MDM Bank: theft is legal

A recent ruling by St. Petersburg City Court undermines one of the major tenets of the market economy in the country, that is, citizens' confidence in the banking system. In Russia the fate of any multi-million dollar bank account now depends on the mood of clerks with a salary of $ 700. Judicial system and MDM Bank seam to tolerate careless and untrammelled dispose of fortunes, entrusted to the bank.

No clerical mistake
When after the New Year holidays on 11 January 2011 Tamara Kostomarova, CEO at TVK legal consulting company in St. Petersburg, logged on to the online service system of MDM bank, she saw that her money was gone from her account. Or, to be more precise, she saw that not only the money but the whole account was gone, as if she never had one.
She could not believe her eyes. She then thought it was an internal clerical mistake in the system and called the bank to find out when their IT people would fix the problem.
Talking to the clerks made it even worse. Tamara Kostomarova was told that her account was closed by her trustee. The woman was shocked. That account had over 11 million rubles meant for paying for surgery in a French hospital for her diseased son.
She contacted a man with a very influential position in this major credit institution, Konstantin Khaitovich, head of St. Petersburg branch in MDM bank. She wrote an eloquent and detailed claim, which ended as follows:
«When I contacted bank employees, I learnt that my deposit account was closed… on proxy I never gave to anyone. I am therefore asking you to take relevant measures to return my money and to clarify the situation…»
We cannot be sure as to the measures taken by MDM bank staff and their ST. Petersburg branch head, but Tamara Kostomarova developed an opinion that claims and negotiations are worth nothing in this situation. So, she had no choice but to take the bank to court. In June 2011 she filed a lawsuit to Vyborgsky district court of St. Petersburg in charge of the district she lives in.
Claims Tamara Kostomarova put forward were quite impressive: she demanded to recover the deposited amount with interest as of the moment of filing the lawsuit amounting to 11 863 627 rubles, a fine of 11 863 627 rubles, losses amounting to 1 000 000 and punitive damage worth 300 000 rubles. In total, her financial claims to MDM Bank reached 25 027 255 rubles, which anyone would call just as the bank must never treat their clients with such utter disregard.
1 справка Банка о движении денежных средств
«Bank statement certifying withdrawal of money from Tamara Kostomarova's account by the con artists»

So what exactly was it that happened in MDM bank in January 2011 causing Tamara Kostomarova to lose such a significant amount of money?

All at once
On 6 January 2011 a man walked into Kamennoostrovsky office of MDM bank. According to the passport he presented to the bank employees, his name was Mikhail Aleksandrovich Kobyakov. The man also had a proxy letter that gave him the right to manage deposit agreement and the attached account safeguarding some 11 359 316 rubles with interest that was property of Tamara Kostomarova.
2 доверенность Кобякову
«Proxy letter issued to fraudster Kobyakov»

Pseudo-Kobyakov (later it turned out the passport was forged) tried to withdraw all the money but failed due to operational reasons. Kamennoostrovsky office of the branch simply did not have that much money in cash. The man only managed to take out 2 000 000 rubles. The rest of the money he transferred to Tamara's checking account and closed the one with the deposit.
One little nuance: the agreement between the bank and Tamara Kostomarova stipulates that «Withdrawal orders of the client received by the bank are carried out on the next working day».
3 договор вклада
4 договор вклада 2
«Contract between Tamara Kostomarova and MDM Bank»

Why in this case did the bank employees give such an amount to a person acting on a strangle-looking proxy letter? Its ambiguity was striking and stood out like a sore thumb: signature on the letter allegedly signed by Tamara Kostomarova was not at all like her signature that any bank employee could easily see on the deposit agreement she had signed with the bank. Why did the clerk who handed the 2 million rubles to the criminal neglected such a fact?
Moreover, the agreement was terminated prematurely, causing loss of interest amounting to about a million rubles or about 30 thousand dollars. This as well did not strike anyone as suspicious!
No doubt, bank employees must be held liable for all the above mentioned irregularities, liable to law enforcers, not to journalists.
On 11 January 2013 Kamennoostrovsky MDM office saw another visitor, a man who presented a passport issued on the name of Pavel Vyacheslavovich Krylov and another proxy letter empowering the man to manage Tamara Kostomarova's checking account, the one where on 6 January the remaining 9 359 316 rubles from her bank deposit were transferred by the fraudulent proxy holder due to the lack of cash in the office that day.
5 доверенность Крылову
«Proxy letter issued to fraudster Krylov»

