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Reaping The Harvest: Siberian Prison Channels Millions To Local Lawmaker's Firms


In addition to being an entrepreneur, Gleb Popovtsev is a deputy in the Novosibirsk Oblast legislature from Russia's ruling United Russia party.

MOSCOW -- Novosibirsk's maximum-security prison No. 2 (IK-2) is a cheerless, daunting place that is home to just over 2,000 hardened criminals, most of them repeat offenders.

A gray, urban prison on the edge of Russia's third-largest city with virtually no arable land, it would seem an unlikely place to find a thriving farm. But judging by some strange patterns in the prison's publicly documented tenders, that's exactly what one might expect to find.

In May, for instance, IK-2 signed two contracts with a firm called Yarkovskoye to purchase grain and vegetable seeds for 13 million rubles ($219,000). Strangely, the contracts called for the firm to deliver the seeds to itself, in the village of Yarkovskoye, about 35 kilometers from Novosibirsk. Weeks later, the prison concluded two contracts for the firm Sibirskiye Ovoshchi to plant the seeds, for the sum of 13.4 million rubles.

The contracts are also strange for other reasons. First, the planting season in western Siberia ended in May. Second, both Yarkovskoye and Sibirskiye Ovoshchi belong to the same man: Gleb Popovtsev. In addition to being an entrepreneur, Popovtsev, 46, is a deputy in the Novosibirsk Oblast legislature from Russia's ruling United Russia party. He's the deputy chairman of the Agriculture and Natural Resources Committee and a member of the legislature's Anticorruption Commission.

According to an investigation by Aleksei Fedyarov of the nongovernmental prisoners' rights group Russia In Prison, since 2011 (when information about state tenders became publicly accessible) IK-2 has signed noncompetitive contracts worth more than 400 million rubles ($6.8 million) with companies tied to Popovtsev.

Fedyarov emphasizes that the state-tender records do not indicate if any crops or other results came from the contracts, or what might have happened to any that did. It is possible that some of the produce ended up on the plates of the prisoners or were sold for the benefit of the prison. But it is equally possible that the contracts produced nothing, he says.

Both IK-2 and Popovtsev's office declined requests for interviews for this article.

According to one NGO, the prisoners of Novosibirsk's maximum-security prison No. 2 (IK-2) are not seeing much of the produce, if there is any.
According to one NGO, the prisoners of Novosibirsk's maximum-security prison No. 2 (IK-2) are not seeing much of the produce, if there is any.

Signing Deals, Closing Down

Russia's Federal Penitentiary Service (FSIN) ranks sixth among government entities in terms of funding. Its 2017 budget was almost 247 billion rubles ($4.2 billion), or about 40,000 rubles ($675) per prisoner per month. "The prisoners do not see this money," Fedyarov tells RFE/RL. "Russia In Prison is constantly sending care packages to the prisons with basic necessities like food, tea, clothes, and so on."

Popovtsev's close business ties to IK-2 have been facilitated by Artyom Yevseyenko, the prison's director since July 2016. Yevseyenko has been signing contracts with Popovtsev's firms since at least 2011 (when public-tender records began), when he was deputy head of IK-2.

In May alone, Yevseyenko signed contracts with Popovtsev's companies worth 54 million rubles.

In 2012, Yevseyenko was transferred to become the head of penal colony No. 22 in Novosibirsk Oblast. During his short tenure there in 2012-13, Yevseyenko signed 13 contracts with Ovoshchevod, another Popovtsev-owned firm, and 21 contracts with Yarkovskoye. The contracts were worth about 73 million rubles. However, after Yevseyenko was transferred back to IK-2 in 2013, penal colony No. 22 stopped signing contracts with the two firms and Ovoshchevod was liquidated shortly thereafter.

In fact, liquidation is something of a theme running through Popovtsev's dealings with IK-2. In early 2015, he registered a firm called Altair and, before the year was out, that company signed 18 contracts with IK-2 for just over 46 million rubles. Then it went out of business. He founded Ovoshchevod in 2012, and in 2013-14 he signed 59 contracts with IK-2 for over 106 million rubles. In 2015, that firm was officially moved to Altai Krai and within six months had been closed down. In 2015, Popovtsev founded a firm called Selkhoztorg; it concluded 11 contracts with IK-2 worth at least 34 million rubles before it was transferred to the very same address in Altai Krai in January 2016 and closed down eight months later.

Gleb Popovtsev's close business ties to IK-2 have been facilitated by Artyom Yevseyenko, the prison's director since July 2016.
Gleb Popovtsev's close business ties to IK-2 have been facilitated by Artyom Yevseyenko, the prison's director since July 2016.

Fedyarov explains that moving a firm to another region is a common way of hiding documentation relating to state contracts and other accounting. "Altai Krai is well-known for the in-migration of such firms which are used for liquidating assets," he explains. Existing records suggest that none of Popovtsev's firms possessed the assets or resources necessary to fulfill the contracts they signed, he adds.

Evading Prosecution

Although Popovtsev was not a member of United Russia, the Kremlin-controlled political party that has dominated legislative and executive power in Russia since 2001, he entered the Novosibirsk Oblast legislature on the party's ticket in July 2015. His election came just as he was being caught up in a local scandal involving the alleged embezzlement of 7.2 million rubles and the possible illegal takeover of a firm called OST.

According to documents in RFE/RL's possession, Novosibirsk police investigators several times asked prosecutors to open criminal cases against Popovtsev. In each case, prosecutors refused, claiming there was no evidence a crime had been committed. In the end, OST's 60-year-old bookkeeper, Nadezhda Legecheva, was sentenced to five years in prison in connection with the case.

Fedyarov's investigation uncovered one other case that raises eyebrows. In 2014, Popovtsev's company Yarkovskoye was virtually insolvent and owed the state agricultural bank Rosselkhozbank some 26 million rubles. Because the firm was in bankruptcy, it could not participate in state tenders. However, another Popovtsev firm, Ovoshchevod, signed a 28.5 million-ruble contract with IK-2 and paid off the debt to Rosselkhozbank. Yarkovskoye again began signing contracts with FSIN structures, while Ovoshchevod was moved to Altai Krai and liquidated.

Fedyarov says he believes that moment was extremely risky for Popovtsev because if Rosselkhozbank had taken Yarkovskoye into receivership, it would have had complete access to documentation about how the loan money was spent and all of the company's FSIN contracts.

Written by Robert Coalson on the basis of reporting by Sergei Khazov-Cassia of RFE/RL's Russian Service
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