by The Ister
November 19, 2020
from TheSakerBlog Website
The Russian Art of Doing Business
© Global Economic Outlook Russia,
Maria Corte Maidagan/Unknown/KJN
The 1990s was a time of immense suffering for the Russian people.
As the impending collapse of the USSR became discernable, insiders such as,
...created a planning group to ensure the continued influence of Soviet-era officials by transferring Russian state assets to offshore shell companies and thus stripping the country's wealth.
One such offshore company, FIMACO, was used to pilfer an estimated $50 billion from the nation.
Viktor Gerashchenko, the head of the central bank of Russia, sent a memorandum demanding transfers from FIMACO be covered up. It was through this looting that liquid capital was generated and used by future oligarchs to build their fortunes.
In return for his help
Viktor Gerashchenko was later given a position as the chairman of
Yukos by Khodorkovsky.
While the Russian public was horrified at the revelation, European bankers were less surprised.
It was whispered frequently among those circles that Soviet transport planes had been flying to and from Switzerland for months and selling off large amounts of gold.
announced his plans to privatize the nation's assets and the real
The Clinton administration sought to redesign the economic policies of the nascent Russian Federation according to the Washington Consensus:
They gave the role of economic planning in Russia to the Harvard Institute for International Development, which sent Harvard economists to meet with Anatoly Chubais, Boris Yeltsin's head of privatization.
The close relationship with Anatoly Chubais allowed a select group of American investors to be on an inside track of financial dealings in the new Russia.
One Harvard grad involved in this scheme was Jonathan Hay, convicted inside trader.
He became senior advisor to the GKI, Russia's new state privatization committee. Certain members of this network, which included Harvard graduates,
...and others, misused funds from USAID that were intended for Russian economic development and rigged deals for privatization to gain control of key Russian industries in backroom negotiations.
In one 1995 off market deal, Anatoly Chubais created a closed bidding process for prime national properties in which the only approved bidders were Harvard Management Company and George Soros.
This resulted in the acquisition of major stakes in,
Foreign investors flocked in and the level of greed among this fifth column of new Muscovites was truly astonishing.
The 1999 RICO suit Avisma Titano Magnes v. Dart Management is particularly enlightening.
RICO allows victims of a racketeering conspiracy to sue conspirators for damages caused by their illegal conduct, and the following defendants were named in the action:
The complaint document alleges the following:
They forced Avisma to sell its titanium below market price to offshore companies which they secretly controlled.
Next, these offshore companies sold the titanium at a correct price on international markets for profit, which was then funneled back from the offshore companies to the defendants and Bank Menatep.
Money that should have
been booked as profits for Avisma was siphoned away, and the
majority shareholders who were in on the scam benefitted at the
expense of minority shareholders, the company, and Russian tax
According to the complaint, the actions were discovered when defendants attempted to swap Avisma shares for shares of mining company VSMPO and replicate the same scam at VSMPO.
Baker and other defendants later excused their actions by claiming the suit was Russian targeting.
The secret society included the following oligarchs:
A Russian journalist named Andrey Fadin described their overwhelming power in an article,
Less than one year after publishing the article Andrey Fadin was killed.
Through their front man Anatoly Chubais, Semibankirschina used control of television networks to prop up Boris Yeltsin's low approval ratings.
From the mid-90s to 1999 this clique had total authority over Russian policies and industries, judiciously using violence to enforce its monopoly.
In one case Mikhail
Khodorkovsky and his underling Leonid Nevzlin carried out the murder
of the mayor Vladimir Petukhov, who was pursuing Yukos Oil Company's
evasion of taxes.
A new group of Putin insiders such as,
...formed and began supplanting the previous access that the Semibankirschina had to the president.
In 2001, a state takeover of media seized the television networks previously owned by oligarchs,
...prompting Patarkatsishvili to denounce Russia to the New York Times and flee the country.
