Saturday, December 15, 2018

deeper into what brought on Putin--massive plundering of Russia, 1990s

8-3-1998   The FBI learned even more from its informants:  Golden ADA was but one of a series of schemes to plunder Mother Russia.  “One group was involved in stealing timber, oil and precious metals,” said one agent.  “Others were involved in gold and diamonds.”  And at the center of it stood Kozlenok.  The value of goods shipped to Golden ADA equaled $178 million.  But taken together the various scams added up to more than $1 billion, Kozlenok later told the FBI.
  Immendorf recalls hearing of plans to import timber from Siberia and to fuel Golden ADA’s gas stations with gasoline from Russian stockpiles.  Nelson Colton, who had melted down $50 million of coins for Bychkov, remembers his surprise that the Russian was uninterested in chatting about gold.  “He talked about us distributing platinum and palladium for them,” says Colton.  For a while palladium was worth more than gold; two-thirds of the West’s supply is Russian.
  Clues to the scope of the scandal were found in the $40 million in wire transfers that investigators traced from Golden ADA to Moscow.  Some $400,000 was headed to a presidential book fund, to finance the printing of Yeltsin’s autobiography, but somehow the cash disappeared along the way, investigators say.
  The next day a team of 50 IRS agents fanned out across Northern California, seizing Golden ADA’s headquarters and other assets.  The IRS hit the company with what officials say is the largest civil lien in their agency’s history: a $63 million bill for unpaid taxes.  As it turned out, the U.S. attorneys may well have been right.  The IRS action managed to grab a huge shipment of gold, jewelry and more than 3,000 diamonds that had just been sent to Switzerland — four-fifths of Golden ADA’s remaining inventory.  At the firm’s San Francisco office IRS agents found dozens of automatic weapons, thousands of ammunition rounds, bulletproof vests and 25 pounds of explosives.  The IRS raids forced Golden ADA into bankruptcy.  The firm left behind a tangle of lawsuits and a list of creditors 20 pages long, ranging from the Russian government to the local parking garage.  Of the original $178 million in treasure the IRS seized $40 million in assets.  Under a deal struck last April Russia will recover about $25 million, the IRS gets $10.5 million, and the rest goes to other creditors….
  Looting Mother Russia Experts say Russia is being plundered through the sale of its natural resources.  In a typical scheme a seller, aided by corrupt officials, sells Russian commodities overseas for high prices than he reports to the government and pockets the difference.  One scholar compared reports of such sales filed with the Russian government with known market prices of the same commodities.
  In early 1995 Russia's gold reserves amounted to 321.9 tons, according to Evgenii Bychkov.  Russian Precious Metals and Gems Committee [Roskomdragmet] chairman.  In an address to the State Duma the first deputy minister of finance of the Russian Federation, Vladimir Petrov, reported that this reserve had dropped to only 115 tons by 1 October 1995.  But the chairman of the State Duma Committee on Security, Viktor Iliukhin, immediately announced that Russia had spent almost all of its gold reserves:  900 tons have been taken out of the country in the last few years.
2-22-1996    MOSCOW — President Boris N. Yeltsin fired Russia's top diamond official Wednesday for alleged links to a shadowy deal that siphoned off millions of dollars in uncut gems through a San Francisco company called Golden ADA.
  Yeltsin's office said the president dismissed Yevgeny Bychkov, head of Russia's Committee on Precious Metals and Stones, for "poor discipline."
  The news reached Bychkov while he was in negotiations with South African diamond giant DeBeers Consolidated Mines Ltd.  DeBeers runs the cartel through which Russia and other major diamond producers market most of their stones. Russia's contract with the cartel has expired and the talks are aimed at reaching a new agreement.
Russia, which exported about $1 billion in rough gem diamonds in 1995, is one of the world's biggest producers of diamonds.  Bychkov's firing was one of a flurry of dismissals by Yeltsin on Wednesday and comes only days after the president promised in a campaign speech to act against official corruption.  He specifically mentioned Bychkov.
  Bychkov already faces charges of exceeding his authority and violating currency regulations in a 1993 deal with Golden ADA.  Russia shipped hundreds of millions of dollars' worth of rough diamonds to the company for cutting but got neither stones nor money in return.  Bychkov has sued Golden ADA, and a California court has frozen the company's assets.
