Audit Chamber head Sergei Stepashin was much quicker to condemn Abramovich's purchase publicly, and this week and last Stepashin and his lead auditor investigating Abramovich's management of Chukotka's finances revealed the findings of their three-month audit. Auditor Sergei Ryabukhin announced on 21 May that the okrug is bankrupt. According to Ryabukhin, the region's debt exceeded 9.3 billion rubles ($320 million) as of 1 January, while revenues amounted to only 3.9 billion rubles in 2003, "Gazeta" reported on 24 May. The audit found that illegal expenditures amounted to 1.09 billion rubles in 2003 and 23.5 million rubles in 2004, ITAR-TASS reported. It also found that the okrug administration illegally raised the salaries of local officials and public-sector employees during 2003, and as a result wages for local bureaucrats exceeded those of their federal counterparts by more than 5.6 million rubles.
Responding to the findings, Stepashin called on Abramovich to step down. "Looking at the results of the audit, I can say that Abramovich has let down the president badly," Stepashin told Interfax on 23 May. In an interview the previous day with "Rossiiskaya gazeta," Stepashin compared Chukotka's financial violations unfavorably with Chechnya's. He said auditors found that Chechnya had misspent almost 800 million rubles, but noted that Chechnya is experiencing war. Chukotka, on the other hand, has a population of only 52,000. He also noted that Ingushetia had fewer violations of financial discipline than Chukotka even though that republic had to cope with an influx of refugees across its borders. However, by 25 May, in an interview with the same newspaper, Stepashin had tempered his criticism of Abramovich. Stepashin said that he did not understand why this particular investigation has produced such a storm of publicity, especially since the chamber has uncovered far greater violations in Chechnya.
Stepashin had tried and failed to come up with enough evidence to launch a criminal case against Abramovich, "Kommersant-Daily" concluded on 22 May. As a result, Stepashin faced a choice -- avoid losing face or risk severely defaming his political opponent, "Nezavisimaya gazeta" commented on 20 May. (Both newspapers are owned by Abramovich's former business partner Boris Berezovskii.) According to "Nezavisimaya gazeta," of the more than 1 billion rubles that were illegally spent in 2003, only around 200 million rubles can be held against Abramovich and his subordinates. According to "Gazeta" on 24 May, the okrug's debts started mounting years before Abramovich took office. For example, the region took out a credit worth $190 million in 1994-95.
According to "Izvestiya" on 20 March, an audit conducted by the Audit Chamber in the late 1990s revealed substantial financial improprieties in the operation of a Chukotka Development Fund set up by Abramovich's predecessor in Chukotka, Aleksandr Nazarov. Documents were transferred to the Prosecutor-General's Office but no criminal case ever materialized. Nazarov subsequently went to work for the Audit Chamber, and "Izvestiya" commented it might be time to toughen the law on the appointment of auditors, as it is currently easy to appoint people who have a "dubious credit history."
Asked why Stepashin appeared to be trying to scare Abramovich, Vyacheslav Nikonov, president of the Politika Foundation, told "Kommersant-Daily" on 21 May that Stepashin has "personal grievances" against Abramovich. "He has voiced them on several occasions both with regard to the purchase of the Chelsea soccer team and the fact that Sibneft pays the least amount of taxes of all of Russia's oil companies," Nikonov said. "But this does not mean that storm clouds are gathering over Abramovich. In the regime's view, he is behaving positively. And if Sibneft pays more tax, there will be no complaints." Arkadii Murashev, president of the Association of Mortgage Banks, had an alternative explanation for the animosity between Stepashin and Abramovich: "Perhaps Stepashin is simply an Arsenal fan."