12-9-19
For years the banking sector was a gold mine for the security
services, combining huge, often-illicit flows of cash with plenty of
leeway for officials to either turn the screws or look the other way.
The numbers are big even by oil-rich Russian standards.
Regulators—including the central bank—say managers stole some
7 trillion rubles ($110 billion) in assets from their banks in the past
decade, and the central bank has spent more than 5 trillion rubles
on bailouts or to pay off depositors at those that didn’t survive,
according to Fitch Ratings....
Failing banks could be kept afloat to continue illicit operations.
Some saw their good assets stripped out and replaced with junk
before regulators closed in. Once a bank failed, corrupt officials
could rig the cleanup process to divert any remaining valuables to
their allies at knockdown prices. “The bank purge has given this
army of corrupt officials a new tool: taking banks apart,” says
Alexander Sharkevich, a former senior official at the Interior
Ministry responsible for financial crimes. “It’s created a massive
feeding trough.” https://www.bloomberg.com/news/articles/2019-12-10/russia-s-fsb-has-distorted-markets-and-sapped-investment
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