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Strategies & Market Trends : Scamthony Cataldo -- Ignore unavailable to you. Want to Upgrade?

To: scion who wrote (29)	1/14/2004 4:43:42 PM
From: scion	Read Replies (1) \| Respond to of 137

In another case combining government and business corruption, pocket banks were created to allow entities Kristine Kassekert 40 International Affairs Review below to a single company or industry that needs a special line of credit, or used political banks, born of the embrace between Russian business and government, that has given new meaning to crony capitalism.74 Allegations in the Bank of New York investigation indicate such a transaction contributed to the money filtered through New York: Flamingo and DKB were the children of two other banks, MDM and Sobinbank, which enjoyed the backing of well-connected patrons in Moscow such as Sobinbank.75 Sobinbank had been put together by a collection of larger, powerful Russian banks, including SBS Agro.76 SBS Agro was no stranger to the Moscow elite - its head is Aleksandr Smolensky, who had ties to Boris A. Berezovsky, currently under indictment for embezzling funds during his tenure as director of Aeroflot. This is not simply a case of guilt by association - there is a network of those involved in these types of transactions that crosses between the public and private sectors. With regard to the funds transferred through The Bank of New York, $300,000 has been identified as related to kidnapping or ransom, and rumors still abound that the total sum includes IMF money.77 IMF funds have been routed away from the Russian citizens in documented prior transactions.78 For example, in July 1998 the IMF departed from its usual practice of making funds available to the hard-currency reserves of Russia’s Central Bank, and planned to send $1 billion directly to the Russian Finance Ministry for use in the country’s budget. The IMF refused to give the other $3.8 billion directly. The IMF loan to date is not fully accounted for - Russia’s banks moved billions of dollars abroad after the cash, and IMF funds are thought to be included in the estimated $4.2 billion poured through Benex, a company that specializes in funneling Russian money offshore, that maintained an account in the Bank of New York.79 In 1998 the IMF gave its largest amount through the tranche, $10.2 billion, just before Yeltin’s reelection. 80 Marshall Goldman, describing another occurrence of misused IMF funds, said that in 1993 the head of the Russian Central Bank engaged in hiding IMF loans in one bank, and then in an offshore company in the Seychelles Islands.81