Russia’s Top Financial Execustive is Making Friendly Investments

Russia’s Top Financial Execustive is Making Friendly Investments


VEB.RF state development corporation invests money in joint projects involving Russia’s richest people. Meanwhile, the top executives of the corporation receive multimillion-dollar revenues.

Last week, the Gulfstream G650 business jet with the LX-MOW tail number took off from Vnukovo airport in Moscow and landed in Tel-Aviv. This jet is associated with the family of Igor Shuvalov, the president of VEB.RF and former Deputy Prime Minister. Israel is not the only country where this jet was spotted during the COVID-19 pandemic when air traffic was officially stopped.

In May 2020, the Gulfstream G650 landed in Salzburg, says MBK media. The Austrian authorities then reported that they allowed the plane to land in spite of the ban on air traffic with Russia, because there were no passengers on board. The plane was flying in order to “pick up suitcases and other belongings of residents who are homeowners in Austria.” As is known, the Shuvalovs have a castle with an area of 1,480 m² near Lake Attersee in the Alps.

Out of Sight

In Russia, Shuvalov and his family live in a mansion in Skolkovo. Its area exceeds 4,000 m². Through the Zarechye-4 company, the 7.6 ha plot is owned by Sova Nedvizhimost, which belongs to the Shuvalov family.

Alexei Navalny, the leader of Russia’s non-parliament opposition, mentioned in an investigation that the neighboring elite residential complex Skolkovo was designed so that the view of the Shuvalov’s mansion was blocked for the residents of the complex. Navalny found a video on the Internet in which Vladimir Plotkin, the architect of the complex, explained this decision by the fact that there is “a government residence” on the southern side, looking at which is not allowed.

Shuvalov's Palace, That is Forbidden to Look at

Better Than Government

One flight for belongings could cost Shuvalov 35,000 euros (2.7 mln rubles.) Shuvalov can afford the trip of this kind even with his legal income. As the Sobesednik newspaper found out, in 2019, he officially earned 179,705,000 rubles ($2,566,187.40.) In 2017, when Shuvalov worked as a state official, his income, according to the tax declaration, was almost 2 times less and equal to 91.3 mln rubles ($1,3 mln.)

The business jet that transported Shuvalov's belongings from Austria

It became clear why Shuvalov himself asked to be dismissed from a position in the government. The VEB.RF state corporation brings bigger income than an official’s salary. And not just to Shuvalov. The annual earnings of VEB.RF’s board members are also impressive. Data for the last year is not yet available. Moreover, in 2018, Nikolai Tsekhomsky, the VEB.RF first vice president, earned 235.6 mln rubles ($3,4 mln.) As established by Sobesednik, he lived in a penthouse in the Sokolinoye Gnezdo residential complex in Moscow. Its cost is estimated at about 50 mln rubles ($714,000.) Additionally, he owns an apartment worth 300 mln rubles ($4,284,000) in the popular Crystal House Club House in the immediate vicinity of Igor Sechin, who is also the head of the Russian oil industry major Rosneft.

Nikolai Tsekhomsky

Yuri Gazaryan, the VEB.RF board member, has a modest annual income equal to 34 mln rubles ($485,520.) Interestingly, Gazaryan started working for Shuvalov’s VEB.RF after resigning from the White House, the headquarters of the government of Russia. He worked there in the administrative office of Dmitry Medvedev. In accordance with tradition, other former government employees, including Natalia Timakova, who used to be Dmitri Medvedev’s press secretary, also followed their boss and left public service for VEB.RF.

Shuvalov himself had worked in civil service for over 20 years. In addition to the palace in Austria, it also helped him buy an apartment in London worth about 1 bln rubles ($14,3 mln.) Previously, Sobesednik made a catalogue of elite real estate associated with Shuvalov's family. The total sum turned out to be more than 17 bln rubles ($242,8 mln.)

Millionaire and Manager

The family assets of Shuvalov, who is prohibited from running business, are managed by Sergey Kotlyarenko. He himself owns the Sitimatik and Blagoustroystvo-1 companies, which earned almost 270 mln rubles ($3,9 mln) on contracts for garbage removal with the authorities of the Smolensk region.

Car Double Game

Last year, according to Shuvalov’s income and property information, he got rid of one non-residential premise, but bought two parking places. His minor child got a new Mercedes-Benz GLE 350d 4MATIC worth 8 mln rubles ($114,240.) Anastasia, Shuvalov’s daughter, turned 18 only this January.

His other children also own elite cars. Sobesednik weekly found out that Yevgeny, Shuvalov's 27-year-old son, has a Mercedes AMG G 63 and two Harley-Davidson bikes. Maria, his 22-year-old daughter, prefers BMW bikes and has a Lincoln Mark automobile.

