By John Helmer, Moscow

Iskander Makhmudov (right image) is cultured, charming, gracious, hospitable, polite, discreet – he has more of these qualities than his oligarch peers.

But for Oleg Deripaska, his junior in the division of the Russian metals businesses that took place between 1995 and 2000, before the formation of Russian Aluminium (Rusal), here’s what Mark Howard said in the UK High Court last week: “[Makhmudov’s] role in these proceedings we suggest raises serious difficulties for Mr Deripaska’s case on a fundamental level. Indeed, we suggest he is very much the elephant in the room.”
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by John Helmer - Tuesday, July 17th, 2012
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By John Helmer, Moscow

A year is a long time in Russian politics, and Vladimir Putin isn’t the same man he was a year ago.

Then — on July 15, 2011 — he visited Magnitogorsk, presided at the official commissioning of the new automotive steel production line known as Mill-2000, and spent three hours answering questions from the workers of Magnitogorsk Metallurgical Combine (MMK). This Monday, July 16, Putin was back at MMK, pressing the button alongside MMK owner Victor Rashnikov to inaugurate two sub-sections of a sub-production line. The Kremlin has (so far) released no record of what was discussed with the steelworkers.

Rashnikov is also a changed man. In between the two Putin visits, Rashnikov attempted to invest half a billion dollars of MMK’s cash, and $1.5 billion in borrowed money, some of it from a state-controlled Russian bank, in an Australian iron-ore mining project known as Flinders Mines twelve thousand kilometres away. Then in late March Rashnikov suffered an abrupt loss of will and change of mind. Twelve weeks later, at the start of July, he formally withdrew from the entire scheme. Not once did Rashnikov explain what he was doing.
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by John Helmer - Tuesday, July 17th, 2012
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By John Helmer, Moscow

Look carefully at who is in the driving seat.

The records of RTI Limited (formerly Rusal International Trading), the next to highest control entity in the corporate organization of United Company Rusal, show that it was registered on October 27, 2006, one day after the parent company was registered. At the time, the parent’s capital consisted of 10,000 nominal shares, and according to Point 6 of its memorandum of association, each Rusal share was worth one US dollar. A few weeks later, the parent’s annual return declared its shares were now worth one English pound, and that just two of them had been paid up. The owner of these two was EN+, not identified then as a personal holding company of Oleg Deripaska’s. By February 28, 2008, in Rusal’s next annual return, the shares were again denominated in US dollars, and all 10,000 were paid up. We’ll come shortly to who owned them.

According to the printed notes of the Jersey companies form, “the Annual Returns cannot be accepted until they meet the requirements of the Companies (Jersey) Law 1991, as ammended [sic].” There’s a lot the Jersey authorities don’t do in conformity with accepted practice – spelling is just one of them.
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by John Helmer - Sunday, July 15th, 2012
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By John Helmer, Moscow

Norilsk Nickel has declared war on Alexander Popov (image centre), a 57-year old veteran of the oil industry and the new head of the Federal Agency for Subsoil Use, Rosnedra. In the circumstances this can mean only one thing — Vladimir Potanin (right), the dominant shareholder of Norilsk Nickel, has decided on a duel with Igor Sechin (left), former deputy prime minister and now chief executive of Rosneft. This is because Popov’s job for the past eighteen months has been as an assistant to Sechin; when Sechin left his government office in May, he put Popov in charge of Rosnedra’s key function – awarding licences for oil, gas and hard-rock mining. Sechin is also believed to have been behind Popov’s predecessor, Anatoly Ledovskikh, who decided last October not to allow Norilsk Nickel to extend its mining rights in the Norilsk-1 area on the ground that, though it is already mining in the area, it was the sole bidder for the adjacent mining rights.
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by John Helmer - Thursday, July 12th, 2012
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By John Helmer, Moscow

Fifteen years ago, the American Journal of Psychiatry reported research that not all obsessive-compulsive disorders are alike. Two individuals with obsessive-compulsive disorder, the scientific evidence showed, may have totally different and non-overlapping symptom patterns. For example, the obsession with counting, hoarding, arranging and collecting doesn’t usually accompany the compulsion for hand-washing, religious ritualism, sexual aggression, or vice versa.

