Sergei Storchak

Infobox Officeholder
name = Sergei Storchak Сергей Сторчак


imagesize = 150px
nationality = Russian
order = Deputy Finance Minister of Russia
term_start = November 2005
term_end =
predecessor =
successor =
birth_date = birth date and age|1954|6|8
birth_place =
death_date =
death_place =
spouse =
party = No affiliation

Sergei Anatolievich Storchak ( _ru. Сергей Анатольевич Сторчак) (born June 8 1954 in Olevsk, Zhytomyr Oblast, Ukraine SSR) [ [http://www1.minfin.ru/org_str/storchak.htm Сергей Анатольевич Сторчак] Official website of the Ministry of Finance of RF.] 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. [ [http://ap.google.com/article/ALeqM5jScjz8ychON9m2pxHnXFtvQpdHcAD8SV067G0 Russian Deputy Finance Minister Detained] Associated Press, November 16, 2007.] Storchak also oversees the $148 billion stabilization fund, which collects revenues from oil exports.

Detention

uspects

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. [ [http://www.reuters.com/article/bondsNews/idUSL1643449420071116 Russian police detain deputy finance minister] Reuters, November 16, 2007.] Prosecutors later confirmed the detention of Storchak and two businessmen on suspicion of "attempting large-scale embezzlement from the Russian state budget through fraud". [ [http://www.interfax.ru/e/B/politics/28.html?id_issue=11912153 Prosecutors confirm detention of Russian Deputy Finance Minister Storchak] Interfax, November 17, 2007.]

The two businessmen were later confirmed as Viktor Zakharov, general director of Sodexim [ _ru. Содэксим] , a little-known Moscow-based firm; and Vadim Volkov, president of the Interregional Investment Bank (MIB) [ _ru. Межрегиональный инвестиционный банк (МИБ)] 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". [ [http://www.bankmib.ru/cgi-bin/cm/get_doc.fpl?tree_id=1 Interregional Investment Bank] ] 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. [ [http://www.themoscowtimes.com/stories/2007/11/19/002.html Deputy Finance Minister Arrested] The Moscow Times, November 19, 2007.]

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. [ [http://www.interfax.ru/r/B/politics/2.html?menu=1&id_issue=11913202 Сторчак подозревается в покушении на хищение из федерального бюджета более $43 млн - Следственный комитет] , Interfax, November 19, 2007.]

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. [ [http://www.interfax.ru/e/B/politics/28.html?id_issue=11913644 Eight-digit sum in Storchak case could be hidden form of bribe - source] , Interfax, November 20, 2007.]

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. [ [http://africa.reuters.com/world/news/usnL17190149.html Russia probes debt deals as top official detained] Reuters Africa, November 17, 2007.]

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. [ [http://africa.reuters.com/wire/news/usnL19244108.html Russian official suspected of $43 mln fraud] , Reuters, November 19, 2007.] 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. [ [http://www.reuters.com/article/bondsNews/idUSL0651204620071206?pageNumber=2&virtualBrandChannel=0] , Reuters, December 6, 2007.] 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. [ [http://www.bloomberg.com/apps/news?pid=20601095&sid=aqRDNHWdB2ZY&refer=east_europe] , Bloomberg, December 5, 2007.]

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. [ [http://www.reuters.com/article/bondsNews/idUSL1643449420071116 Russian police detain deputy finance minister] Reuters, November 16, 2007.]

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 [ [http://africa.reuters.com/world/news/usnL17190149.html Russia probes debt deals as top official detained] Reuters Africa, November 17, 2007.] 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.

Notes

External links

* [http://www1.minfin.ru/ 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 =