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Wednesday, October 31, 2007

Annals of Russia's Keystone Cops Show

The Moscow Times reports:

It's a miracle a gunfight didn't break out.

On Oct. 1, a group of heavily armed officers from the Federal Security Service and the Investigative Committee were waiting at Domodedovo Airport for a senior drug police officer to arrive. They had orders to arrest him. But a group of Federal Drug Control Service officers standing nearby had orders to protect him. A scuffle broke out, but the arresting officers eventually walked away with Alexander Bulbov and two of his colleagues in custody. "We nearly had a fight between two security agencies," said a former security services officer familiar with the situation. "This time, the agents were able to keep their cool, and there was no gunfight. But if this battle continues, you can be sure they will start shooting at each other. And it would be difficult to stop."

Bulbov's arrest has brought to the surface one of the numerous behind-the-scenes battles between two Kremlin clans that form the bedrock of President Vladimir Putin's team. Speaking on condition of anonymity because of the sensitivity of the issue, three former security services agents with intimate knowledge of the power struggle said the infighting had its roots in commerce, not politics or prestige. The fight is primarily over control of smuggling and money-laundering operations, and Putin is merely a referee trying to prevent one group from prevailing over the other, they said. "On top of their suspicious commercial activities, each clan wants to have the president -- and the power he enjoys -- in its hands. And the only way for Putin to preserve his independence is to keep the balance between the two groups," the former officer said. "Putin understands that if one group takes over, he will completely fall into the hands of a single group. And he doesn't want that."

Such intrigues have long characterized Putin's Kremlin, but the battles are intensifying with Putin's repeated promises to step down when his second term ends next year, as required by the Constitution. "Putin has chosen a very dangerous scheme to transfer his power," said another former officer, a veteran of the KGB and FSB. "He should have changed the Constitution to stay at the helm. This would have been a clear move, and the clans would have been assured stability. We wouldn't have this public fight going on now." A lot is at stake, and the clans don't understand what is going to happen from one day to the next, he said. "They are very nervous."

Eight days after Bulbov's arrest, his boss, Federal Drug Control Service chief Viktor Cherkesov, wrote in an article in Kommersant that the security services were embroiled in internecine feuding over power and influence. "You cannot be a trader and a warrior at the same time," he wrote. "It does not work." Bulbov stands accused of ordering illegal wiretaps and accepting bribes from private firms in exchange for official protection. But Bulbov said his arrest was revenge by the FSB for his investigation into Tri Kita, a Moscow furniture store accused of evading million of dollars in import duties and smuggling Chinese goods through FSB storage facilities. Media reports have linked senior FSB officials to the business. Bulbov's wife, Galina Bulbova, said at a news conference Thursday that "very famous surnames were involved" in her husband arrest, Reuters reported. She would not elaborate. The drug control agency had an active role in the Tri Kita investigation, which last year led to the ouster of several high-ranking officials in the FSB and the Prosecutor General's Office. But the sources interviewed for this article said Bulbov's arrest was not about revenge. "This is a fight," the first former security services officer said. "You don't have good guys and bad guys here. You have a lot of financial interests."

Kremlin and FSB officials deny any battle is going on between security services. "The fight is only happening in journalists' imaginations," an FSB official said on condition of anonymity because he was not authorized to talk to the media. "Believe me, no war is going on." Kremlin spokesman Dmitry Peskov said talk of an ongoing fight was only "fantasy." "I cannot comment on an issue that does not exist," Peskov said. "We don't have clans."

The Clans

The former security services agents interviewed for this article said two clans were battling to control the Kremlin and take over contraband and money-laundering operations. The first, they said, is led by Igor Sechin, Putin's powerful deputy chief of staff and includes FSB head Nikolai Patrushev, FSB deputy chief Alexander Bortnikov, Putin aide Viktor Ivanov, and Alexander Bastrykin, head of the newly created Investigative Committee, a semi-autonomous agency under the auspices of the Prosecutor General's Office The second clan, they said, is led by Cherkesov and Viktor Zolotov, head of the president's personal security service. Prosecutor General Yury Chaika also belongs to this group, which enjoys good relations with First Deputy Prime Ministers Dmitry Medvedev and Sergei Ivanov, they said. "Both groups are on good terms with Putin and the new prime minister, Viktor Zubkov," a third former intelligence agent said. "But because of the many commercial interests they have in common, they cannot live together. Each of them dreams about getting rid of the other."