While exiled in the UK, Badri Patarkatsishvili died suspiciously at the age of 48. The Georgian government has called his death an assassination.
also died suspiciously in the UK after having sold his Russian
assets and denounced Putin. After his television networks were
seized, Vladimir Gusinsky was criminally charged with money
laundering and forced to flee the country as well.
George Soros was banned from,
Once the richest man in the country, Mikhail Khodorkovsky's fortunes turned for the worse as well.
In the early 2000s, Putin pushed through a number of populist reforms for criminal, tax, and land law, which the oligarchs of the 90s had strongly opposed.
As the most blatantly criminal member of the original Semibankirschina, Khodorkovsky's Bank Menatep had been founded with funds stolen as part of the looting of state assets.
The bank operated as a hub of money laundering and engaged in countless financial scams, even delaying government funds to Chernobyl victims while using their money to financially speculate.
It was Bank Menatep through which American fraudsters had allegedly ripped off Avisma shareholders with the titanium dumping scam.
This wave of prosecution sent a message and gave Putin a strong position, which was used to negotiate a "grand bargain" with the remaining oligarchs:
The era of financial gangsterism from the 1990s was over...
Because of the lack of collaboration with other central banks it is certain that Russian gold is present in Moscow's vaults:
So instead of buying US treasuries or dollars for its reserves, the Bank of Russia can demand physical gold delivery into Moscow vaults.
This will continually strain the fraudulent COMEX and London Bullion Market systems with the pressure of physical shipments and threaten the dollar.
Russia is in the position to attack
the dollar as a net commodity exporter, meaning when its gold
purchases bid up the price of metals it is simply increasing the
receipts of its own domestic commodity producing companies like
Norilsk Nickel and VSMPO-AVISMA.
A decade of economic warfare in the form of sanctions has cut off access to international capital:
These low debt levels have tangible benefits, primarily that Russia is now able to withstand large economic fluctuations without crumbling as a result of internal defaults.
By comparison, the
financial system of America would disintegrate if it attempted to
sustain the decline in GDP Russia incurred from 2013-2016.
So sanctions have actually made the country stronger, as hubris of the McCain class of American politicians has created a competitor state with no stake in the survival of the existing debt-based financial order.
Russia's mission to create resiliency and restore sovereignty foreshadows a tumultuous future, while America bets everything that the world will remain the same.
The Safras are one of the oldest and most secretive of the banking families, with a fortune dating back to the gold trading caravans of the Ottoman Empire.
It was Edmond Safra who served as Bill Browder's mentor in Russia, providing him with an initial seed funding of $25 million to start his Hermitage Fund.
When Browder needed protection during a business dispute with an oligarch, Safra sent his emissary four armored vehicles and fifteen bodyguards led by a former Mossad agent.
While Edmond Safra spent much of his later life defending himself from drug trafficking and money laundering allegations, he was accomplished, nonetheless.
Just after Putin's takeover as president, Villa Leopolda was broken into.
Safra's nurse, a former Green Beret named Ted Maher, was stabbed by two masked intruders who entered the premises, after which Safra was killed.
Under pressure from Monacan authorities, Ted Maher was forced to sign a nonsensical confession in which he claimed that he stabbed himself and admitted to setting the fire in order to attempt to gain his employer's adoration.
He has since recanted this confession, saying that his defense attorneys coerced him into signing and threatened he would never see his family again otherwise.
Jean-Christophe Hullin, the chief judge in the case, revealed in 2007 that the guilty conviction was a predetermined outcome which had been planned in a secret meeting with himself, Maher's attorneys, and the chief prosecutor of Monaco:
Now free, he believes Safra was ordered killed by Putin,
It was during the purge of oligarchs and vulture capitalists that the true power behind Mikhail Khodorkovsky emerged.
When it became likely he would be arrested, he arranged to have all his shares from the Yukos Oil Company transferred to the ownership of Jacob Rothschild.
The transfer took place in November of 2003, giving Lord Rothschild control of shares estimated by the Sunday Times to be worth $13.5 billion.
Putin subsequently liquidated and nationalized Yukos by seizing and selling off its shares to state oil companies at much below market value.