Later it turned out that this new passport was also a forged document, so as the proxy letter. Meanwhile, the signature on the second proxy letter was a different one, still not matching the woman's signature on the agreement with the bank.
6 реестр Ашкалуниной Крылову
«Register if notary public Ashkalunina confirming the act of issuance of the fraudulent proxy letter to fraudster Krylov»
7 реестр Чистяковой Кобякову
«Register if notary public Chistyakova confirming the act of issuance of the fraudulent proxy letter to fraudster Kobyakov»

Apart from that, scanned copies of the documents show that even the signatures of Krylov differ from one another: the one in his passport does not match the one on the bank order. It is obvious that the one on the bank order is a forged one. According to the banking rules, the cashier must check the signatures on the order and in the passport, but this was not done.
8 паспорт Крылова
«Passport presented by fraudster Krylov»
9 ордер на выжачу наличных средств Крылову
«Bank order for the cash to be given to Krylov»

Yet, MDM clerks could care less about this fact and they boldly gave the 9 359 316 rubles in cash to the fake Krylov.
In both cases MDM bank employees violated paragraph 2.4.2 of the agreement the bank had signed with Tamara Kostomarova which reads as follows: «The client has the right to empower a third party to manage the checking account by proxy. Proxy letter must come with a supplement of a card containing specimen signature of the entrusted person…» In fact, the bank employees could have at least called the client to make sure if she had had the proxy letters issued to Krylov and Kobyakov to manage such a sensitive amount of money. For some reason they neglected to do even this little thing, and we believe that law enforcement agencies must look into this part of the incident as well.
In fact, this outrageous situation make the Russian realities transparent and shows that cashiers and clerk who earn some 15-20 thousand rubles a month can easily do whatever they want with loads of money with no consequences.
A further twist to this story is that both proxy letters had on them correct information on Tamara Kostomarova passport details. This means that notary public was visited by a woman with a fake passport manufactured especially for this particular case. Usually criminals put personal info they need to use as IDs in passports with random numbers. The tricksters also knew the account numbers; information that is very hard to get except cases when the bank is involved.
Later during litigations witnesses at the notary public testified that indeed a woman came to them and presented a passport with Tamara Kostomarova's personal information in it, but the woman looked nothing like the real Tamara present in court that day. Neither mistakes in family names spelling, nor mistakes in the very name of the entrusting person (they spelled Tomara instead of Tamara, Kastamarova instead of Kostomarova) looked suspicious to the notaries. Moreover, in the framework of proceedings initiated after Tamara Kostomarova filed her lawsuit, investigators at Vyborgsky district court of St. Petersburg questioned notary public Krasnova on 28 March 2012. She claims that the way clients sign their name is no concern of hers and the clients «can draw a castle or a bat» for a signature, if they please. And even this would not make the notary concerned and doubtful.
Following the principle of «know your heroes» so to say, we publicise the names of notaries who registered proxy letters involved in this story. The two people involved are Snezhana Praulova, acting notary temporarily replacing Elena Chistyakova, and Natalia Krasnova, acting notary temporarily replacing Olga Ashkaulina. In fact, both Snezhana Praulova and Natalia Krasnova supported MDM bank in litigations between MDM bank and Tamara Kostomarova.
However, the notaries, bank staff and the criminals who received the money belonging to Tamara Kostomarova faced no charges. Investigation proceedings initiated over the criminal activity was quickly terminated due to the failure of St. Petersburg police to point out the people who should be held liable.

