Just hours after being transferred from a prison in New York to one in Geneva, former Kremlin aide Pavel Borodin was charged with money laundering by Swiss officials. Now, as Borodin's lawyers prepare for today's bail hearing, RFE/RL's Moscow correspondent Sophie Lambroschini reports speculation is mounting over whether Swiss justice officials can fight their own system to build an air-tight case against the well-connected Russian.
Moscow, 10 April 2001 (RFE/RL) -- After two years of investigation, Swiss prosecutors' efforts finally paid off. On Saturday (7 April), former Kremlin official Pavel Borodin was delivered to Geneva's Champ-Dollon prison and officially charged with money laundering.
The charge comes in connection with allegations that Borodin accepted $25 million in kickbacks in exchange for awarding lucrative contracts to two Swiss construction firms for renovation work on the Kremlin. The so-called Mabetex scandal, the name of one of the two Swiss construction firms, is one of the major corruption cases to emerge from Russia in recent years. But a growing rift within the Swiss justice system may mean the prosecutors' victory will be short-lived.
The Russian Prosecutor-General's Office, which conducted its own investigation into the matter, concluded that Borodin could not be charged with criminal behavior. Now, the "accusation chamber" -- the Swiss judicial body charged with overseeing investigative procedure -- says that if Russia sees no instance of corruption, the Swiss charges against Borodin are baseless.
Because the accusation chamber is also responsible for determining bail, Borodin's defense team has cause for optimism going into today's bail hearing. Lawyer Eleanora Sergeyeva outlined the arguments the defense would present at the hearing:
"The defense considers that [Borodin] was arrested in New York without a legal basis. The defense considers that the arrest warrant was issued without sufficient grounds. The defense considers that in this case there is insufficient proof that Borodin is involved. And that there was practically no infraction [to begin with] at all."
Borodin was arrested at a New York airport on 17 January after Swiss officials issued an international warrant for his arrest. But last week at the outset of an extradition hearing in New York, Borodin volunteered to go to Switzerland and face his accusers. Sergeyeva told RFE/RL that the accusation chamber's position was "one of the reasons" Borodin agreed to hand himself over to Swiss justice officials. She explained why the today's bail hearing could play a crucial role in the eventual outcome of the case:
"In principle, the court's decision on [whether to grant] bail does not legally influence the [final] judgment in the case. However, I do think that the reasoning the accusation chamber will state today [in its ruling] will say something about the court's attitude toward the case."
Borodin, who was appointed by then-President Boris Yeltsin to manage the Kremlin's vast property empire in 1993, stands accused by Geneva general prosecutor Bernard Bertossa and judicial investigator Daniel Devaud of receiving $25 million in kickbacks. The kickbacks allegedly came from two Swiss construction firms, Mabetex and Mercata, to ensure they were awarded renovation contracts in the Kremlin.
Bertossa made no comment today on the accusation chamber's possible impact on his hard-won case against Borodin. But he and Devaud have both argued that criminal corruption does not need to be recognized in Moscow if it is considered punishable under local Swiss law.
In an interview to RFE/RL earlier this year, Bertossa said that he had "indisputable documentary evidence [which] demonstrates that Mr. Borodin had 'commissions' paid to him." The Swiss prosecutor added that regardless of Moscow's position on the case, "under Swiss law, [Borodin's] behavior is a crime, and it is under Swiss law that money laundering in Switzerland is judged."
In an interview published 8 April in the Russian daily "Kommersant," Bertossa did express irritation with Russian prosecutors, saying that Borodin's case is "a first" in that the country in which the "crime [of corruption] was committed openly refuses to act."
Borodin's case has often been compared to that of Sergey Mikhailov, an alleged mafia boss whom Swiss officials hoped to make one of the first "Russian godfather behind bars." But in 1998, after spending some two years in Geneva's Champ-Dollon prison for allegedly belonging to an organized crime syndicate, Mikhailov was acquitted by a Swiss court -- and even received financial compensation from the authorities. Russian and Swiss media have speculated that the utter failure of the Mikhailov case has put additional pressure on the Swiss prosecution to secure a conviction this time around.
The Mabetex case repeatedly made headlines in Russia two years ago as Swiss investigators and then Prosecutor-General Yury Skuratov implicated first Borodin and then Yeltsin's closest friends and even his daughters. Clearly unnerved by the political ramifications of the case, Kremlin insiders repeatedly said the case was invented by Yeltsin's opponents.
Russian media speculated the Yeltsin regime feared that charges against Borodin would compromise both the past and present political leadership.
Although Borodin was hired by Yeltsin, he also has strong links with current President Vladimir Putin. It was Borodin who first brought Putin into federal politics in 1996, when Putin -- then an official in the St. Petersburg mayor's office -- joined Borodin's Kremlin property committee. As Borodin's deputy, Putin was responsible for managing former Soviet real estate, worth millions of dollars, in 78 different countries.
Shortly after becoming prime minister in 1999, Putin told Russian television that he credited Borodin with his move to the Kremlin.