Sergei Stepashin, on the Take

The Moscow Times reports:

The Audit Chamber has threatened to sue liberal activist Marina Litvinovich for implicating its head and his family in a report on government corruption.

But Litvinovich stuck to her findings, saying she relied on various media reports that had never been challenged in court — implying that they were true.

Her report, posted Friday on the web site Election2012.ru, is titled “Power of Families. The Government. Part 1.” It targets the families of 18 senior officials, including Audit Chamber head Sergei Stepashin.

The report, which took three months to produce and had five co-authors, never directly accuses anyone of corruption but claims that officials along with friends and families “are controlling cash flows that go from the state budget to private, mainly offshore, coffers.”

As for Stepashin, his family is involved in businesses that have benefited from the activities of the Audit Chamber, the report says.

One example it gives is this year’s acquisition of Bank of Moscow by VTB, where Stepashin’s wife, Tamara, is a senior vice president. It says Bank of Moscow, which tried to fight off the merger, faced a check by the Audit Chamber last year.

Stepashin’s son Viktor allegedly received a stake in unspecified Cyprus-based companies affiliated with East Line group, which owns Moscow’s Domodedovo Airport. The report says he acquired the stake after the Audit Chamber opened a check into East Line in 2001.

It also says a longtime associate of Tamara Stepashina, Moscow Metrostroi head Vladimir Kogan, had a business dispute with former Moscow metro chief Dmitry Gayev in 2010. Gayev was fired in February and is under investigation following a check by the Audit Chamber.

Another bank linked to Tamara Stepashina, Promstroibank, received cut-rate leases on three buildings on Ulitsa Bolshaya Lubyanka in downtown Moscow in 1999, when her husband became prime minister, the report says.

The Audit Chamber admitted in a statement Tuesday that Stepashin’s family members have business interests but denied nepotism.

“No proof is presented that Stepashin’s wife, her mother and his son are owners of active commercial structures that play any significant role in the economy and enjoy state preferences,” the Audit Chambersaid in a vaguely worded statement on its web site.

The statement provides a step-by-step rebuttal of every accusation, including the link between Tamara Stepashina and Vladimir Kogan, who was 11 at the time Stepashina first came to Promstroibank in 1974, the Audit Chamber said.

But it does not comment on an allegation that Stepashin’s “support” of the production of Eclipse 500 small jets in the Ulyanovsk region in 2008 “may have contributed” to Svyaz-bank’s decision to invest $150 million into Eclipse Aviation, which later declared bankruptcy and failed to return the money.

Litvinovich must either back her accusations with solid evidence or apologize to Stepashin’s family to avoid a defamation lawsuit, the statement said.

But Litvinovich said on her LiveJournal blog late Tuesday that the report was based exclusively on open sources. The online version of “Power of Families” provides links to the web pages with original publications referred to in the text. None of those publications were ever contested in court, Litvinovich added.

She said she would send a formal refusal to apologize to the Audit Chamber and release a new report about Stepashin and his family.

No one else mentioned in her report has commented on it.

“Power of Families” offers a list of government members thought to be most involved in business activities, including those involving corruption. The top three spots are filled by former Federal Security Service head and current Security Council Secretary Nikolai Patrushev; Finance Minister Alexei Kudrin; and Transportation Minister Igor Levitin.

The document is currently only available in Russian, but an English version is forthcoming. The next report is to be released after the May holidays.

“We’re basically dealing with some 50 families of top officials and businessmen who have not just taken control over oil and other natural resources, but also organized financial flows to go into their families’ collective pocket,” the report said.

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