BRIDGE NEWS
RUSSIA LAUNDERING
Ex-Inkombank attorney now heads bank agency
By Heather MacGregorBridge News. New York Oct 1, 1999 The head of the legal department of the now-defunct Inkombank--a bank proclaimed as being fraudulent by the Central Bank of Russia is now heading Russia's Agency on Restructuring of Credit Organizations (ARCO). Alexander Turbanov led Inkombank's legal department in 1993 before being appointed Central Bank deputy chairman, according to Inkombank's telephone directory at the time and those who knew him. The Central Bank of Russia revoked Inkombank's license in October 1998 for violating several laws and the rules of the Central Bank.
The circumstances of Turbanov's appointment to the ARCO post are unclear. A person who answered the telephone at ARCO in Moscow said Turbanov was unavailable for comment. The goal of ARCO, which is controlled by the Russian government and the Central Bank, is to restructure domestic banks. The main direction of ARCO's activity would be buying controlling stakes of ailing banks, restructuring such banks from inside and then reselling the stakes. "Our main goal will be to restore the banks' credibility," Turbanov told a group of reporters at a ARCO news conference in March.
However, some people consider Turbanov's appointment equivalent "to the fox in the hen house." "They appointed the same guy who was part of Inkombank's corrupt structure," said Emanuel Zeltser of the American Russian Law Institute, referring to the scandal involving alleged corrupt Russian banks. "Now he will be the recipient of future IMF funds...It doesn't promote anti-corruption anywhere."
IMF spokesman William Murray said there are no IMF funds going to ARCO. In response, Zeltser said he hopes that is true. The IMF did not comment on Turbanov's former position with Inkombank. spokeswoman for the World Bank Group, which works with the Russian government on bank-restructuring projects, declined comment. End.
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