MOSCOW, Russia (3rd UPDATE) – Russia charged Economy Minister Alexei Ulyukayev on Tuesday, November 15, over suspicions he pocketed a two-million-dollar payoff during a deal involving state-controlled oil giant Rosneft.
Ulyukayev was the highest ranking official to be detained over suspected corruption since President Vladimir Putin took power in 2000 and vowed to clamp down on endemic graft.
The 60-year-old minister’s detention has sparked a wave of speculation over whether the charges could be linked to an internal power struggle.
Russia’s Investigative Committee said Ulyukayev had “illegally demanded” payment to give his go-ahead for Rosneft to acquire a majority stake from the state in Russian oil company Bashneft in a $5.2-billion deal last month.
Investigators accused Ulyukayev of “threatening (and) using his ministerial powers to create obstacles to the company’s activities in the future.”
The committee had said earlier Tuesday that the FSB security service, the successor to the KGB, detained Ulyukayev following an operation on Monday as he was receiving the bribe.
Investigators did not say who handed the alleged bribe to Ulyukayev.
The eventual sale of the 50.07% stake in Russia’s sixth-largest producer came after months of wrangling that has seen Rosneft – headed by Igor Sechin, a powerful Putin ally – face down opposition from some in the government.
Ulyukayev originally opposed the sale but later endorsed it after Putin said it could help fill state coffers.
The large-scale bribe-taking charge could see him face a jail term of between eight and 15 years.
Investigators on Tuesday requested that Ulyukayev be put under house arrest, an investigative committee spokeswoman told RIA Novosti state news agency.
Investigators have said that the acquisition itself of the Bashneft shares was not the subject of the criminal investigation.
‘Very serious accusation’
Ulyukayev, who has served as head of the ministry of economic development since 2013, was tasked with pulling Russia out of the longest economic crisis since Putin took power 16 years ago, sparked in late 2014 by falling oil prices and Western sanctions over Moscow’s actions in Ukraine.
RIA Novosti cited a law enforcement source as saying that Ulyukayev was detained as part of a “sting operation” after investigators received “serious evidence” from “tapping his conversations and the conversations of his associates.”
A Rosneft spokesman declined to comment on the charges but that it acquired the Bashneft stake “in accordance with Russian law on the basis of the best commercial offer made to the operating bank.”
Kremlin spokesman Dmitry Peskov – who said Putin had been informed of the start of the operation that led to Ulyukayev’s detention – told Interfax news agency: “This is a very serious accusation that requires very serious proof. In any case only a court can decide.”
He later told reporters that Russia’s fight against corruption was “systematic and not selective.”
Elites in ‘shock’
Ulyukayev’s detention has sent shockwaves through the Russian elite, which had seemed immune to criminal prosecution.
Putin’s critics insist he has turned a blind eye to widespread corruption as his close allies have amassed vast fortunes during his time in power.
In another recent high-profile corruption case, the acting head of an anti-graft agency at the interior ministry was arrested in September for taking bribes after police found more than $120 million in cash during a raid of his Moscow flat.
In July, Investigative Committee officials were detained on suspicion of taking large bribes from a mob boss in return for dropping his case.
And ex-defense minister Anatoly Serdyukov was dismissed in 2012 over a major corruption scandal.
Ulyukayev’s detention is “a shock for the whole establishment,” sociologist Olga Kryshtanovskaya, who studies the Russian elites, told Agence France-Presse.
“A person of that level has never been arrested here on suspicion of a criminal offence,” she said.
Former liberal finance minister Alexei Kudrin wrote on Twitter that the case raised “many questions” and called for an impartial investigation into the matter.
Former federal lawmaker Gennady Gudkov, a staunch Kremlin critic who once served in the KGB, said Ulyukayev’s detention was the result of an internal power struggle among high-ranking officials.
“What we are seeing today is not a fight against corruption,” Gudkov wrote in an op-ed published on the website of Ekho Moskvy radio station.
“It is a fierce internal fight for influence, financial flows and positions.” – Rappler.com