London Trial Provides Rare Peek Into Russian Wealth And Power

It’s being called historic. Inside a London courtroom, two of Russia’s most famous and — at various times — powerful oligarchs are facing off in a case that’s providing a fascinating view into how that country’s Soviet spoils were snapped up by a handful of super-rich men.

On one side of the courtroom is billionaire Boris Berezovsky, the outspoken former “gray cardinal” of former President Boris Yeltsin’s Kremlin. He helped pick Yeltsin’s successor, Vladimir Putin, before spectacularly falling out with the new leader and leaving for exile in Britain, where he remains one of Putin’s most voluble critics.

On the other is Roman Abramovich, Berezovsky’s former protégé and owner of the Chelsea Football Club, whose fortune under Putin has soared to an estimated $17 billion. Berezovsky is suing him for $5.8 billion, saying Abramovich bilked him of his share of the Sibneft oil company, ORT television (now Channel One), and other businesses by bullying him into selling his stakes. Abramovich admits he paid Berezovsky billions for his political connections and says he owes him nothing.

The case is fascinating observers for also providing a view into how Putin remade Russia into an authoritarian state, overseeing the state’s appropriation of formerly private media, oil, and other industries as he consolidated his power.

‘A Lot Of Anger’

On November 14, the court heard evidence from Aleksandr Voloshin, Putin’s former chief of staff, who testified that Berezovsky was trying to make political capital from the sinking of the “Kursk” nuclear submarine in 2000 by leaning on journalists at ORT to criticize the Kremlin’s handling of the disaster.

Duncan Gardham, who is covering the trial for the “Daily Telegraph,” told RFE/RL’s Russian Service that Voloshin’s evidence concerned a “really crucial aspect of the court case.”

“His version is that Mr. Berezovsky was on the phone all the time and always pestering the journalists and telling them what to say, and that once the government took over the station effectively that they were free from that,” Gardham said.

Voloshin, who remains close to the Kremlin, told the court that during a meeting in August 2000, Putin told Berezovsky the “show is over.” Gardham said Berezovsky’s argument is that by subsequently pressuring him to sell his shares in ORT, Abramovich was “acting as Putin’s messenger.”

“That, in a sense, is the element of the breakdown of that relationship, which is a kind of key to it,” Gardham said. “There clearly is quite a lot of anger on both sides.”

History Lesson

The testimony, as well as hundreds of pages of court papers, are exposing a high-stakes world of unwritten agreements over vast fortunes, extortion, and extravagant lifestyles in which millions of dollars are thrown around like petty change.

Abramovich admits that after the two men met on a private yacht in 1994, they agreed that Berezovsky would use his close Kremlin connections to persuade the government to privatize oil fields that Abramovich would buy in a shady closed auction.

In return for Berezovsky’s political protection — or “krysha,” literally “roof” in Russian — Abramovich says he financed Berezovsky’s luxurious lifestyle, chartering planes, booking five-star Riviera hotels, and buying resort houses to the tune of many hundreds of millions. He denies Berezovsky ever had a stake in what become the Sibneft oil company.

But Berezovsky insists his deal with Abramovich gave him a stake he sold for $1.3 billion three years before Abramovich handed the company to the government for $11.9 billion.

Public Spectacle

Emotions are flying high in the courtroom, where each man refuses to meet the other’s gaze. The trial has made front-page news in Britain, which has been flooded with wealthy Russians whom Berezovsky and Abramovich symbolize. Michael Binyon, foreign correspondent for the London “Times,” told RFE/RL’s Russian Service that although Abramovich is well-known in England, few know anything about the Chelsea Football Club owner’s private life.

“The trial is the first chance many people have had to hear any details of how he made his money, and how much money he has and all that sort of thing,” Binyon said.

Berezovsky is similarly well-known because Britain’s refusal to extradite him to Russia is among the key reasons behind bad relations between the two countries. But Binyon said people are also interested in what the trial says about Russia.

“There is the spectacle of two of the richest men in Britain having a fight with each other over money,” Binyon said, “and there’s a hope the trial will expose some of the corruption and some of the shady dealings that went on in those wild days after the end of communism.”

Binyon said some of the case’s details sound “more like a gangster film” than ordinary business dealings. He said most British sympathize with Abramovich because it appears Berezovsky, after having lost much of his influence, is “trying to blackmail Abramovich into handing over more money.”

Back in Russia, whatever the trial’s outcome, it’s already seen as the country’s version of the WikiLeaks scandal for the light it’s shed on the connections between business and politics.

Leave a comment