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CORRUPTION

2 billion scam: mafia oligarchs and a simple lawyer from Mytishchy became new owners of Russian Railways’ electric trains

It's already difficult to consider Russian Railways as a state-owned company. In recent years, the state corporation RZhD has been actively selling off its most profitable assets. Among them is the Central Suburban Passenger Company (CSPC), which operates electric trains in Moscow and several regions in central Russia. The beneficiaries of the Central Suburban Passenger Company’s privatization were oligarchs Bokarev and Makhmudov, affiliated with the Izmailovo Organized Crime Group. The Insider found out that the auctions are being held using fraudulent schemes: stakes in the state-owned company are being bought cheaply by companies registered to nominees. For example, an ordinary lawyer from Mytishchy near Moscow has turned into an official billionaire, and now she owns shares in major transport companies.

ALL CARDS
  • Fake auction

  • Billionaire from Mytishchy

  • Criminal ties

  • Uzbek connection

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Central Suburban Passenger Company is the largest suburban rail carrier in Russia. Every day it transports 1.6 million passengers in Moscow and the Moscow, Ryazan, Kaluga, Vladimir and other regions. Now CSPC JSC is a privately owned company, although until recently it was a branch of Russian Railways. The state was gradually stripped of its ownership rights and lost billions of rubles through corrupt schemes.

Fake auction

Russian Railways owned a 50% stake in CSPC until 2013, when it sold 25% to Moscow Passenger Company (MPC) owned by Fredlake Holdings Ltd, a Cypriot company linked to Iskandar Makhmudov and Andrei Bokarev. But the privatization did not stop there: in 2017, it was announced that another 25% stake would be sold. The state company planned to get at least 4.2 billion rubles for its share, but it sold for nearly 2 billion less. The winner of the auction was a mysterious Routing Systems LLC, registered only a month before the auction. The Insider found out that Bokarev and Makhmudov, who had registered the firm to their nominees, were behind the deal.

The co-founder of Routing Systems was a certain Anna Boeva, who soon became the only formal owner of the company. As established by The Insider, this woman worked for MPC as a lawyer before purchasing Russian Railways’ expensive asset. Moreover, she continued to be listed in this firm even after becoming the official co-owner of a large business. She received a salary (about 150,000 rubles a month), lived in a 41-meter apartment on Mira Street in Mytishchi near Moscow, and took out small consumer loans. All the while ostensibly owning her own business worth billions.

The clue to the mysterious winner of the auction lay in the owner of MPC, the company for which Boeva works: Bokarev’s and Makhmudov's Fredlake Holdings. Moreover, MPC itself directly participated in the bid for the right to buy shares in the CSPC. It turns out that the oligarchs «competed» with themselves by knocking down the price of the Russian Railways asset. That alone can explain such a sharp decline in the price of the shares of the state-owned company: the sale was held as a Dutch auction: the price was gradually lowered until one of the bidders accepted the announced price.

As a result, the oligarchs paid only 2.3 billion rubles for a block of shares in CSPC. Today, this is even less than the company's annual net profit (2.8 billion in 2021) and 25 times less than its annual revenue (57.7 billion).

Billionaire from Mytishchy

Anna Boeva was born in 1983 in the city of Glukhov, in the Sumy region of Ukraine. Then she lived in Kursk until she moved to the Moscow Region. At first, she worked as a manager in the advertising agency Milk. After that she got a job at MPC as a legal advisor, where she rose to become head of the legal department. She owns a 2012 Honda.

On her VKontakte page, the owner of the largest commuter rail carrier shares free photo coupons with her friends and reposts her «philosophical» and «down-to-earth» quotes. But she did have a premonition she would receive a major asset from Russian Railways. A few years before the deal with the state-owned company, she published a poem on her page: «Life is a very strange thing. Luck comes to you, but without knocking.»

«Keep on dreaming... And never think that dreams don't come true. Decent people's dreams always come true. You just have to know how to wait,» Boeva shared her life’s wisdom with her friends. If Anna dreamed that she would succeed in business without having any grounds for it at all, her recipe to keep on dreaming can be considered a success.

In addition to her stake in CSPC, Boeva owns Avtopass LLC, which developed a contactless payment system. She also owns Datapaks, a contactless payment system for public transport that is being implemented in the Moscow region, Nizhny Novgorod, Kaliningrad, Omsk and other cities. She also controls a stake in Technopass, a unified federal system for monitoring and controlling passenger transportation by buses (a business run jointly by the Rostech State Corporation and the Rotenberg family).

Through her firm Transnavisoft LLC Boeva is engaged in the implementation of a passenger transport dispatching system (the firm has earned more than 100 million rubles in government contracts). She is also the beneficiary of the Odnakassa system (a ticket purchasing aggregator co-operating with state carriers).

Criminal ties

Andrei Bokarev and Iskandar Makhmudov are longtime partners. They own shares in the Ural Mining and Metallurgical Company, Kuzbassrazrezugol, Transmashholding (they supply passenger trains and cars, subway trains and locomotives). They are among the leaders in the field of state contracts.

Andrey Bokarev
Andrey Bokarev

Makhmudov and Bokarev were involved in several criminal cases as businessmen who assisted in laundering criminal money. A 2007 German criminal case describes them as money launderers for the Izmailovo organized crime group, while a 2008 Spanish criminal case says that money from the Tambov-Malyshev organized crime group was also laundered through UGMK, a company they own.

They also have extensive connections in government circles. For example, one of Bokarev’s and Makhmudov's business partners is Alexei Krivoruchko, currently Deputy Minister of Defense of Russia. Until 2017, Bokarev and Makhmudov held shares in the Kalashnikov arms concern. Putin decorated Makhmudov with the medal of the Order «For Merit to the Fatherland.”

Iskandar Makhmudov
Iskandar Makhmudov

Yet, Bokarev and Makhmudov are not on the EU sanctions lists, even after the scandal in France: a journalistic investigation revealed that Makhmudov passed bribes to close associates of French President Emmanuel Macron.

Uzbek connection

Iskandar Makhmudov was born in Bukhara and spent his childhood and youth in Tashkent. It turned out that one of the new co-owners of Russian Railways' assets also has links to Uzbekistan.

At the end of May, MPC, through which Bokarev and Makhmudov themselves hold their shares in CSPC, changed its ownership structure. The Cypriot company Fredlake Holdings was replaced as the founder by five Russian legal entities. Violan belongs to Makhmudov, Elarium belongs to Bokarev, New Solutions and Postulat belong to Transmashholding’s top managers Kirill Lipa and Dmitri Komissarov, and KTS’s beneficiary is Daniyar Kamilov, the son of former Uzbek Foreign Minister Abdulaziz Kamilov. He recently took the post of special representative of the president of Uzbekistan on foreign policy.

In Russia, Kamilov Jr. worked in the Gazprombank system. He now owns the Eastern Logistic Company, which is engaged in rail freight transportation. At home in Uzbekistan, he is also involved in the privatization of state assets.

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