February 19, 2019

February 18, 2019

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Russia Continues Anticorruption Efforts in 2019

Russia continues its anticorruption efforts in 2019. These efforts build upon numerous convictions last year.  In January 2019, despite the two-week public winter break, two significant cases developed. Beyond seeking additional convictions, the Russian government will implement public anticorruption outreach this year.

2018 Review

Russia’s Prosecutor General Yuri Chaika summed up the agency’s 2018 year-end results. He reported 7,800 corruption convictions in 2018, including of 837 law enforcement officers, 63 elected officials at regional and municipal levels, and 606 federal, regional, and municipal employees. Among them was Sahalin Region’s former governor, Aleksandr Horoshavin, sentenced to 13 years in prison for bribery and money laundering.

 January Results

On January 15, the Prosecutor General’s Office of Russia revealed “sensational” results of its investigation of Aleksandr Shestun, a former head of the Moscow Region’s Serpukhov District.  According to the Russian government, Shestun owns over 676 real property assets, including 565 land plots, and 22 cars, registered in names of his relatives and shell companies.  Shestun allegedly obtained real property by auctioning to himself state land by fraudulent means. The government estimates the property’s total value is 10 billion rubles (US$150 million). Because this amount “does not correspond in any way to his official income,” on January 17, the Russian prosecutors filed a forfeiture claim to confiscate the property.  Shestun is charged with embezzlement, money laundering, and illegal entrepreneurship.

Also, after years of negotiations, on January 3, France extradited to Russia Aleksei Kuznetsov, wanted on fraud, misuse of funds, and money laundering counts. Kuznetsov served as finance minister for the Moscow Region between 2000 and 2008. The Russian government alleges losses of more than 14 billion rubles ($211 million) to the regional government.

 Government Initiative

On December 29, 2018, the Russian government awarded 46 million rubles (US$690,000) to a private company to direct discussions on anticorruption and civil-society development across the country. During 2019, the contractor will conduct 135 events in Moscow, Saint Petersburg, Crimea, and 17 regions in Russia.  These will include round table discussions, lectures, seminars, forums, and conferences. The company will also conduct social polling and in-depth interviews.

 What Will the Future Bring?

It is not yet clear what impact the public anticorruption outreach will have on Russia’s future prosecution activity. Will the audience of the outreach be Russian citizens generally, corporations, government officials, or all of the above? Similarly, will Russia continue its trend in recent years of prosecuting corrupt government officials, rather than corporations and corporate executives? Much remains to be seen.

© Copyright 2019 Squire Patton Boggs (US) LLP

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About this Author

Kristina V. Arianina Squire PB Litigation lawyer
Senior Associate

Kristina Arianina represents companies and executives in internal investigations, enforcement actions and commercial litigation. Her investigation practice includes bribery and securities fraud allegations and violations of US economic sanctions and the Foreign Corrupt Practices Act (FCPA). She conducts internal investigations and due diligence in the US and globally, assists clients with disclosures of potential violations to relevant authorities, represents clients in enforcement matters, and helps companies develop and implement compliance policies and strategies for their domestic and...

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