The Case Against Baturina

161704314.jpgYelena Baturina is in trouble. The halcyon days of bulldozing through Moscow, overseeing Inteko’s lucrative development contracts, apparently eased along by her husband, then mayor Yury Luzkhov, are over: they ended with his fall from grace.  Baturina has plummeted in the rankings of the rich, is now the object of a criminal investigation over $440 million of allegedly embezzled money, and has fallen victim to the familiar saga of office raids by armed police officers.  Sergei Matyunin in the Moscow Times argues the case that Baturina, who in tandem with her husband, were seen by some as unashamedly profiteering from of an unjust use of power, may, in fact, be being victimized.  He explains why:

What we have had in effect is a taxpayer-subsidized construction industry. Privileged companies take the fruits, do not invest their own money and shift the risks onto the public. This is the real scandal. Neither Baturina’s company nor the bank nor the equity fund has made any substantial contributions into the project. If the project fails, none of them would have serious losses. If it succeeds, they would make away with generous profits.

Prosecutors’ implication that Baturina has orchestrated the swindleis an oversimplification and probably wrong. The infusion of publicmoney into Bank of Moscow was approved by the Moscow government and theCity Duma. Too many people were involved to believe that there was justone person behind the scenes.

The truth that nobody wants to face is that the country’s developmentbusiness may work just like that. Though there are those who certainlybenefit most, the problem is not in a certain person but in the system.

Against this backdrop, it is hardly possible to distinguish between agenuine desire to bring order and fairness into this real estate marketand an attack on those who fell out of favor, the goal of which is totake control of their assets on the cheap.

Read the whole article here.