MDM-bank holds no liability for what its personnel is doing
Looks like thieved depositors and no return for stolen money is turning into a common situation for MDM-bank. Tamara Kostomarova is not the only victim whose money was stolen from a deposit in the bank. Last year another actively discussed court trial against MDM-bank emerged as a result of claim filed by Aleksandr Tikhonov, a VIP client of the bank who was robbed of 16 million rubles.
Aleksandr Tikhonov is a resident of Austria. He found out that his money had been stolen only when a Russian investigator contacted him in January 2012. Having arrived in Moscow, Aleksandr learned that his money had been stolen back in 2008 by head of MDM-bank VIP clients service sector Tatiana Burenina. When she joined the bank in 2001, Tatiana was a front desk clerk. In 2003 she was promoted to head of department and in 2005 she began to steal money. Over the four years she robbed several clients. In total she looted about 34 million rubles by cashing out money from clients' accounts or transfering it to other accounts. In August 2009 she was fired by the bank.
Tatiana Burenina was taken to court twice. Her first trial was in 2011 when she confessed having stolen several tens of thousands of rubles from the clients. She was sentenced to a fine of 150 000 rubles and released on parole. At the same time depositor Astakhova won in a civil court trial against Burenina and was awarded 410 000 rubles. Meanwhile, other facts of theft continued to hit the surface. In 2012 Burenina found herself in court once again, sentenced to the same amount of fine reaching 150 000 rubles. But this time she was also sentenced to three years and two months in standard regime penal colony. Bank depositors received a total of 1.12 million rubles in compensation based on their claims.
Aleksandr Tikhonov decided to leave Burenina alone and return his money at the expense of the bank that allowed for theft in the first place. Civil law stipulates that the employer is liable for any damage inflicted by its employees. Investigation described the theft protocol as follows: Burenina forged Tikhonov's signature on bank orders and later received the money from the accounts she had transferred the money to, or she could receive it from the cashier.
The bank did not object to return the money stolen by transfer and in fact returned about 4 million rubles that the woman still had on other accounts in the bank. However, the bank decided to look for an opportunity not to return the money that Burenina had taken out through the cashier, and that is a total of 12.5 million rubles. MDM-bank informed Tikhonov that “it is impossible to verify the fact that money has been stolen from the account”.
The bank decided that only Burenina should be held liable for theft of clients' money. According to the bank, case materials show that Burenina was acting alone and no other bank employee was involved in her criminal activities. However, Tikhonov does not believe that Burenina could carry out the robbery without any assistance from her colleagues as the signature on the bank orders looks nothing like the one of Tikhonov or the one of Burenina. Yet, no other employee was punished or laid off for covering up for Burenina and the protocol for money withdrawal remained the same even after the criminal activity was spotted.
Meanwhile, Aleksandr Tikhonov is pursuing to obtain the whole stolen ammount from MDM-bank.
In an attempt to support their position they voiced ridiculous arguments: “the plaintiff claims to have nothing in common with the two (Ed. Note: Kobyakov and Krylov), which means that she has nothing in common with the money as well”.
Such court rulings undermine the very basis of market economy, i.e. confidence of the residents in the banking system. Confident in the positive outcome of any trial against them, banks do not bother to protect deposits of their clients from criminal activities by fraudsters.
Tomas Gordon, especially for

Oleg Deripaska has blackened in London

At the High Court in London, the opening speech of Mark Howard, attorney of Mikhail Cherney, who issued a claim for 20% of Russian Aluminium JSC (RUSAL) of Oleg Deripaska, was completed.

"The heart of the case" was the events on March 10, 2001. This date was stated on the two documents signed in London hotel Lanesborough. On the first agreement, Oleg Deripaska was to pay Mikhail Cherney $100 million for 17.5% of Siberian aluminium (Sibal, entering in Russian aluminium company after the merger with the assets of Roman Abramovich in 2000) and another $150 million to repay the debt of the company. In addition to the agreement, it stated that within three to five years Deripaska was to realize 20% of Russian aluminum to third parties and pay Back the amount on the basis of current market value of shares minus the $ 250 million.

 Payment of $250 million was held. But the respondent insists that these documents were only established with the aim to end the "roof" relationship with Mikhail Cherney and Anton Malevsky. According to Deripaska, the addition to the agreement was just about the "payment of kickbacks."

The complainant claims that by the moment of acquaintance with Deripaska in October 1993 at the London Metal Exchange, he had already been a successful entrepreneur with extensive contacts in government and business. The lawyer told about the close cooperation of Lev and Mikhail Cherney with Trans World Group (TWG) David and Simon Reuben since 1992. Deripaska, according to the complainant, at the moment of their acquaintance needed the support of Mikhail Cherney, at least in order to establish control over the Sayanogorsk aluminium smelter (SAZ). By October 1993, his share had not exceeded 10%. The lawyer told the court about the curious episode: on October 22, 1993, at the meeting of SAZ shareholders, about 75% voted against Deripaska's appointment as Director of the factory.

Just after that, as the complainant states, Deripaska was advised to enlist “the support of the international trader". Thanks largely to TWG, Oleg Deripaska managed to establish control over SAZ and develop his aluminum business. Mikhail Cherney played a key role in providing this support.