  Bychkov, 61, has denied wrongdoing and said that if convicted, he is entitled to a special amnesty for participants in World War II.   Yeltsin's decree allows Bychkov, who is a year past the official retirement age, to draw a pension.  But it also accuses him of "poor personal discipline in executing the president's and government's orders."
  It was not clear what effect the decree would have on Bychkov's role in DeBeers negotiations.  Bychkov was not available for comment Wednesday, but his secretary said he continued to take part in the talks.
The Plunder of Russia in the 1990s
-An old Russian gold mining town
       Here is a story I wrote for The Wanderer in 2000:
How Clinton & Company & The Bankers Plundered Russia
by Paul Likoudis (May 4, 2000)
     If America were a free and democratic country with a free press and independent publishing houses (and assuming, of course, that Americans were a literate people), Anne Williamson’s (unpublished) book would topple the Clinton regime, the World Bank, the International Monetary Fund and the rest of the criminal cabal that inhabits the world of modern corporate statism faster than you could say “Jonathan Hay.”
  Hay--for those who need an introduction to the international financial buccaneers who control our lives--was the general director of the Harvard Institute of International Development (HIID) in Moscow (1992-1997), who facilitated the crippling of the Russian economy and the plundering of its industrial and manufacturing infrastructure with a strategy concocted by Larry Summers, Andre Schliefer (HIID’s Cambridge-based manager), Jeffrey Sachs and his Swedish sidekick Anders Aslund, and a host of private players from banks and investment houses in Boston and New York — a plan approved and assisted by the U.S. Department of the Treasury.   Contagion can be read on many different levels.
  At its simplest it is a breezy, slightly cynical, highly entertaining narrative of Russian history from the last months of Gorbachev’s rule to April 2000 — a period which saw Russia transformed from a decaying socialist economy (which despite its shortcomings, provided a modest standard of living to its citizens) to a “managed economy” where home-grown gangsters and socialist theoreticians from the West, like Hay and his fellow Harvardian Jeffrey Sachs, delivered 2,500% inflation and indescribable poverty and transferred the ownership of Russian industry to Western financiers.
  Williamson was an eyewitness who lived on and off in Russia for more than ten years, where she reported on all things Russian for New York TimesWall Street Journal and a host of other equally reputable publications.  She knew and interviewed just about everybody involved in this gargantuan plundering scheme:  Russian politicians and businessmen, the new “gangster” capitalists and their American sponsors from the IMF, the World Bank, USAID,
Credit Suisse First Boston, the CIA, the KGB — all in all, hundreds of sources who spoke candidly, often ruthlessly, of their parts in this terrible human drama.
  Her account is filled with quotations from interviews with top aides of Yeltsin and Clinton, all down through the ranks of the two hierarchical societies to the proliferating mass of Russian destitute, pornographers, pimps, drug dealers and prostitutes.  Some of the principal characters, of course, refused to talk to Williamson, such as Bill Clinton’s longtime friend from Oxford, Strobe Talbott, now a deputy secretary of state and, Williamson suspects, a onetime KGB operative whose claim to fame is a deceitful translation of the Khrushchev Memoirs.  (A KGB colonel refused to confirm or deny to Williamson that Clinton and Talbott visited North Vietnam together in 1971 — though he did confirm their contacts with the KGB for their protests
against the U.S. war in Vietnam in Moscow.  See especially footnote 1, page 210.)
  The 546-page book (the best part of which is the footnotes) gives a nearly day-by-day report on what happened to Russia; left unstated but implied on every page is the assumption that those in the United States who think what
happened in Russia “can’t happen here” better realize it can happen here.
  Once the Clinton regime and its lapdogs in the media defined Russian thug Boris Yeltsin as a “democrat,” the wholesale looting of Russia began.  According to the socialist theoreticians at Harvard Russia needed to be
brought into the New World Order in a hurry; and what better way to do it than Sachs’ “shock therapy” — a plan that empowered the degenerate, third-generation descendants of the original Bolsheviks by assigning them the deeds of Russia’s mightiest state-owned industries — including the giant gas, oil, electrical and telecommunications industries, the world’s largest paper, iron and steel factories, the world’s richest gold, silver, diamond and platinum mines, automobile and airplane factories, etc. — who in turn sold some of their shares of the properties to Westerners for a song and pocketed the cash, while retaining control of the companies.