The fiercest battle is over control of customs, the former security services agents said. Each group controls certain checkpoints where goods imported by firms they protect are given a free pass at the border, saving the firms millions of dollars in duties, they said. The money the firms pay for the protection and service is subsequently laundered through reputable banks, the former agents said. "There were cases when trucks full of Chinese goods were escorted by FSB special forces," the first former security services officer said. There have also been cases of shootouts between security agencies after one group nabbed smugglers protected by the other group, the former agents said.

The current danger, they said, is that the situation could spin of control.

"We are talking about people with lots of weapons," the first former security services officer said. "They have a lot of security units working for them. And on top of that, the businesses they protect have their own security services." FSB and Investigative Committee officers tried to search Bulbov's dacha days before his arrest but were held off by Federal Drug Control Service officers, the former officer said. "I know that for about five hours they were shooting at each other," he said. "Can you imagine that? Two special services from the same country shooting at each other like criminals."

A Balancing Act

Putin's response to the infighting has been one of mixed signals that the former security services agents say are meant to maintain equilibrium between the clans and prevent either of them from becoming to powerful. One week after Bulbov's arrest, Putin paid a visit to the FSB headquarters in what some interpreted as a show of support for the agency. But on Oct. 20 he created a new state committee to fight illegal drugs and named Cherkesov as its chief. The move came a day after Putin publicly scolded Cherkesov on the pages of Kommersant for publicly airing dirty laundry. "It is wrong to take these kind of problems to the media," Putin told Kommersant. "When someone behaves that way and ... claims that a war among security agencies [is going on], he should, first of all, be spotless."

In an attempt to keep the Prosecutor General's Office in check, Putin backed the creation of the Investigative Committee, which took over investigative powers from prosecutors, though formally it works alongside them. Putin then nominated Bastrykin, an associate of his from St. Petersburg, to head the new committee. "When Bastrykin was appointed as the 'main inquisitor,' Chaika was really upset," said Vladimir Pribylovsky, the head of the Panorama think tank. Chaika, a Cherkesov ally, was appointed to replace Prosecutor General Vladimir Ustinov in June 2006. Ustinov is close to Patrushev, and his son is married to Sechin's daughter. Media reports said last year that Cherkesov backed Chaika's appointment, while Patrushev was irked. "All these moves are intended to balance these two groups," the third former intelligence agent said. "If one of them takes over, it would spell the end of Putin's authority."

Political analysts concur. "Putin doesn't want any of the sides to win the fight," said Stanislav Belkovsky, head of the National Strategy Institute. "He needs to have a bit of peace and quiet in the last months of his presidency." While Putin keeps the clans on their toes with reshuffles, security services bombard Putin with reports of terrorist attacks and plots to assassinate him, the former agents said. On Oct. 10, Patrushev said the FSB had thwarted terrorist attacks at international summits in Sochi, St. Petersburg and Samara. Patrushev said the FSB prevented 300 attacks last year -- twice the number the agency prevented in 2005. Security services recently warned of a purported plot to assassinate Putin during his trip to Iran on Oct. 16. "The president is not completely convinced, but he thinks: What if they are right?'" the first former security services officer said. "Our political life is full of provocations. This is the only way these people can work. They are not public politicians. They are Chekists. In our corporation, people were used to fight against dissidents, to arrest or kill people."

Security services have another bargaining chip with Putin, the former agents said: money and assistance in case of a political crisis. Security services gather compromising material that can be used to blackmail anyone in the country, including governors, mayors, the opposition and anyone they believe could destabilize the political situation, the agents said. With his article in Kommersant, Cherkesov broke the Chekists' guiding principle, experts said: silence. "There is a rule in the security services that dirty laundry should be washed at home," said Olga Kryshtanovskaya, a sociologist who tracks the political elite. But in the current fight, "normal rules do not apply," the first former security services officer said. "All means and weapons are allowed," he said. Cherkesov's article wasn't his debut in the print media. In December 2004, he wrote an article published in Komsomolskaya Pravda that proclaimed the fundamental role Chekists have played in Russia's rebirth.

Spokespeople for the Federal Drug Control Service, the Investigative Committee and the Prosecutor General's Office declined to comment for this report. Written requests for comment sent last week went unanswered as of Sunday.

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