International, Russia - Written by on Friday, December 7, 2012 6:42 - 0 Comments

The view from Moscow: ‘average’ price of a Russian bribe, when a facilitation payment isn’t & more

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We’ve been in Moscow the last couple of days and we have been struck by the number of news items about corruption in the Russian media. Yesterday, the Moscow Times reported, along with everyone else, the publication of the new Transparency International Corruption Perception Index.

For those of you who have been living under a rock Russia now ranked at 133 out of 174 countries ten spots ahead of last year when Russia ranked 143.

The wrinkle (there is always a wrinkle) that there were 9 more companies in the survey last year!  Put another way Russia has not moved.

A statistic at the foot of the Transparency International article caught our eye. It was reported that the ‘average’ price of a Russian bribe is about 60,000 rubles ($2,000) following a statement from the Interior Ministry’s anti-corruption department head, Alexei Ryabtsev, in an interview published Wednesday.

Perhaps in response to the slew of articles and the Transparency International index Prosecutor General Yury Chaika was today quoted as saying:

“Fighting corruption is one of the main priorities of state policy at the present time…Our country has worked out a national plan for counteracting corruption…”

Other stories include the opening of a criminal case into a defence contractor, which has garnered some headlines in the West with the Minister of Defence getting sacked over the scandal by Vladimir Putin to “create the conditions for an objective investigation”.

However, our favourite story of all related to Russia Customs authority which includes a lesson for the unwary.

The Federal Customs Service was reported to have said that it has opened more than 100 criminal cases related to bribery and other corruption since its anti-corruption division opened in August 2011.

Of 133 corruption cases, 110 were against customs employees and 23 against people offering bribes.

But as a salutary warning to businesses Alexander Smelyakov, head of the Federal Customs Service press department, said most bribes don’t actually speed up the movement of goods through the border but instead broadly result in not enough duty being paid.  Put another way they are not facilitation payments at all but in your face, out and out, bribes – pure and simple.

Demonstrating that whistleblowing is alive and growing in Russia (a place where historically whistleblowing has been frowned upon) it was reported that investigations are assisted by complaints from ordinary people with about 180 complaints of corruption in Q3.

Smelyakov  also spoke of an October meeting when Medvedev said the business community must wage its own battle in the anti-corruption war against customs corruption.

The lesson for business: Steps are being taken to stamp out corruption in Russia, whistleblowing though nascent is growing, and and businesses need to understand exactly what is happening with the shipment of goods and their logistics operators.

Finally, the Russian paper Vedemosti reports that Anatoly Kruglov, who once headed the State Customs Committee from 1992 to 1998, is seeking the return of $37.5 million investments from property tycoon magnate Shalva Chigirinsky in the London courts.

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