings, apartment complexes, hotels, country residences, as well as planes and a fleet of cars serving state officials.

Borodin said that Mabetex was just one of 134 Russian and foreign companies that his department works with. He says Mabetex, through tenders "won contracts for no more than $30 million yearly." He noted that this is just a fraction of the presidential management department's investment volume, which "reaches $1.5 billion per year."

During the interview, Borodin also had harsh words for Switzerland's former prosecutor Carla Del Ponte. Solicited by Russia's suspended prosecutor general Yuri Skuratov, she opened an investigation into accounts held in Swiss banks by Borodin and other influential Russian officials.

Del Ponte has the reputation of tough corruption fighter in Switzerland and abroad. She was recently appointed chief justice of the International War Crimes Tribunal in The Hague. Borodin alleges that del Ponte's interest in Russian corruption was a career move.

"There are investigations on which one can build a career. This is the case with Carla del Ponte. She made a career, now she works at the UN and will accuse [Serbian President Slobodan] Milosevic."

Besides Borodin, other Kremlin officials also denied (Aug. 26) that Yeltsin and his family had received bribes from Mabetex. Western and Russian news agency quoted an unnamed Kremlin spokesman as saying that "in connection with publications in certain media, we would like to remark that the president of Russia, his wife and his children, have never opened accounts in foreign banks."

Russian law does not allow citizens residing permanently in the country to hold accounts in foreign banks without the Central Bank's permission.

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