 One of the most interesting moments in the speech of the lawyer was the news that in 2003, SUAL of Victor Vekselberg was ready to buy 50% of Russian aluminum for $3 billion from Cherney and Deripaska. At a meeting in Vienna in mid-2003, Mikhail Cherney expressed concern that had not yet received the money for the remaining in the company 20%, and agreed to $1 billion from the transaction with SUAL. However, Deripaska refused to sell the business and assured Cherney that he would perform his obligations. As Cherney discovered later, Deripaska had been already engaged in negotiations with Abramovich about the repayment of his share in Russian aluminium.



No-owner bank

The People’s Bank of the Republic of Tuva announced last Tuesday the board’s decision to issue new shares, Kommersant daily reports. The bank has only 2 weeks to outline and implement recapitalization plan that implies raising the bank’s authorized stock from 97 million roubles ($ 3.1 million) to 180 million roubles ($ 5.7 million) by 1 January 2012. Taking into consideration the time that the recapitalization usually takes, that is 3-6 months, it is likely that the bank, in the past owned by former Tuva representative in the RF parliament Sergei Pugachev, will lose its operating license.

The bank’s shareholders have not yet agreed on the recapitalization terms. “The sides agreed that the recapitalization should be implemented by the side which is on the shareholders’ register [at the moment of recapitalization]”, said a source close to the bank.

The bank has been in the center of the conflict of interests ever since previous controlling shareholders sold their stake.

One of the bank’s shareholders - government of Tuva, a Russia’s region on the boarder with Mongolia - said it had no plans to sell their shares. “We do not even consider selling our shares,” said local state property minister Orlan Dugur-Syuryun. “We want to get control of the bank”. He added that the ministry would file a lawsuit against a firm called Tsentr Realizatsii that hold e-auction for a controlling stake in the bank and would seek reauctioning of the bank.

The analysts say it is very unlikely that the sides will reach an agreement until the New Year, which means the bank will lose the license. A corporate conflict that hinders additional issue of shares is a rare case for Russian banking system. State participation in the bank’s capital worsens the situation, the experts say. “It is easier for private shareholders to agree on the recapitalization. For them it is important to not lose the bank, while the state will never buy additional shares for unprofitable price,” says Evgeny Trusov, head of bank consulting and buying and selling banks department in NEO Tsentr advisory firm. 


Nemtsov apologizes, asks for probe into his phone taps

Marginal opposition group PARNAS flamboyant leader Boris Nemtsov was embroiled in a scandal yesterday after a Russian on-line outlet published his private telephone conversations.

Nemtov has apologized for offensive remarks and profanity today. “I apologize to Zhenya Chirikova, Bozhena Rynska and all those who were affected or insulted in my private telephone conversations. I think, what I did was wrong. One has to hold back emotions and mind every word even when talking with relatives and friends over the phone,” he wrote in his blog.

He also promised to take the case to court, asking Russia’s Investigative Committee to probe into the phone-hacking scandal.

The Life News internet publication, famous for delivering scoops, published the the PARNAS leader’s telephone calls, presumably made in advance to the 10 December rally. Nemtsov derided his supporters saying they were “chemical internet types” and labeled fragmentized opposition leaders “scoundrels”, “bitches” and “prostitutes”.

The publication of Nemtsov’s talks got backlash among Russian pro-liberal bloggers - they condemned phone hacking. In fact, they were even more indignant at the fact of Nemtsov’s telephone having been hacked than at what he really said.

“Methods are sometimes more compromising than the result reached”, twitted Evgeniya Chirikova, leader of For the Khimki Forest movement.

Pro-liberal Ekho Moskvi radio station editor-in-chief Aleksei Venediktov said that the publication of Nemtsov’s telephone talks would attract more people to the 24 December rally. “I think, more people will come, because everyone can put himself in Boris Nemtsov’s shoes and understand that their phone could be tapped and leaked to the media. Everyone feels humiliated by this violation of Constitution,” said Venediktov.


Navalny on the loose

Famous blogger Aleksei Navalny was released from jail last night after a court sentenced him to 15 days in prison for obstructing police at the 4 December protest march, which was held without advanced notification of Moscow police.

Before Navalny left jail the only available information about his release had been its exact time - 2.30 a.m. Russian parliament MP Ilya Ponomarev whose status stipulates free access to any police station began searching for Navalny. He founded Navalny in Maryinsky Park police station. An hour before Ponomarev arrived in his car, Mrs Navalnaya had been told at the same station that her husband had been to a different place. By half past two, a few people gathered outside the station. On the door there was a sign: “Wait! You will be invited!” Navalny, accompanied by Ponomarev, came out at quarter to three. He asked photographers to let him first greet his wife, saying that a family reunion photo would be very romantic. But no one yielded to a point, and Navalny began to speak. His words contained nothing new and were laced with his famous “crooks and thieves” catch phrase.

