Russia’s governmental workers are not used to be accountable to the community. Even most open and democratically disposed among them do not consider it justified the interest to the activity by and wealth of their families.
Novaya Gazeta continues monitoring of business activity of the relatives of the top level officials and their connections in the business world. Previous materials of the column related to deputy chief of the President’s administration Igor Sechin , deputy Prime Minister Dmitry Medvedev, President’s Assistant Viktor Ivanov and deputy Prime Minister Sergei Ivanov, also deputy Prime Minister and finance minister Alexei Kudrin and deputy chief of the President’s Administration Vladislav Surkov.
Here we shall consider the head of energy and industry ministry Viktor Khristenko and minister of public health care and social development Tatiana Golikova.
Energy and industry minister Viktor Khristenko. Public health care and social development Tatiana Golikova.
Mr. Khristenko and his spouse Tatiana Golikova are an example of family ties within the Russian government. Khristenko’s daughter, Yulia, in 2004 married Evgeny Bogdanchikov, the junior son of the head of Rosneft Sergei Bogdanchikov.
Yulia Bogdanchikova worked for a while as the senior specialist at the judicial department of Sevmorneftegaz which was created by branches of Rosneft and Gazprom with the purpose of developing the oil-bearing Prirazlomny and Stockman’s gas-condensate fields. In 2006 Gazprom consolidated 100% of the stock of that company. As we were informed by the company, Yulia left it after some period of working.
Since 2004 Evgeny Bogdanchikov worked for Fleming Family and Partners Ltd. in Russia. This British financial Group manages the assets of the Fleming family and of other clients. The assets are estimated to be over $8 Bn. The Company’s office confirmed that Mr. Bogdanchikov worked for them but they failed to remember his position. At the time being, the son of President of Rosneft is not FFP Company’s employee.
In 2001 Viktor Khristenko and Tatiana Golikova founded a non-commercial organization, charity Fund of restoration of the Convent of Dormition. Andrei Reus, Evgeny Dedkov and Andrei Dementyev were among the co-founders of the Fund. Afterwards, they were given managing positions in the energy and industry ministry.
Sergei Preobrazhensky turned out to be the only businessman among the charitable Fund co-founders. He runs the Magma Company that is the general distributor for OAO Magnitogorsk Mill, or MM. In 2007 the MM’s owner Viktor Rashnikov held the 11th position in the Russian version of the Forbes magazine list with his fortune estimated to be $ 9,100,000,000.
The press office of the MM stated that participation in the charity Fund was the private initiative by Mr. Sergei Preobrazhensky and was not connected to the activities by the Group. Mr. Preobrazhensky himself did not give any comment.
”The Fund of Restoration of the Staritsky Convent of the Dormition was founded in 2001 when I was working as deputy chair of the government” said head of energy and industry ministry Viktor Khristenko. “It appeared thanks to sympathetic responding by close to me people. They do care about the state of the historical sacred place and they have done their best to draw attention to the restoration works by a wider circle of enterprises and organizations. <…> The Fund has made real contribution to the restoration of the Convent and we are going to continue that work. <…>”.
”We do not make it public the status of the Fund’s co-founders as they are acting as private persons, not as state functionaries or Company’s representatives” assured us Yuri Alexandrin, director of the Fund’s development. “I cannot name those who make charitable contributions as no participant of that noble cause would like to draw attention to themselves because of it”.
Mr. Alexandrin noted that Staritsky Convent of the Dormition was in a wretched state and was in undeserved oblivion. At the time being, a significant volume of building and restoration works is being carried out there and it is planned to have them completed by 2010 when the Convent will observe its 900th anniversary. This cloister, that witnessed many historical events, takes prominent place not only in history of the Russian Orthodox Church but also in the whole Russia’s history, stressed the director.
Head of Public Health Care and Social Development Ministry Tatiana Golikova did not comment the situation.
Interrogated by us experts do not doubt that such Funds can be really helpful. They only noted that under Russia’s conditions the charity organizations, created by influential government employees and members of their families, look more attractive for businessmen than other Funds.
”This can be the way of demonstrating one’s loyalty, though, we should not exclude the sincere motives either” believes Elena Panfilova, Director of Russian branch of Anti-corruption Research and Initiatives Center named “Transparency International”. Her reckoning, though, is that now businessmen are very careful about whom they should be friends with, as any mistake may have disastrous consequences.
Viktor Khristenko’s son, Vladimir, works for metallurgy group ChTPZ controlled by the senator from Legislative Assembly of Chelyabinsk region, member of United Russia party, Andrei Komarov. In 2007 Russian Forbes estimated his fortune to be $1,300,000,000.
In 2003 22-year-old Vladimir Khristenko graduated from the Higher School of Economics and became the project manager of one of the largest metallurgy traders in the Russian market, that’s the “System of complex supply MeTris” (it’s included in the Group ChTPZ).
In 2004 the minister’s son headed analytical department of MeTris and managed the project of direction of strategic development of the ChTPZ group. In 2005 he took the position of General Director of the service division of the ChTPZ group named “ChTPZ Complex Pipe Systems”. In 2006, at the age of 25, he headed the board of ChTPZ-KTS and observatory board of MSA a.s., the Czech manufacturer of the pipe fitting that is part of ChTPZ-KTS.
