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Russia: IMF Unaware Of Central Bank's Off-shore Funds

Washington, 11 February 1999 (RFE/RL) - An International Monetary Fund (IMF) spokeswoman says the fund did not know about the Russian Central Bank's creation and use of a private off-shore firm to handle some of its foreign reserves. She says the IMF is seeking more information on what was done.

Central Bank Chairman Viktor Gerashchenko was quoted by the Moscow Times today as acknowledging that the bank created a private company named FIMACO on the Island of Jersey, off England, to handle what is alleged to have been around $50 billion dollars in foreign funds, including some from IMF loans.

The newspaper quoted Gerashchenko as saying the company was set up to avoid seizure of assets when Russia was in "difficult negotiations" with its foreign creditors on de facto defaults.

Hiding assets from creditors is considered fraud in most western countries, where Central Banks always handle their own funds.

Allegations of FIMACO's involvement surfaced in a letter from former general prosecutor Yury Skuratov to Duma members.