“We got into jail in one country, 15 days after we get out in another country,” he said. Deprived of reliable information, Navalny looked as if he were afraid to say something in a wrong way. He made it clear that he saw the situation change in the country.

“Putin will not be legitimate president,” the blogger and anti-corruption whistle-blower said.

“It would be illegitimate act of succession to the throne. One crook hand over power to the other crook. Free presidential election is among our claims. In those elections lots of people will take part, me possibly”.

Navalny said nothing else about his plans for political future. 

“To avoid provocations”, Ponomarev undertook to see Navalny home.

On Wednesday, leader of minor opposition group Ilya Yashin has left the jail where he served the same term for the same offenses. reported, that he refused to have a crime prevention talk.


Mironov has decided to demand Tkachev’ resignation

Reportedly, Just Russia leader Sergey Mironov said that his faction intends to appeal to Russian President Vladimir Putin at the State Duma session, demanding the resignation of the head of Krasnodar region Alexander Tkachev. According to Just Russia, Tkachev doesn’t cope with the duties of the leader of the region.

Mironov also said that Just Russia faction insists on a parliamentary investigation of the circumstances of the tragedy in Krasnodar region. "Just Russia faction calls for a parliamentary investigation into the circumstances of the catastrophe to determine the effectiveness of the government bodies and officials’ activities", Mironov said at the State Duma plenary session.

According to Just Russia, great responsibility for the tragedy devolves on the governor of Krasnodar region Alexander Tkachev. Just Russia believes that the local authorities failed to provide adequate public notification of the approaching disaster, and it led to the large numbers of victims.

Alexander Tkachev responded to Mironov’ criticism by offering him to try himself for this job and then to discuss his actions. "It is big-time politics ... Will it be in a different way if they put Mironov here? I doubt it ... First try and then judge," Tkachev said.

Analysts believe that Tkachev is very convenient for the Kremlin, since he actually guarantees complete peace in mind in the objectively difficult region. His resignation, "even for such a significant occasion is unlikely." In addition, it is known that the President treats him "not bad". The Legislative Assembly elections are scheduled for October, and the political regime in the region is ground under the manual control of one person. If Tkachev is removed, the situation will become uncontrollable.



Master-Bank doesn’t know about CEO raided

The Interior Ministry's (MVD) Economic Security and Anti-Corruption Department reported that some leaders of Master-Bank, including CEO Boris Bulochnik, had been searched within investigation on illegal cashing of more than 2 billion rubles. In Master-Bank, this information hasn’t been confirmed or denied.

 Bulochnik has been chairman of Master-Bank since 2001, directly having 5.5% stake in the bank. At the same time, on the whole, the family of Bulochnik controls about 85% of the shares.

 In early July, the Central Bank of Russia informed about the decision to hold Master-Bank administratively liable for violation of legislation on counteraction to laundering of criminal income. It followed from the controller’ data that the decision had been taken in respect of the credit institution itself. It may face the penalty under Article 15.25 of the Code of the Russian Federation on Administrative Violations. According to the media, the penalty amount is going to be 50 thousand rubles.

 MVD confirmed that within the investigation, the former Master-Bank managers of the department on work with big business Sergey Kormschikov and Igor Babich had been detained. According to the police, the heads of several banks created a credit organization in Moscow, without a license and not registered in the Book of the state registration of credit institutions of the Central Bank of Russia. Using some "one-day firms", they transferred funds to the accounts of commercial banks on forged documents, then they threw them to the accounts of other organizations and cashed, the agency informed. For their services, the organizers of the schemes appointed a commission of 3-7% of payment amount.

 For several members of the group, it has been initiated a case of illegal banking activity. Vice-president of the Master-Bank Evgeny Rogachev has been already arrested and charged.


RIA Novosti

Mail Dismissal Prepared for Nikita Belykh

The State Duma is looking for ways to dismiss Kirov region Governor Nikita Belykh for paying his non-staff adviser Alexey Navalny from the regional budget.  Such conclusions were drawn by the deputies on the basis of the hacked e-mail correspondence between the governor and its former adviser that were laid out in the network.

