Sunday, February 13, 2011

Russia's Deputy Prime Minister Replaces Olympic Building Head

Yesterday's news, today here at Sochi Watch! 

A couple of weeks ago, Taimuraz Bolloyev, head of the state-owned "Olimpstroi," the company in charge of all the Olympic Construction in Sochi, resigned from his post, citing health reasons.  Pretty benign, right?  Well, except for the fact that this means that Olimpstroi is now on its fourth CEO in three years.  Oh, and the fact that corruption rumors continue to swirl around the company and the project.  Thus spake the newly renamed Moscow News (formerly Moscow Times):
Clouds are gathering over the state-owned company in charge of delivering the Sochi Winter Olympic complex following the resignation of Olimpstroi CEO Taimuraz Bolloyev.  Bolloyev is stepping down on health grounds – but his departure came just two weeks after Dmitry Medvedev demanded an audit into government spending for the 2014 games.
And the very day Bolloyev bowed out Olimpstroi were facing the fraud squad. 
The Krasnodar region Investigative Committee has filed 27 cases of corruption among government circles and companies in Sochi.
“There has been considerable work to identify the facts and investigate cases of corruption among local government employees and the law enforcement system in preparation for the Olympic games in 2014,” Alexei Kramarenko, Sochi Investigation Department head, told Interfax on Monday.
Six criminal cases have been opened against senior members of the state corporation Olimpstroi, over a fictitious project which involved fake documents and which siphoned off more than 23 million roubles, he said.
This entire situation deserves a bit of background before we dive headlong into this most recent allegation of corruption

In the summer of 2010, an article on Christian Science Monitor (which drew heavily on a Novaya Gazeta story) was, as far as I can tell, the first widely-disseminated report in English on corruption in the bidding process for contracts in Sochi.  The complainant, Valeri Morozov, who owns a company that bid for a building contract in Sochi, is the rare individual speaking out against the entire process.  And here's the interesting part: Morozov freely admits to paying a bribe in order to secure a construction contract.  His gripe is that, despite all this, he was denied the contract.  Morozov even fled the country after speaking out, a testament to the particulary precarious situation for whistle-blowers within Russia.

In response to this entire episode, President Dimitri Medvedev lauched an investigation into the bidding process.  All of this was an extension of Medvedev's campaign promise to root out corruption within Russia, something that has become a fact of life businesses and people in post-Soviet Russia; you pay the bribe, account for it, and move on.  Cost of doing business.  Since his election, there's debate as to whether Medvedv is serious about rooting out corruption or whether this is a pr campaign.  That debate is a whole 'nother ball of wax. 

And here we are again less than one year later, with a 'coincidental' resignation of Olimpstroi's 3rd boss, all while Deputy Prime Minister Dimitri Kozak, the man nominally in charge of the whole operation, denies any connection between the 27 pending fraud charges and Bolloyev's resignation.  Said Kozak: “There were no facts presented concerning abuse or corruption at either SC Olympstroy or any other authority body, despite the close scrutiny from a number of different bodies."  Sure.  

Bolloyev is being replaced by Sergei Gaplikov, another government lifer with no experience in construction.  There's not a lot out there in English about Mr. Gaplikov, but Novaya Gazeta mentions that he entered into public service in 1994 as member of the advisory council on the Budget Committee.  It also quotes an unnamed source as saying something to the effect that Bolloyev's resignation was not connected to his health but, rather, that he had planning his exit for more than a year, frustrated by having to balance three "centers of power:" the White House, Deputy PM Kozak and his staff and the leaders at Olimpstroi.

Or, you may prefer the reason given by oppositionist and former Sochi mayoral candidate Boris Nemtsov, an outspoken critic of the environmental trauma to the region brought on by this project.  In his mind Bolloyev left for the same reason the other two former heads of Olimpstroi did: when they realized the scale of the damage being done to the environment, they left -  "They don't want that sin on their soul."

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