• In April 2004 a Special Commission for the Struggle against Corruption was founded by the new parliament, elected in December 2003. Its tasks consist of analysing laws and draft bills to detect flaws that might provide opportunities for corruption. It also serves as an agency to take citizens’ complaints, receiving roughly 100 in its first two and a half months of existence. • In March 2004 the Federal Financial Monitoring Service (FFMS) was reorganised. This ‘finance intelligence’ service monitors all property contracts and transactions exceeding a value of 3 million rubles (US $100,000). When organisations carry out such transactions, they are obliged to inform the FFMS immediately. Obligations to inform the FFMS also apply for certain cash operations, transactions with accounts held anonymously, operations by legal entities registered within the past three months, financial leasing operations, and also interest-free loans that exceed 600,000 rubles (US $20,000).
Putin’s anti-corruption policy Curbing corruption has become one of the catchwords for legitimising Vladimir Putin’s ‘strong presidency’ and rebuilding the so-called ‘power vertical’ – Putin’s main project to modernise and strengthen the Russian state. In line with this project, the struggle against corruption is characterised by top-down, campaign-style measures, and the creation of new agencies. As the anti-corruption campaign has built up momentum in Russia, however, it has also become evident that, as in some other countries in the Commonwealth of Independent States (for example, Ukraine and Belarus), the struggle against corruption is becoming a powerful tool in the hands of the president who may turn it selectively against unhelpful officials or political opponents. The ‘Yukos affair’ is a case in point. In October 2003 Mikhail Khodorkovsky, chief executive of the Russian oil giant Yukos, regarded as the richest man in Russia, and a major financier of the reformist Yabloko Party, was arrested on charges of fraud, forgery, embezzlement and tax evasion. Many observers believe the affair was triggered not only by Khodorkovsky’s rising political ambitions, but also by an incident during a meeting between Putin and the so-called oligarchs in early 2003, when Khodorkovsky supposedly criticised the pervasiveness of corruption in the executive.
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As early as April 2002 Putin had criticised the state administration as being badly run and corrupt, and called for institutional reforms in his annual state of the nation address, since then no measures were taken. Two days after Khodorkovsky’s arrest, however, Putin declared corruption a threat to national security and called for a ‘systemic anti-corruption policy’. In November 2003 he instigated the Presidential Council for the Struggle against Corruption, which consists of two commissions – one to fight corruption, and the other to uncover conflicts of interest which may arise when government officials accept gifts from, or spend vacations with, company executives. The formation of a presidential council is a long-established method within Russia of dealing with difficult issues. The council is directly subordinate to Putin and is limited to an advisory role. Its design is interpreted by many analysts as signalling a victory for liberals over hard-liners within the Kremlin who had stipulated the establishment of a special agency commanding an armed force, either independent or as part of the interior ministry. While the latter approach would have been unnecessarily heavy handed (and particularly opposed by Russia’s business elite),1 critics of the winning, ‘soft’ solution question the council’s effectiveness in the absence of law enforcement. In any case, at the time of writing the council has been inactive.2
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