The State Duma accepted United Russia deputy Michael Markelov’ legal request asking the Constitutional Legislation Committee to investigate  the possibility to discharge Kirov governor Nikita Belyh from his post. 231 deputy of the State Duma supported the decision.

The paper noted that it is clear from the published e-mail exchange  between Governor Belykh and that time "non-staff adviser" Alexey Navalny that the head of the region "paid certain services of Mr. Navalny from the budget of the Kirov region". From the correspondence, the facts of "distillery plundering" and "Mr. Belykh’ settling of cases with representatives of the Ministry of Internal Affairs and FSB” became obvious to Mr. Markelov. In the published correspondence between the Kirov region governor Nikita Belyh and the lawyer Alexey Navalny,  the question is a certain sum of money which Navalny, being an adviser on a voluntary basis, demanded from head of the region. A distillery, which was plundered, if to trust Navalny letter, is mentioned in correspondence as well. Belykh and Navalny have confirmed authenticity of the correspondence.

Markelov has noticed that, according to the law, the President can dismiss the head of the subject from his post “due to the Legislative Assembly of the Russian Federation subject has no-confidence on him”. The State Duma has charged the Constitutional Legislation Committee "to inform deputies on possibility to apply the given article on Nikita Belyh". As well, the vice-speaker of the State Duma Sergey Zheleznjak has suggested the Kirov head to retire or at least to suspend powers for the period of investigation.

But Kirov governor has declared that he isn’t going to resign. "I know that nothing bad is behind me", Belykh said. He assured that the story mentioned in the correspondence "doesn't concern neither the budget, nor the region enterprises, and it emerged long before his appearance in the Kirov region”. Besides, the governor noticed that he hasn’t communicated with Mr. Navalny for one and a half year. "All who know the way of Navalny’s interacting, all they can understand", — Belykh noted.


Luzhkov refused to lead the United Petrochemical Company

The epic of the appointment of the former Moscow mayor as United Petrochemical Company (ONHK) chairman of the board (ONHK is a joint venture of Bashneft, which has 74.99%, and Yakov Goldovsky’ Petrochemical Holding) has already lasted for several months. According to the media, the ex-mayor was ready to lead the company, provided the modernization of the enterprises entered and restructuring the company to arrange a united technological chain. Luzhkov estimated the renovation program at 5 billion Euros, 15% of which was to be guaranteed by AFK System. However, Vladimir Yevtushenko refused to give the guarantees, and the ex-mayor did not want to be a “waxwork”, even well-paid.

As a result, the former mayor has been actively engaged in the development of agricultural business based on a stud farm in the Kaliningrad region. This farm was bought by Elena Baturina at the time of horse riding hobby, but when the passion was over, the farm began to come to desolation. 20 horses appeared to be washed-up.

 Initially, Luzhkov had to deal with the farm to prevent the deaths of the animals. Now, basing on the stud farm, he is trying to create a model agricultural enterprise, but already at the family’ expense. The ex-mayor is now so fascinated with the agribusiness, that he has already bought and rented 5,000 hectares of land and planned to rear 5,000 head of sheep.



Kremlin HR body wants court to acquit Khodorkovsky

Presidential council on human rights and civil society development has published a report, containing analysis of the second case of Khodorkovsky and Lebedev.

Tamara Morshchakova, former judge of the RF Constitutional Court and a member of the panel, told local media, that in experts’ view Mikhail Khodorkovsky and Platon Lebedev’s verdict was a “mistake”. Morshchakova added that the council had studied only court documents: text of the verdict, typescript of the hearings and other publicly available documents.

The experts arrived at the conclusion, she said, that former Yukos CEOs had been “punished for carrying out legal activities”: vertical integration of the company with centralized management, agreements to transfer assets from one subsidiary to another, and general agreements. According to the founding of criminal law experts, the RF Criminal Code and Russian criminal procedural law does not contain legal provision to “consider them criminals”. The verdict, the experts believe, violates Russian Constitution and European Convention on Human Rights.

The council urged the Prosecutor General to conduct a retrial, and recommended Russia’s Investigative Committee’s reinvestigating the case, “given newly obtained evidence”. reported earlier, that the council in July had called for general amnesty for economic crimes. The council also called for “liquidation of negative consequences of the similar cases”. It recommended that the jury trial should be applied if a defendant wants it. Another recommendation was to forbid the police to open criminal investigation without written request from an aggrieved party, and to change the procedure of submitting appeals for pardon or suspended sentences.