At yesterday’s opening presentations in the UK High Court in the case of Michael Cherney v Oleg Deripaska, the evidence of Deripaska’s meticulously recorded and coded account books was revealed for the first time. No major Russian business figure has ever been obliged to reveal such intimate financial data in a public forum. “The balance sheets,” according to Cherney’s advocate Mark Howard QC, “are documents of the utmost importance in the case.”
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by John Helmer - Tuesday, July 10th, 2012
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By John Helmer, Moscow

Oleg Deripaska’s sole defence against having to pay Mikhail Chernoy (Michael Cherney) the dividends, assets, interest, and the corpus of his patron’s stake in United Company Rusal is that Cherney extorted the money by presenting him with a trust agreement and contract, and threatening to break his bones if he didn’t sign it. This is the gangster defence. It has already been curtailed by several preliminary UK High Court rulings; Justice Christopher Clarke, who presided in the trial of the jurisdiction issues in the case, ruled that he didn’t believe it.

But there is one respect in which it is almost certainly true that someone tough has been forcing Deripaska to run Rusal the way he has. That man, the control shareholder of Deripaska’s nominal 47.41% shareholding, is Boris Yeltsin.
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by John Helmer - Monday, July 9th, 2012
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By John Helmer, Moscow

An 8-year long case charging Oleg Deripaska and his Russian Aluminium (Rusal) group with fraud and corruption in acquiring aluminium assets, gas and electricity supply and port outlet in a rigged privatization scheme has ended in Deripaska’s defeat and the loss of his assets. The court ruling was issued on Friday, July 6. In Nigeria.

On the eve of the start of Mikhail Chernoy’s (Michael Cherney) trial for recovery of his 13% shareholding in Rusal, to commence in the UK High Court today, the Nigerian Supreme Court judgement by a unanimous 5-judge panel is automatically endorsed by the US federal court, which had ceded jurisdiction over Rusal for the claim, on condition Deripaska submitted to the Nigerian courts. The ruling cannot be appealed; and for an asset which cost $3.8 billion to build, it is the most costly defeat Deripaska has suffered in the international courts to date.
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by John Helmer - Sunday, July 8th, 2012
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By John Helmer, Moscow

A century ago and longer, the Ottomans understood not to press the Russians in close encounters; the Turks are slow learners. After several recent episodes in which the Turkish armed forces have attempted to interfere with Russian vessels delivering cargo to Syria, the Russians have now delivered the message that Turkish cargoes headed for Russia may be stopped altogether.

The subtlety of this message has yet to be detected by the Anglo-American war media. They are still blustering over the message the Syrians delivered when they used Russian-made cannons to shoot down an American-made Turkish spy plane over Syrian territory on June 22.
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by John Helmer - Friday, July 6th, 2012
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By John Helmer, Moscow

Money laundering is one of those things that is usually accompanied by a lot more gossip than conviction. Exactly what gets washed and for whose benefit are difficult to pin down, usually because those who do it are smarter than your average washerwoman. Still, if the Swiss money police are on the case, that’s so unusual, there’s bound to be more than the customary ladies’ chatter. For Gunvor, the Geneva-based oil trader which has been the foundation of Gennady Timchenko’s (image right) fortune, the police make a novel experience. And one such experience might become a precedent for others – or at least that’s what the washerwomen on the bank of Lake Geneva were surmising before their picture was taken.

What is being reported authoritatively this week is that there was a Swiss police search of the Gunvor offices overlooking Lake Geneva in January. Either before, or not long after, the Swiss federal prosecutor opened a formal investigation of suspected money laundering by person or persons unknown. At least one Swiss bank account is reported to have been frozen as part of the ongoing investigation. This has happened at Bank Clariden Leu, a Zurich-based private institution which was part of the Credit Suisse holding until April of this year, when it merged and ceded its name to the Credit Suisse brand.
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by John Helmer - Thursday, July 5th, 2012
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By John Helmer, Moscow

Oleg Deripaska, chief executive of United Company Rusal, is prosecuting his old friend and Rusal veteran, Andrei Raikov, on charges already dismissed by the Moscow police and the Moscow courts, because Raikov, according to his representatives, has refused to testify for Deripaska against another old friend, Mikhail Chernoy (Michael Cherney).

Cherney’s 6-year lawsuit in the UK High Court to recover his 13% shareholding in Rusal, and enforce the shareholding contract and trust agreement he and Deripaska signed in March 2001, goes to trial next week. Lawyers for Cherney and Deripaska will present summaries of their positions, before the court adjourns for the summer recess. Witness testimony and cross-examination will start when the court resumes on October 1.
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by John Helmer - Monday, July 2nd, 2012
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