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“Premier” class Dachas

Comment by Andrey Borodin: Yet another testimony of that the most outspoken corruption fighters from among civil servants can often themselves stand at the top of corruptionist ratings.

Novaya Gazeta

Charitable funds connected with fellow students and relatives of Dmitry Medvedev are investing billions of roubles in development projects.

Many of us go in for collection – and the object of collection depends on the person’s resources. Even if one has no money at all, he can collect match boxes or beer lids. With greater resources, one can concentrate on antiques, works of art, or old automobiles. But only superstars may allow themselves to collect dachas. In the West, they are sports or show-biz stars, and in our country they are also politicians.

The good old Rublyovka, which was out of the focus of public attention, crowded out by the Sochi oasis, is on trend again – especially now, when home is a better place for conspicuous consumption. It is true that owning property abroad is not prohibited for civil servants and their family members yet, but prohibition is implied. In general, against the backdrop of the deoffshorization on the one hand and a constant threat of sanctions on the other, it is better, if your resources are sufficient, to have a dacha on Rublyovka, even if just in case.

By the way, the most curious transaction with Rublyovka property may have remained unnoticed by the public. The mansion (although it would be more appropriate to call it palace) named Eurasia, which before the crisis was the most expensive on Rublyovka and the fifth most expensive in the world according to Forbes, changed the owner. Its price tag at that time read $100 million, fully reflective of the uses of the people who count in billions. However, as research done by Novaya Gazeta shows, Eurasia could be sold at a much lower price. Indeed, there are buyers to whom you give a discount whether you want it or not.

According to the cadastral register, the SotsGosProyekt Foundation became the owner of Eurasia in 2010 (see our Reference Materials below). Practice shows that non-governmental and charitable foundations, especially only one year after their establishment, do not buy Rublyovka dachas, and therefore their ownership may be considered only nominal. Often, a real owner, for example, for political reasons, cannot legally own a property, and he does not need to – the important thing is to have a place where to relax.

The SotsGosProyekt Foundation is not a trust fund or an offshore company, where it would be impossible to trace the connections of the people who have to do with its operation. Sometimes, they are family connections – SotsGosProyekt is directly connected with the employment of Andrei Medvedev, the prime minister’s cousin (see our Reference Materials below). Indeed, anyone may want to employ relatives of high-level bureaucrats and Voroshnevo Village, Kursk Oblast, where the firm of Medvedev the cousin operates, is far removed from Rublyovka.

The founder of SotsGosProyekt, Vitaly Golovachov, is a well-known personality in the business world, and theoretically he could buy Eurasia for himself. But why then would he register the property in the name of the foundation? So as not to make a show of his property ownership? Yet it is obvious that Golovachov is not concealing his participation in SotsGosProyekt.

A further research of his business contacts easily establishes his connection with the Dar Foundation of non-commercial projects, and this organization is already very well known to the readers of Novaya Gazeta. Back in 2011, in our story “Presidences” (see No. 17 of 15 February), we told about Dar, which officially rented a land plot in Krasnodar Territory within the Bolshoy Utrish natural preserve, where construction plans were under way for elite property that market participants had called “Medvedev’s dacha,” apparently because the supervisory board of the Dar Foundation was headed by Ilya Yeliseyev, then deputy chairman of the GazPromBank board. Coincidentally, the foundation was one of the major customers of the bank: the share of the Dar Foundation Management Company, Ltd., amounted to 2 per cent of the credit portfolio. The dollars-and-cents figure, however, is more interesting here than the percentage: the bank gave the non-profit organization a loan in the amount of $460 million – an unprecedented event on the market, especially for the 2008 meltdown year.

Naturally, Dar did not start from scratch; its founder is Levit, Ltd., whose owners were Leonid Mikhelson (now Gennady Timchenko’s partner in Novatek) and Leonid Blavatnik. But at that time GazPromBank still had control of Novatek. It turns out that the bank was financing projects of the foundation belonging to major customers and partners, and headed by its own deputy chairman into the bargain.

The key figure in this story appears to be Ilya Yeliseyev after all, and even more precisely, his fellow student Dmitry Medvedev. Dar flourished precisely during the latter’s presidency, and its best-known projects are related to dacha-type properties.

In fact, our interest in the foundation’s activities in 2010 emerged on the wave of public uproar over the illegal cutting down of ancient woodland in Urtish to build a road for the future residence. Largely because of the public indignation, the project was put on a back burner. Nonetheless, Dar did not give up the idea to build an elite dacha in Sochi ahead of the Olympics. It follows from reporting of the 2014 Olympics Organizing Committee that the foundation acted as investor in the construction of a reception house for official visitors, Psekhako. Apparently, those are highest-level visitors, since all work on the project, pursuant to an order from FSB Director Bortnikov, was to be coordinated with the federal security bureau. The size of the investments is also impressive: more than 1.8 billion roubles. Unlike sports Olympic facilities, Psekhako will hardly stay empty. Its level fully corresponds to the needs of a high-level Russian bureaucrat – even a prime minister, all the more so since Dmitry Medvedev prefers downhill skiing to pebble beaches, and from that point of view Psekhako is much better than Utrish.