  These third-generation Bolsheviks — led by former Pravda hack Yegor Gaidar, grandson of a Bolshevik who achieved prominence as the teenage mass murderer of White Army officers, now heads the Moscow-based Institute for Economies in Transition — became instant millionaires (or billionaires) and left the Russian workers virtual slaves of them and their new foreign investors.
  When Russian members of the Supreme Soviet openly criticized the looting of the national patrimony by these new gangsters early in the U.S.-driven “reform” program, in 1993, before all Soviet institutions were destroyed, Yeltsin bombed Parliament.
  Ironically when Harvard’s Sachs and Hay started identifying Russians they could work with, they ignored or shunned the most capable talent at hand:  those numerous Russian economists who for 20 years had been studying the Swiss economist Wilhelm von Roepke and his disciple, Ludwig Erhard, father of Germany’s “economic miracle” in anticipation of the day when Communism would collapse. Somewhat sardonically, Williamson notes that one probably unintended benefit of Gorbachev’s perestroika was the recruitment of these Russian economists by top U.S. universities.
 In the new emerging global economy it’s clear that Russia is the designated center for heavy manufacturing — just as Asia is for clothing and computers — with its nearly unlimited supply of hydroelectric power, iron and
steel, timber, gold and other precious metals.  
This helps explain why America’s political elites don’t give a fig about the closing down of American industries and mines.  As Williamson observes, Russia is viewed as some kind of “closet.”
  What is important for Western readers to understand--as Williamson reports--is that when Western banks and corporations bought these companies at bargain basement prices they bought more than just industrial equipment.  In the Soviet model every unit of industrial production included workers’ housing, churches, opera houses, schools, hospitals, supermarkets, etc., and the whole kit-and caboodle was included in the selling price.  By buying large
shares of these companies Western corporations became, ipso facto, town managers.
  On another level Contagion is about the workings of international finance, the consolidation of capital into fewer and fewer hands, and the ruthless, death-dealing policies it inflicts on target countries through currency manipulation, inflation, depression, taxation and war — with emphasis on
Russia but with attention also given to Mexico, Thailand, Indonesia, the Balkans and other countries and how it uses its control over money to produce social chaos.
  Those who read Williamson’s book will find particularly interesting her treatment of the Federal Reserve, and how this “bank” was designed to plunder the wealth of America through war, debt, and taxation in order to maintain
what is nothing more nor less than a giant pyramid scheme that depends on domination of the Earth and its resources.
  Contagion also serves up a severe indictment of the World Bank, the International Monetary Fund and the other international “lending” agencies spawned by the Council on Foreign Relations and similar “councils” and “commissions” which are fronts for the big banks run by the Houses of Rockefeller, Morgan, Warburg, et al.
  The policies inflicted on Russia by the banks were cruel to the nth degree; but the policy implementers — Williamson employs the derogatory Russian word myakigolovy (“soft-headed ones”) applied to the Americans — were a foppish
lot, streaming into Russia by the thousands (the IMF, alone, with 150 staffers) with their outrageous salaries and per diem allowances, renting out the finest dachas, bringing in their exotic consumer goods, driving up prices for goods and rents, spurring a boom in the drug and prostitution businesses, and then watching cold-heartedly the declining fortunes of their hosts as they lost everything — including the artistic heritage of the country....
  Gore, who was raised to be President, has impeccable Russian connections.  His father of course was Lenin- financier Armand Hammer’s pocket senator, and it was Hammer who paid for Al Jr.’s expensive St. Alban’s Prep schooling; and, as Williamson reports, Al Jr.’s daughter married Andrew Schiff, grandson of Jacob, who as a member of Kuhn, Loeb & Co. underwrote anti-czarist
political agitation for two decades before Lenin’s coup and congratulated Lenin upon his successful revolution.
  Williamson also documents Gore’s intimate involvement with powerful Wall Street financial houses and his New York breakfast meeting with multibillionaire George Soros (a key Russian player) just as the Russian collapse was underway.  Williamson tells an interesting story of Gore’s response to the IMF/World Bank/USAID plunder of U.S. taxpayers for the purpose of hobbling Russia.
  By March 1999, Russia was now a financial basket case, and billions, if not tens of billions of U.S. taxpayer-backed loans had vanished into the secret bank accounts of both Russian and American gangster capitalists, and the news
was starting to make little vibrations on Capitol Hill....
