Wealthiest Russian ex-Minister arrested for embezzling $62 million
Mikhail Abyzov, who served for six years as Minister for Open Government Affairs in former Russian President Dmitry Medvedev’s cabinet, was arrested by the Russian Federal Security Service (FSB) on Tuesday.
One of the 200 wealthiest people in Russia and the top-earning civil servant in 2015, Abyzov has now been charged with creating a criminal organization and embezzling 4 billion rubles (around $62 million at current exchange rates).
According to the Russian Investigative Committee, the embezzled funds account for 10% of Abyzov’s net wealth, which Forbes estimates at $600 million.
After the position was abolished in 2018, the former minister moved to Italy, informed sources told the news agency RBC. However, on 25 March he decided to visit Moscow, where he was arrested by local law enforcement.
In the period between April 2011 and November 2014, as the beneficial owner of a number of offshore companies, Abyzov effectively created and ran a criminal organization.
“Acting in association with Nikolai Stepanov, Maxim Rusakov, Galina Fraidenberg, Alexander Pelipasov and Sergei Ilyichev, by defrauding the shareholders of OJSC Siberian Energy Company and OJSC Regional Electric Networks… Abyzov embezzled 4 billion rubles of the said companies’ monetary funds. All the embezzled funds were channeled abroad,” said Investigative Committee spokesperson Svetlana Petrenko.
Abyzov could face up to 20 years in prison for his crimes.
In order to arrest Abyzov, the FSB had to lure him back into Russia, a source familiar with the situation told Interfax. According to the source, the former minister traveled to Russia roughly a week ago “for one of his former colleagues’ birthday”.
26 March was the 47th birthday of Arkady Dvorkovich, co-chairperson of the Skolkovo Foundation, who worked with Abyzov in the presidential administration and government.
Before serving in the government, Abyzov held leadership positions in several fuel and energy companies. He was the deputy chairperson of UES Russia, CEO of UK Kuzbassrazrezugol, and a member of the board of directors of Russian Communal Systems, RU-COM and the E4 Group.
At the start of 2012 he became an aid to then President Dmitry Medvedev. Several months later, when Vladimir Putin and Medvedev traded places, he was appointed Minister for Open Government Affairs.
Kremlin Spokesperson Dmitry Peskov said that President Vladimir Putin was informed in advance about Abyzov’s arrest.
The charges against Abyzov are “monstrous,” said Sergey Ryabukhin, head of the Federation Council’s budget committee. “He is a person who was entrusted in the government with creating favorable conditions for developing business and attracting investments. But, as for the development of small and medium enterprise, despite the significant financial investments from the state, the result remained the same,” he remarked, adding that there had been questions about Abyzov’s activity earlier “because there were no results”.