VEB.RU are generally knowledgeable about cars, too. As it can be seen from the insurance contracts, studied by the Sobesednik newspaper, the car fleet of this state corporation consists exceptionally of numerous Audi A8, Audi A6, Mercedes-Benz S-class, Nissan Teana and Toyota Land Cruiser. At the same time, VEB.RU provides financial support to the domestic car manufacturer. It invested 60 bln rubles ($856.8 mln) in the production of LADA Vesta. “LADA Vesta is a model of a new generation. It was created in the concept of X-DNA-design, which is the corporate identity of the brand today.

“LADA Vesta outstands with a spacious interior, comfort, exciting control performance and top-tier equipment,” the official website of VEB.RU reported proudly. “The quality of the car was appreciated both by buyers and experts in the automotive business.”

However, apparently, top executives of the state corporation themselves have not praised the advantages of the domestic automotive industry despite 60 bln rubles spent from the budget.

For Record

In the spring of 2020, VEB.RU filed a lawsuit against Valery Fadeyev, the chair of the Human Rights Council, in the Arbitration Court of the Sverdlovsk region. The corporation demands that the Expert media holding belonging to Fadeyev be declared bankrupt.

Support to Needy Oligarchs

“Promoting long-term economic development of Russia” is the key task of VEB.RU. The state corporation finances projects aimed at “developing infrastructure, industry and social sector, strengthening technological potential and improving the quality of people’s life.”

Sobesednik studied the projects supported by VEB.RU. Many of its beneficiaries turned out to be associated with major businessmen who have powerful acquaintances.

Together with the billionaire businessman Arkady Rotenberg VEB.RU established Natsprojectstroy. In May, the media reported that the company might receive 120 bln rubles ($1.71 mln) for the construction of the Far Western Detour of Krasnodar and Aksai Detour of the Rostov region from the federal government without any contest.

Arkady Rotenberg, the hero of the Crimea Bridge and friend of Vladimir Putin

Arkady Rotenberg and Vladimir Putin // Photo by Global Look Press

As Sobesednik found out, Natsrojectstroy has recently established subsidiary firms, apparently, for working on these projects. On June 17, NPS DZOK, NPS EZK and NPS Aksai were registered. Rothenberg's Transstroymekhanizatsiya directly controls 1% in joint companies, which has already spent 239 bln rubles ($3,4 bln) from the state contacts. In Russian, DZOK stands for Far Western Detour of Krasnodar and EZK for Europe – Western China.

The VEB.RU state corporation provides loans with the limit up to 111 bln rubles ($1,6 bln) for the project on building a gas chemical complex in the area of the Ust-Luga sea port in the Leningrad region. The complex is being built by Gazprom together with RusGazDobycha owned by Artem Obolensky, former partner of Arkady Rotenberg.

VEB.RU made a decision to support Alexander Mamut, another well-known businessman. In May, RBC reported with the reference to a source in the state corporation that the corporation had agreed to buy about 20% from STRELKA KB owned by Mamut. VEB.RU is going to support a number of investment projects and to help the company expand in the regions.

Alexander Mamut // Photo by AGN Moscow.

Shuvalov’s own success is associated with Mamut. Thanks to the work in ALM Consulting, Mamut’s firm, Shuvalov has earned his first millions and useful acquaintances. Shuvalov was instructed to transport cash and to sell offshore companies.

The son of Igor Chaika, former Prosecutor General, was another strategic partner of VEB.RU. Chaika the youngest owns 51% of Engineering.RF, while the remaining 49% belongs to the VEB.RU state corporation. The plans suggest, among other things, that Engineering.RF will be building informational model.

Igor Chaika // A screenshot from YouTube

In cooperation with Rockwell Capital owned by Gleb Frank VEB.RU decided to set up a holding company for projects in the timber industry. The construction of a timber chemical plant in the Krasnoyarsk territory became its first joint venture. The total investment is estimated at 140 bln rubles ($2 bln.) It is planned that the plant will carry out export deliveries to China.

Gleb Frank, the son-in-law of billionaire Gennady Timchenko and son Sergey Frank, is a member of Shuvalov’s entourage. Previously, he served as the Minister of Transport, and nowadays he is chairman of the board at Sovkomflot.

VEB.RU is also associated with Vladimir Potanin, the richest businessman in Russia. Together with Zavidovo Development, VEB.RU owns the Zavidovo Plaza company, the Radisson Zavidovo hotel complex in the Tver region. Zavidovo Development is controlled by Sergey Bachin, a top excusive for Potanin's Interros.

According to the public procurements website, state banks and Moscow's multifunctional centers providing public services use the services of Radisson Zavidovo on a regular basis. Due to the state contracts, the company has earned more than 20 mln rubles ($285,600.)


The plans for 2024

In four years, VEB.RU is going to reach the following targets:

1) Loans for priority projects of the Russian economy will amount to 3 trln rubles ($42,8 bln);

2), Contribution to Russian economy will stand at 8 trln to 9 trln rubles ($128,5 bln) with account of attracted co-financing from other financial organizations

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The article was published in the Sobesednik newspaper No. 23-2020 under the title “Friendly Investments.”

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