Fishing is believed to be another hobby of the prime minister. Coincidentally, another elite property in Dar’s collection is located on the Volga. It is a rebuilt estate of the Chernevs in Ivanovo Oblast, rather, one built anew. (Russian landowners knew the value of dacha retreats, and the new elite has examples to learn from.) Dar bought out the property back in 2009, but now, as Novaya Gazeta sources say, the formal ownership is switching to— SotsGosProyekt.

The name, by the way, sounds similar to ‘sobes’ [social security], which, coincidentally, reflects changes in the investment strategy and goals. Dar was an active and even aggressive investor, whereas SotsGosProyekt gets its way quietly, without excessive risk, just like a pension fund of sorts.

Scandals with country property for the Russian elite are a familiar story and something customary. It could be that at some genetic level the Soviet standard of wellbeing shows, where a Central Committee dacha was an accessory of the party elite and outstanding public figures treated in the same way. Yet, the stories related to Dar and SotsGosProyekt are not making a good scandal yet, because the subjects touched by the public opinion have long been expected to outline somehow their stance.

This concerns both the non-governmental foundations specializing in premium development and prime minister Dmitry Medvedev. We have sent official inquiries to the SotsGosProyekt Foundation and the press secretary of the Russian prime minister, Natalya Timakova, and we expect that detailed and grounded responses will make it possible to conclude the “dachas” discussion.

Novaya Gazeta Reference Materials
As already told by Novaya Gazeta, in the early period of its activity, the Dar Foundation was indirectly tied not only to fellow students of Dmitry Medvedev but also to members of his family. A limited-liability company belonging to the foundation, the Dar Foundation Management Company, Ltd., was located at the same address as the Foundation of Socio-Cultural Initiatives (FSCI) of the president’s spouse Svetlana Medvedeva. According to the SPARK database, the general director of the FSCI and the Dar Foundation Management Company was Olga Travina. FSCI deputy general director Dmitry Solovyov told Novaya Gazeta earlier that Travina was heading the North-western subsidiary of Dar in 2006 but five years later had nothing to do with the foundation.

The SotsGosProyekt Foundation was established in late 2009 by Vitaly Golovachov. At that time, the foundation had modest assets: its fixed assets amounted to only 4 million roubles, and a little over 20 million roubles were on the organization’s accounts. However, that did not prevent the foundation from conducting a major transaction only one year later: the acquisition of a mansion on Rublyovskoye Shosse, according to Forbes, could cost the new owner $100 million. Could the foundation buy the property at a discount? According to accounting under Russian Accounting Standards for 2011, it could: SotsGosProyekt assets already after the purchase of the mansion amounted to about 318 million roubles, of which 164 million roubles were material non-turnover assets, including fixed assets as well as incomplete capital investment in fixed assets.

It looks like the foundation itself from the time of its establishment was not conducting any commercial activity – its bottom lines for 2011 and 2012 showed zero proceeds, and an insignificant profit was formed by the sale of property. In this connexion it would be logical to infer that funds for the purchase of the mansion in the Moscow area were obtained by SotsGosProyekt from the founder or a third person, for example, in the shape of a bank loan.

GazPromBank reporting for 2010 shows no loan issued to SotsGosProyekt.

The founder of SotsGosProyekt, Vitaly Golovachov, had not figured in projects related with the prime minister, even though he heads the Orinion LLC, a subsidiary and management company of the Dar Foundation of regional non-commercial projects, which is considered to be close to Medvedev and acting GazPromBank board chairman Ilya Yeliseyev. Golovachov himself is a strategic investor of the GlavKino group of companies, one of the largest Russian cinema concerns, which has a complex of pavilions on Novorizhskoye Shosse (where, for instance, Stalingrad was filmed). According to the GlavKino official website, the company was established in 2008 by director Fyodor Bondarchuk and producer Ilya Bachurin in equal shares; later, Channel One general director Konstantin Ernst joined the founders; Golovachov, according to the company itself, joined the cinema club in 2010 as a strategic investor and owns a 50-per cent share in the group.

The SotsGosProyekt Foundation, via the KurskPromTeplitsa Closed Joint-Stock Company, controls the Seym-Agro Closed Joint-Stock Company in Voroshnevo Village, Kursk Oblast (operating in crop production). A co-owner of 5 per cent of shares and general director of the latter is the prime minister’s cousin Andrei Medvedev.

On 30 December 2013, Alexei Chetvertkov was appointed SotsGosProyekt Foundation general director; he is Dmitry Medvedev’s fellow university student and has moved to the capital city, according to media reports, under the patronage of Ilya Yeliseyev. Apart from the foundation, Chetvertkov controls several companies doing business in brokerage. However, according to people who knew him in his university years, Chetvertkov had always been known as a creative personality: his hand rocked the cradle of the Glagol People’s Theatre, where he took part in numerous performances.