”ChTPZ Group never concealed the fact that Vladimir Khristenko works for the company” the representative of ChTPZ Anna Levitanskaya told to a Novaya Gazeta correspondent. “Vladimir Khristenko is a hired manager who started his career as project manager and who is successfully going uphill due to his education and business and personal qualities. As of today, Vladimir Khristenko is a public figure and acts as a company’s spokesperson in some cases within his competence”.
Mrs. Levitanskaya stressed that ChTPZ has never considered presence of Vladimir Khristenko among the company’s staff as the way of reduction of bureaucratic obstacles and a fortiori as the way of promotion of the company’s interests within the government structures.
The representative of the ChTPZ does not consider it appropriate to speak about conflict of interests in this case, i.e. about the situation where an official regulates the sphere where his relatives work.
”As for the concept of the conflict of interests in relation to the persons holding high ranking governmental positions, such a concept has not been defined by the law” noted Mrs. Levitanskaya. “So any statements about that would be subjective. From our side, we support the necessity of passing the law “On resisting corruption” which would be regulatory for such kind of issues”.
Really, the settlement of conflict of interests is not defined clearly enough in Russia. There is only Decree #269 dated 3 March of 2007. It is issued by President Vladimir Putin and it is titled “On commissions for observance of the requirements of the official conduct by government civil servants of the Russian Federation and settlement of the conflict of interests”. Though, it is not known if such commissions were formed at all and in which ministries and with what issues they worked if they did.
There is also the bill “On resistance to corruption” prepared by the inter-agency working group headed by President’s Assistant Viktor Ivanov. The document implies a number of procedures but its possibility is still being decided in the President’s Administartion.
Vladimir Khristenko, whom we called on his cellular phone, having heard our request for comment, asked us to call back and switched the phone to the secretary.
Viktor Khristenko, head of energy and industry ministry, agreed to discuss the situation. We should stress it that out of 6 high ranking government workers to whom we sent requests before he is the only one who did not avoid the sharp questions:
”I cannot speak about my attitude to the bill mentioned as I have not read the text. As for independent elaboration of the bill regulating activities by officials in the government, I consider it to be normal. It does not matter if like or do not like this or that proposal by the bill developers. At the end of the day, the law will have to be observed.
Along with that I realize, of course, that the sphere by energy and industry ministry in Russia is so wide that it would be difficult to find the area where my relatives did not work. I, as a father of three children, consider it to be definite thing the following. My children have the right of choosing specialty, getting instruction, having probation period, increasing their competence, changing places of work etc. If it turned out that the minister’s children cannot have such kind of freedom it is likely that I would try not to hinder my children from realizing their own choice.
I am confident about your right to be interested in any details of my biography. People vested in big powers must be held especially responsible. But it’s me, not my children, who are responsible. They are private persons like you are. Making public access to information about this or that aspect of their lives is justified to same extent as it can be applied to any other Russian citizen.
I am proud of the fact that my son Volodya – like father, like son – is working at the leading enterprise of South Ural where I come from and where my relatives live. As the head of the industry ministry, I see only positive points in the fact that this enterprise cooperates with European enterprises.
As for my daughter Yulia, I can tell she is a student at present and she is developing her potential in the field of psychology, supplementing it to her legal education.”
Experts are ready to argue as concerning public interest to the activities by the top officials’ relatives.
”There is a sphere where such privacy is not applied to” argues Elena Panfilova. “There are certain self-restrictions related to government service and they are applied to family members too. For example, international conventions, signed by Russia, include the family members into the lists of those whose property must be declared. FATF convention requires serious control over “publicly significant persons” and it’s not only officials, deputies, judges, high ranking military officers, and heads of state monopolies, but also their relatives.”
The notion of “relatives” includes even divorced spouses during the three-year period after divorce took place.
That’s an absolutely fair game. If a person has chosen working in the governmental sector, he gets not only big powers but also must admit to self-restrictions.
Reference by Novaya Gazeta
Co-founder of Fleming Family and Partners is, for example, Robin Renwick, Lord of Clifton, former diplomat, British ex-ambassador in S.Africa and later in the USA (former US state secretaries Henri Kissinger, Colin Powell and former vice-President Albert Gore are among his partners). Russian businessman, senior partner, Mark Garber is the board member of FFP. Mr. Garber was the board member in OAO Rosneft-Sakhalinmorneftgaz till June 2001. In his time he also worked with the founder of the Russian multisectoral group Sintez Leonid Lebedev and businessman Alexander Zhurov.
Andrei Reus is a member of board at Rosneft. He was deputy head of energy and industry ministry till September 2007. Starting from last year he has been working as general director of the united industrial corporation Oboronprom. Reus comes from Chelyabinsk, like Khristenko, they worked together in finance ministry. From 1999-2004 Reus headed secretariat of Khristenko who was deputy prime minister in the Russian government.
Evgeny Dedkov used to be chief of the health care department of Chelyabinsk region, then he was deputy chief of regional administration, then worked with Khristenko in finance ministry, and in 1998 when the latter took the position of deputy prime minister, he headed his secretariat till the moment Andrei Reus came to fill that position. At the time being, Dedkov is the head of the administrative department at the energy and industry ministry.
Andrei Dementyev from Chelyabinsk region was the advisor and deputy head of secretariat of the deputy prime minister Khristenko. At present Mr. Dementyev is deputy minister.