Sergei Storchak

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Sergei Storchak Сергей Сторчак
Deputy Finance Minister of Russia
Incumbent
Assumed office  November 2005
Born	June 8, 1954 (1954-06-08) (age 54) Olevsk, Zhytomyr Oblast, Ukraine SSR, Soviet Union
Nationality	Russian
Political party	No affiliation

Sergei Anatolievich Storchak (Russian: Сергей Анатольевич Сторчак) (born June 8, 1954 in Olevsk, Zhytomyr Oblast, Ukraine SSR)^[1] is a Deputy Finance Minister of Russia. Storchak became one of Russia's three deputy finance ministers in November 2005. He has specialized in international financial relations, and has been a prominent figure in negotiations over paying off Soviet-era debt. He negotiated Russia's repayment of its debt to the Paris Club of creditor nations, which it completed last year.^[2] Storchak also oversees the $148 billion stabilization fund, which collects revenues from oil exports.

Contents 1 Detention 1.1 Suspects 1.2 Criminal investigation 1.3 Reactions 2 Notes 3 External links

[edit] Detention

[edit] Suspects

On November 15, 2007, Storchak was detained by the Russian police as a part of a criminal investigation. "The detention took place outside the ministry. It may be related to criminal cases against a third party, not finance ministry officials," the ministry said in a statement.^[3] Prosecutors later confirmed the detention of Storchak and two businessmen on suspicion of "attempting large-scale embezzlement from the Russian state budget through fraud".^[4]

The two businessmen were later confirmed as Viktor Zakharov, general director of Sodexim^[5], a little-known Moscow-based firm; and Vadim Volkov, president of the Interregional Investment Bank (MIB)^[6] in Moscow. MIB labels itself as "one of the largest investment banks of the Russian Federation" /.../ "Basic credit and investment activities are shipbuilding, development of mineral deposits, high technologies".^[7] Sodexim, which organized a Russian medical equipment exhibition in Baghdad in 2002, is listed on MIB's web site as one of its top clients. It undertakes "various trade operations" and carried out 13 million rubles ($530,000) worth of business last year, Interfax news agency said.^[8]

[edit] Criminal investigation

Storchak, Zakharov and Volkov have not yet been formally charged with any crime. But the investigation committee at the Prosecutor General's Office said in a statement on November 19 that the three detainees were suspected of having created an organized group to embezzle budget funds of $43.4 million under the pretext of covering expenses for Sodexim.^[9]

On November 20, the Investigation Committee elaborated its suspicions that the $43.4-million figure might be a form of a secret bribe for government officials who were involved in payments between the government and private enteties. "Investigators have found out that it was this amount which went with the legitimate debt which Sodexim bought from a state-owned defense company and which was supposed to be paid off by the Russian Finance Ministry," a source close to the investigation told Interfax news agency. And the government's debt to Sodexim was to be redeemed through MIB. Its director Volkov knew Storchak from his previous employment at the Finance Ministry as deputy minister.^[10]

A source close to the investigation told Reuters that the detention of Storchak is part of a probe into the theft of state funds in debt deals, including with Iraq. "There is a big group of people under investigation and there will be new detentions. It is all related to our state debt and the schemes of its redemption, when up to 30 percent of funds were disappearing," the source told Reuters. "Storchak was detained because he was signing all (the debt-related documents). A number of banks are involved ... and people in the government administration," the source added.^[11]

The criminal investigation committee said that Storchak had been detained to prevent the destruction of evidence. "The investigation possesses evidence that if Storchak had been left a free man, he could escape the investigation and the trial, engage in criminal activities, threaten witnesses... and destroy evidence," the committee said.^[12] The head of the committee has said that the equivalent of $1 million in cash had been found in a search of Storchak's apartment.^[13] His lawyer has stated that this cash was being saved towards the purchase of a vacation home for his family, and that the amount found is not incompatible with his compensation during his prior employment as Deputy Chairman of Vneshekonombank.^[14]

[edit] Reactions

A source close to Finance Minister Alexei Kudrin told Reuters he "could not rule out" that the detention was part of a campaign against Storchak's powerful boss ahead of the parliamentary election on December 2. President Vladimir Putin promoted Kudrin, his long-term ally, to the rank of Deputy Prime Minister in a reshuffle in September.^[15]

Ekho Moskvy radio station and Interfax news agency reported, quoting unidentified sources, that Storchak had been due to fly to South Africa on November 15, for a meeting of finance ministers of the 20 most industrialized and important emerging economies. But he did not show up on the government's plane. In South Africa, Kudrin defended his deputy and urged a fair investigation^[16] Storchak last spoke publicly the same day he was detained when he criticized the central bank's proposal to start using the open market to convert Russian rubles into foreign currencies for the stabilization fund.

[edit] Notes

[edit] External links

• Ministry of Finance of Russia Official website

Persondata
NAME	Storchak, Sergei
ALTERNATIVE NAMES	Storchak, Sergei Anatolievich; Сторчак, Сергей Анатольевич (Russian)
SHORT DESCRIPTION	Deputy Finance Minister of Russia, Director of the Finance Ministry International Financial Relations, National Debt and Financial Assets Department
DATE OF BIRTH	June 8, 1954
PLACE OF BIRTH	Olevsk, Zhytomyr Oblast, Ukraine SSR
DATE OF DEATH	living
PLACE OF DEATH