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Russia: Swiss Looking Into Moscow's Use Of IMF Funds

Swiss officials have confirmed they are formally investigating whether a part of a $4.8 billion loan from the International Monetary Fund (IMF) to Russia was diverted through Swiss banks and misused. RFE/RL's Sophie Lambroschini reports from Moscow.

Moscow, 25 July 2000 (RFE/RL) -- Swiss investigators are in the process of tracking part of an IMF loan to Russia that is suspected of having disappeared into several secret Swiss bank accounts.

Their effort is part of a formal inquiry opened last year into possible money-laundering by the U.S.-based Bank of New York. Laurent Kasper-Ansermet, the chief Swiss investigator, told RFE/RL's Moscow correspondent that he is looking into what happened to the IMF money but cannot make public any of his findings yet:

"I carried out banking probes in the framework of the IMF loan installment affair that touched the Bank of New York. I can't say more. I need to continue my investigations before being able to give other elements publicly."

Kasper-Ansermet told the Reuters news agency that his inquiry centered on several banks in the Swiss Italian-speaking canton of Ticino. Reuters says that 10 days ago he asked these banks for information and documents on whether they had handled any diverted IMF money. The agency quoted Kasper-Ansermet as saying he had "some information on possible Swiss links to the Bank of New York affair." But he declined to elaborate either to Reuters or to RFE/RL.

His remarks follow a recent request for banking information from Swiss banks on any links they might have had with the Bank of New York. As head of the Swiss investigation, he has already frozen $18 million deposited in more than 10 Swiss banks.

According to Italian and Swiss newspapers, Kasper-Ansermet is trying to hunt down part of a $4.8 billion IMF installment to Russia authorized in July 1998. The Italian daily "Republica" says the money left the U.S. Federal Reserve's, bank, but then -- instead of going to the Russian central bank -- was laundered, disappearing in secret accounts without ever reaching Russia. The paper suggests the money could have been stolen by Russian officials. Other press reports suggest similar schemes, but with different banks.

While the Swiss prosecutor confirmed he was looking into the IMF loan, he refused to specify any amount. He told our correspondent: "It's too early in the investigation to be precise."

The Swiss probe is part of a larger probe into the Bank of New York -- one of the U.S.'s oldest and largest banks -- which is suspected of being a conduit for Russian organized crime money-laundering. The official investigation began last year.

At the time, press reports suggested that $200 million may have been funneled through the Bank of New York before disappearing in secret Swiss accounts. Kasper-Ansermet has requested information from U.S. officials, but recently publicly regretted that he had not received an answer.

Britain's Financial Times reports that the IMF has rejected allegations that the money was spent improperly. The paper quoted a spokesman as saying the IMF is not familiar with the Swiss investigation.

The IMF 1998 loan now under scrutiny was part of a $22.6 billion aid package aimed to boost the Russian economy. The July 1998 installment was meant to beef up the Russian central bank reserves and stabilize the ruble. But the money did not help. The ruble crashed in August 1998, plunging Russia into a financial crisis.

The current alleged Russian improprieties with IMF money would not be the first to strain relations with the fund. Last year, the IMF scolded Moscow for what it termed "lying" in its official data to the international lender.

The IMF said Russian authorities misled the fund in 1996 on its reserves as a result of the Russia's central bank's transactions with an off-shore company on the Channel island of Jersey, the Financial Management Company.

Later, former Russian Finance Minister Mikhail Zadornov admitted that Moscow artificially raised its foreign reserves and gave false figures to the IMF. That development further soured the IMF's attitude toward Russia that had deteriorated after the 1998 financial crash, when Russia ran up a debt of about $15 billion to the fund.