 An equally sanctimonious Albert Gore — the same Al Gore who’d been so quick to return the CIA’s 1995 report detailing Viktor Chernomyrdin’s and Anatoly Chubais’ personal corruption with the single word ‘Bullshit’ scrawled across it — took the low road and sniffed that the
Russians would just have to get their own economic house in order and cut their own deal with the IMF. . . .”
  The cost to the American taxpayers of Clinton regime bailouts in a three-and-a-half-year period, Williamson notes, is more than $180 billion!  The “new financial architecture” Clinton has erected, she writes, “isn’t new
at all, but rather something the international public lenders have been wanting for decades, i.e., an automatic bailout for their own bad practices.”
... to quote Williamson at length:  “If the FBI, [Manhattan District Attorney] Robert Morgenthau, or Congress were serious about getting to the bottom of the plundering of Russia’s assets and U.S. taxpayers’ resources, they would show far more professional interest in exactly what was said and agreed in the private meetings [U.S. Treasury secretary] Larry Summers, Strobe Talbott, and [former Treasury Secretary] Robert Rubin conducted with Anatoly Chubais [former Russian finance minister, who oversaw the distribution and sale of Russian industries], and Sergie Vasiliev [Yeltsin’s principal legal adviser, and a member of the Chubais clan], and later Chubais again in June and July of 1998....
  “The FBI and Congress ought to be very interested in establishing for taxpayers the truth of any alleged ‘national security’ issues that justified allowing the Harvard Institute of International Development to privatize U.S. bilateral assistance.  It too should be their brief to discover the
relationship between the [Swedish wheeler-dealer and crony of Sachs, Anders] Aslund/Carnegie crowd and Treasury and exactly what influence that relationship may have had on the awarding of additional grants to Harvard
without competition.  On what basis did Team Clinton direct their financial donor, American International Group’s (AIG) Maurice Greenberg (a man nearly as ubiquitous as any Russian oligarch in sweetheart public-funding deals), to
Brunswick Brokerage when sniffing out a $300 million OPIC guarantee for a Russian investment fund. . . . And why did Michel Camdessus [who left the presidency of the IMF earlier this year] announce his sudden retirement so
soon after Moscow newspapers reported that a $200,000 payment was made to him from a secret Kremlin bank account? . . .
  “American and Russian citizens can never be allowed to learn what really happened to the billions lent to Yeltsin’s government; it would expose the unsavory and self-interested side of our political, financial and media elites. 
  You see as this book explains, the Clinton’s Russia policy did not just plunder Russians, leaving them destitute while creating a new and ruthless class of international capitalist gangsters at U.S. taxpayer expense; it had the double consequence of bringing all Americans deeper into the bankers’ New World Order by increasing their debt load, decreasing their privacy and restricting their civil rights.
If only Americans cared.
at page 451 of
10-18-1999     Many of the firms that engaged in massive capital flight in the 1990s were actually born in the 1980s during the orgy of money laundering that brought about the collapse of the Soviet Union.  Soviet enterprises were expert at hiding financial flows from prying eyes, since this talent was essential for fulfilling the unrealistic plan targets that defined Soviet managerial objectives....

Starting in 1987, however, certain organizations were granted special permission to turn non-cash credits into cash.  Among these groups were business cooperatives created under the auspices of the Komsomol, the Young Communist League of the Soviet Union. They were given the right to use some of the Komsomol's vast financial resources to hire young engineers and inventors under a sort of Soviet Junior Achievement program known by the acronym NTTM.

The NTTM program created a loophole that led to the creation of a number of so-called ''Komsomol banks.''  These banks were able to turn tightly controlled Komsomol budget funds into easily circulated rubles.  Later in the 1980s, as these firms grew in sophistication, they were able to contract with other enterprises that lacked their financial flexibility and turned those enterprises' budgetary assets into cash as well.  In short, NTTMs practiced money laundering Soviet style, taking state bank accounts and turning them into private cash.

Later in the 1980s...Communist Party, KGB, trade union and other organizations all exploited similar loopholes to move Soviet government assets out of Soviet government accounts.  These activities were no more legitimate in the Soviet context than later asset-stripping in the Yeltsin years.

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