By John Helmer, Moscow

Oleg Deripaska’s airplane touched down in Cyprus on February 28. He wasn’t on holiday; that came a fortnight later, when he, his plane and his boat had a reunion at Male, in the Maldives. Deripaska left Cyprus on March 2. It isn’t known what was in the luggage offloaded on arrival, or taken on board when the plane departed. Maybe cash, if during the time in Cyprus an informant warned that the newly elected government of Nicos Anastasiades was about to accept a European Union bailout requirement hitting all Cyprus bank accounts with a 9.9% tax on amounts above €100,000; 6.79% on accounts below that amount.

Timing is everything. Eighteen months ago, in September 2010, Alexander Abramov became a citizen of Cyprus. Abramov, who is the second shareholder of the Evraz steel and mining group after Roman Abramovich and his Millhouse holding, was granted naturalization after then-Cyprus Interior Minister Neoclis Sylikiotis announced to the Cyprus cabinet that Abramov was being rewarded because he had “offered [note carefully that word] the highest level of service to the Republic of Cyprus, and considering his business activities, naturalisation is in the public interest.”
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by John Helmer - Sunday, March 17th, 2013
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By John Helmer, Moscow

Who is Mark Kurtser, and what does he do for an honest living?

According to the Kremlin, when he was introduced to President Vladimir Putin last August, Kurtser was Chief Physician of the Centre for Family Planning and Reproduction. Two months later, on the London Stock Exchange (LSE), Kurtser sold a bloc of his shares in a company he established called MD Medical Group (LSE ticker MDMG:LI). This is the first medical services company from Russia to be listed on the LSE. Kurtser, who started with 100% of the shares, sold 35% to the market; took about $100 million in cash for himself; and kept 65% of the shareholding. The umbilical cord for that flotation was the Russian Direct Investment Fund (RDIF), a state funded cash-box which refuses to disclose details of its portfolio or operations. It paid about $50 million, and bought roughly one share of the six on offer.

In the five months since listing, MDMG’s share price has jumped 40%, easily beating most listed Russian stocks — with the possible exception of Abrau-Durso, the champagne maker. Kurtser’s company now has a market capitalization of $1.3 billion, so he is worth, on paper, $830 million. In point of fact, Kurtser is Russia’s leading manufacturer of… babies.
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by John Helmer - Friday, March 15th, 2013
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By John Helmer, Moscow

From small seeds, big truths can be cultivated, pressed, packaged, and retailed profitably. Lies, too.

The elder daughter of Uzbekistan’s president, Islam Karimov, Gulnara Karimova, was so named because in the Uzbek language Gulnara signifies the flower of the pomegranate. The Persians say the same thing.

Last week, after months of negotiation with newspapers worldwide, Karimova issued two press interviews in Switzerland, where she is Uzbekistan’s representative to the Geneva branch of the United Nations. Her effort has been arranged before prosecutors in Switzerland and Sweden file public indictments against Uzbek, Swiss and Swedish company officials for corruption offences, including bribery and money-laundering. They acknowledge they are cooperating with each other; they may be cooperating secretly with the Prosecutor-General of Russia. The deadline for the opening of the Swedish criminal dossier in the Stockholm District Court is July 25.
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by John Helmer - Tuesday, March 12th, 2013
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By John Helmer, Moscow

The UK High Court and the Court of Appeal have now ruled three times to dismiss almost eight years of legal claims by state shipping company Sovcomflot, adding up (with interest and costs) to about one billion dollars. On top, Sovcomflot’s chief executive Sergei Frank (image left, left, tree) has been judged by the British justices to have been personally dishonest; to have procured dishonest or perjured testimony; and last week in the Court of Appeal, to have pursued vindictive claims.

There are two ways for Sovcomflot to avoid the ignominy. The first is to keep appealing, and yesterday (March 11), the Sovcomflot subsidiary Novorossiysk Shipping Company (Novoship) did just that. The second is to persuade the maritime media internationally, and the Russian business media in Moscow, that nothing has happened. For the time being, the media being more susceptible than the judges, the news blackout is proving to be more successful.
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by John Helmer - Monday, March 11th, 2013
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By John Helmer, Moscow

For the second time in its short history, United Company Rusal, the loss-making aluminium monopoly run by Oleg Deripaska, has been ordered out of an international court with the ruling that it has acted unlawfully to seize confidential data of its critics. On March 1, by order of the District Court of Nicosia, Cyprus, Rusal has been ordered to destroy all of the information it had illegally taken. By a second order, Rusal has been required to pay all of the costs of the proceeding to date.

