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Kompromat Korner November 17, 2006
Kompromat Korner
By Yasha Levine Browse author Email

Butovo back on the map?

You might remember a brief spat between Moscow Mayor Luzhkov and a score of residents from Moscow's southernmost neighborhood of Butovo last June which pitted peasant-level Moscow residents occupying small ramshackle farm-style houses against Luzhkov's affordable housing project machine. After having been served eviction notices, the fifty or so residents refused to budge from their homes. They had so much resolve that even the OMON, called in by Luzhkov, couldn't force them off their land.

Back then, Luzhkov was clearly peeved. Not only were these people slowing down his construction racket but they were also making him look bad. So he did what any politician would do to smooth things over and get the process going again. He went on prime time national TV and announced that all Butovo residents  and one overly active Butovo family, the Prokofievs, in particular are "a bunch of slobs" that that only care about their own well-being and don't give a rat's ass about all the other Moscow families that didn't have proper housing.

The Prokofievs didn't take the insult sitting down. They responded immediately by filing a slander suit against Luzhkov in a Moscow court. The case was just heard. But it turns out that the family isn't looking for monetary compensation. In their serf-like naivete, the Prokofievs simply want a public apology from Luzhkov, aired on national television, to counteract the nasty words he uttered earlier. They don't even care on what channel, or at what time, it airs.

But even that small wish may be already too much to hope for. reported that during the trial's opening statements, it was revealed that the NTV channel, which aired Luzhkov's comments, wasn't planning to present the evidence to the court. According to an NTV representative present at the hearing, the network routinely destroys old recordings.

For Moscow, EGAYS not enough?

While the Duma is considering nationalizing Russia's alcohol industry, Moscow is going its own route to tap into the fake hysteria surrounding Russia's alcohol "worsening" poisoning epidemic, which hasn't worsened. The city is planning to release a consumer protection system that will quickly and easily determine if a bottle of vodka or other hard alcohol produced in the Moscow region is fit to drink.

Moscow Quality, a government certification body specializing in alcohol quality assurance, is proposing to deploy an SMS messaging system to track alcohol bottles of alcohol with a special unique identifier number would be adhered on a sticker separate from a federal excise stamp. That number would be paired with the bottle's specific info and customers, before buying a bottle of booze, would be able send an SMS message with a bottle's unique ID to make sure the alcohol in question is on the up and up. Seemingly, this is a good thing. Except that there's just one problem, the price.

The service is going to cost anywhere between a quarter to a dollar per SMS. And while this might seem like fairly cheap, it ain't. At least not for people who would actually need to use this service.

Bootleggers rarely aim to counterfeit top or even middle shelf hard liquor varieties. Usually, they aim low and compete with at liquor brands well below the 100-ruble mark. Dishing out 25 rubles to check if a 60 ruble bottle of vodka is legit just doesn't make economic sense. It makes more sense to split another bottle with a buddy...

But whether it works is not the point. Moscow's market has a turnover of about 400 million bottles of hard liquor a year. Some people will surely use the new SMS service, if only for the novelty of it. If only a quarter of all the bottles produced and sold in Moscow get checked, that's already a clean $100 million dollars in profit to be made.

Managers steal half a billion dollars?

Last January, Sovkomflot, Russia's largest shipping company, which is100% government-owned and heavily deals in crude oil transport, filed a suit in Britain's High Court against some of its former managers and partnering companies for embezzling $321 million.

But as the court found out earlier this week, two of Sovkomflot's top managers actually managed to pocket much more than that. According to Vedomosti, Dimitry Nikitin, Sovkomflot's previous general director, and Yuri Prival, a worker at the company's London branch, managed to funnel over $500 million of the company's money by grossly overpaying on a couple of ice tanker deals and pocketing the difference. Half a billion in one year, split two ways? That's not bad at all.

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Yasha Levine is an editor at The eXile. You can contact him at

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The future of The eXile is in your hands! We're holding a fundraiser to save the paper, and your soul. Tune in to Gary Brecher's urgent request for reinforcements and donate as much as you can. If you don't, we'll be overrun and wiped off the face of the earth, forever.

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