The award of costs against Rusal this time is especially significant. Those who have been the targets of Rusal litigation in the past — they include Russian and Tajik smelter operators, international aluminium traders, and Deripaska’s patron, Michael Cherney (Chernoy) — charge that Deripaska pursues personal feuds employing the company’s lawyers and shareholder resources. By multiplying cases in several international jurisdictions simultaneously, former Rusal lawyers say, he is attempting to crush his targets with legal fees, while exposing the company, not himself, to the costs, losses, and damages.
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by John Helmer - Saturday, March 9th, 2013
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by John Helmer - Thursday, March 7th, 2013
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By John Helmer, Moscow

The UK Court of Appeal yesterday cut short Russian tanker company Sovcomflot’s 7-year lawsuit, ruling that two earlier High Court judgements exonerating the conduct of former chief executive of Sovcomflot, Dmitry Skarga, must stand. The dismissal by the High Court of most of Sovcomflot’s claims against former chartering partner, Yury Nikitin, has also been endorsed in the judgement issued by a 3-judge panel on March 6. At least $8 million in an award to Skarga by the High Court must now be paid by Sovcomflot. In addition, Skarga will seek further compensation from Sovcomflot of at least $1 million for the costs of the failed appeal.

Sovcomflot has yet to issue a statement on the outcome of one of the bitterest cases of maritime litigation ever waged by a Russian state company in an international court, directed by the current chief executive Sergei Frank (title image) against his predecessor. According to Sovcomflot’s last financial report, “On 2 November 2011 the London’s Court of Appeal (Civil Division) granted the Group leave to appeal against certain important elements of the previous Judgement handed down on 10 December 2010. The Claimants’ appeal will be heard by the Court of Appeal in London starting on 4 March 2013.” Sovcomflot is reporting that from its pending appeal litigation in the UK, it stands to gain “in the region of $172.0 million plus interest.”
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by John Helmer - Thursday, March 7th, 2013
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By John Helmer, Moscow

Severstal, the Russian steelmaker owned by Alexei Mordashov (image, far left, far right) reported today that in the final quarter of 2012 the company suffered a loss of $150 million after revenues fell to $3.12 billion, down 13.2% from the third quarter; earnings (Ebitda) contracted 36.4% to $347 million; and operating profit plunged 63.1% to $136 million. These results were significantly worse than Moscow steel industry analysts had been forecasting.

This is not the biggest quarterly loss at Severstal which Mordashov has run up in recent years. In 2009, for example, the first-quarter loss came to $303.3 million; that was topped in the second quarter by a loss of $685.5 million. The third-quarter bottom-line was barely above break-even, but in the fourth quarter of that year, the loss came to $97.3 million. Then Mordashov achieved his worst-ever quarterly loss — $777.9 million in the first quarter of 2010.
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by John Helmer - Wednesday, March 6th, 2013
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By John Helmer, Moscow

Andrei Borodin claims that the case against him for fraud and grand larceny from the Bank of Moscow is politically motivated, and that he is the target of persecution by the Russian law enforcement authorities, acting on the orders of senior officials. He alleges that Prime Minister Dmitry Medvedev is the official giving the orders.

The British Government has considered Borodin’s claims in secret proceedings in which Borodin’s lawyers appeared; the Russian Prosecutor-General and the Bank of Moscow did not. There is no public record of the evidence which was presented; no public record of the judge; no public record of the judgement. Borodin was represented by a law firm which includes the former chief counsel of GCHQ, the espionage agency. He isn’t saying what he did for his client. The Home Office, the cabinet-level ministry in London equivalent to the Ministry of Internal Affairs in Moscow, refuses to say if Borodin has been authorized to remain in the country. It refuses to say if its minister, the Home Secretary, issued Borodin with a residency permit on the basis of a court order, or on the basis of the regulation allowing the minister to grant “discretionary leave”. If Theresa May, the Home Secretary, took such a decision, the one certainty is that the Prime Minister, David Cameron, authorized it.
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by John Helmer - Monday, March 4th, 2013
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By John Helmer, Moscow

New records of the Myre Seadiver’s ill-fated stay at Lagos, Nigeria, have been made available, showing the Lagos port authorities and the Nigerian Navy gave permission for the Russian security vessel to enter the port with a stock of small arms, and that these remained on board at an anchorage in the Lagos roadstead for four weeks, before the 15-man crew and the vessel were arrested by the Nigerian Navy.

The documents also reveal that the Lagos shipping agent for the vessel had applied for and received the required authorizations. “There’ll be no issues”, he wrote to the vessel owner, Moran Security Group in Moscow on September 19.
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by John Helmer - Thursday, February 28th, 2013
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