In the footsteps of Berezovsky: Would ‘Ural sovereign’ return from London?
When former Governor of Chelyabinsk Region Mikhail Yurevich did not arrive from Israel to be questioned by the Investigative Committee of the Russian Federation (ICR) but instead flew to London, many experts have concluded that the politician follows in the footsteps of Berezovsky and won’t return back to Russia. However, the business empire built by Yurevich while being in power is too vast and profitable to abandon it. Perhaps, he would be willing to give up a portion of his business in exchange for patronage of a powerful figure able to exonerate him from all charges at home?
On April 10, 2017, Mikhail Yurevich, ex-Governor of the Chelyabinsk Region, was supposed to return to Chelyabinsk and report for questioning to the Fourth Investigations Directorate in the Urals Federal District of the ICR. The businessman and politician nicknamed ‘Ural sovereign’ in his home region was expected to fly from Israel where he has been residing since the end of 2016 – after a failed attempt to be elected a Deputy of the State Duma once again and acquire parliamentary immunity. However, Yurevich decided to fly not to Chelyabinsk, but to the UK that has already become a ‘new motherland’ for many Russian oligarchs.
According to lawyer Igor Trunov, the ex-Governor went to London to be examined by an oncohematologist. Trunov states that as soon as the doctors finish their job, his client would return to Russia and report for questioning.
Of course, the explanation provided by the attorney is indefensible: Israeli medics are known among the best in the world; they could perform any required examination. Therefore, Yurevich went to the Great Britain not because of the medical needs. There is another difference between the two countries: should Russia request his extradition, Israel would be the optimal option – provided that the ex-Governor has the Israeli citizenship. But apparently, he failed to prove his Jewish roots and had to relocate to the UK that never extradites people prosecuted for political reasons.
Of course, it would be difficult for Yurevich to pose as a ‘victim of the Kremlin’ after being a faithful apologist of Edinaya Rossia (the United Russia) Party, successful governmental functionary, and sponsor of humanitarian convoys to the Donetsk People's Republic and Lugansk People's Republic.
Now the ex-Governor is desperately trying to pose as a fighter against the authoritarian regime: he has publicly broken off with Edinaya Rossia and gave an opposition interview to the BBC criticizing the Presidential Administration and denouncing the political system of Russia.
But there might be a ‘Plan B’ as well: Yurevich understands that all his efforts are likely to fail and plays for time trying to get in touch with powerful people in Russia able to exonerate him from all charges.
Yurevich has been accused of receiving a bribe from Vitaly Teslenko, ex-Minister of Health of the Chelyabinsk Region, (Article 290 of the Criminal Code of the Russian Federation) and instigation to slandering Fedor Vyatkin, ex-Chairman of the Regional Court, (Articles 33 and 128.1 of the Criminal Code of the Russian Federation). On April 4, 2017, attorneys of the ex-Governor of the Chelyabinsk Region have received the case file and noted that it contains more than 700 pages. The defense believes that Yurevich is facing fines and confiscations for the total of 208 million rubles ($3.7 million) and up to 15 years behind bars. In order to ‘close’ such a large-scale and high-profile criminal case, great powers and strong willingness to help the suspect are required. Therefore, Yurevich has to share with the ‘right person’ a big piece of his business empire built while being a Deputy of the State Duma, Chelyabinsk Mayor, and Governor of the Chelyabinsk Region. He possesses enormous resources: although the politician has lost all his official posts and became a suspect in a criminal case, the empire of the ‘Ural sovereign’ still exists and prospers.
Of course, it would be difficult for Yurevich to give up a portion of his business empire: he has spent many years and colossal efforts to build it. A fellow alumnus of the former Governor told the CrimeRussia that Yurevich had started a business being a student of the Chelyabinsk State Technical University. He was not willing to serve military obligations and managed to acquire a military service exemption certificate. He did not have a start-up budget and had to work for money to earn it. After the university lectures, he was digging graves on a Chelyabinsk cemetery for several months and saved enough money to buy a simple Zhiguli car. Then he started carrying goods for sale from other regions on that car, made some money, and founded Temp company specializing in grocery wholesaling.
In 1993, the graduate with a construction engineering diploma became the Director of the Bread Factory № 1 of Chelyabinsk. In a few years, Yurevich has created an association of enterprises entitled Makfa Agro-Industrial Holding and became the Chairman of the Board of Directors in it. The holding included Makfa Flour Milling Plant, Bread Factory № 1, Sosnovsky Bread Products Combine, ATP Temp-Avtotekh, etc.
A successful businessman of the ‘era of red jackets’ had promptly understood that the ‘turbulent 1990s’ were coming to the end and closeness to the circles of power could bring more money than any business. Therefore, Yurevich has started a political career. He quickly understood that the total and absolute support in the local media is the main prerequisite for it – otherwise, the news outlets could uncover plenty of compromising information from his past. The future governor decided to create a media empire concurrently with the business empire. First, he has bought up shares of Vecherny Chelyabinsk (The Evening Chelyabinsk), a popular local newspaper, and it immediately started working on his positive image. By the beginning of the 2000s, Mikhail Yurevich had in possession a huge media holding uniting dozens of local papers and magazines. With their support, the businessman has won the elections in 1999 and became a Deputy of the State Duma of the Russian Federation.
The Deputy’s duties were consuming too much of his time and drawing him away from the business that required constant attention. Therefore, the Deputy decided to become the Mayor of his home city and easily won the elections in 2005.
At the new post, Yurevich had behaved not as a governmental servant, but as a typical ‘new Russian’. He has quickly transformed a million-plus city into Chelyabinsk Limited Liability Company. The Mayor was solely focused on his personal affairs and enrichment. He did not care much of his low popularity among the residents of Chelyabinsk and local elites. Yurevich understood very well: the opinion of the Kremlin is the only factor that does matter. The Mayor did his best to maintain and strengthen ties with the Presidential Administration – and this strategy has paid off in 2010. Dmitry Medvedev, then-President of the Russian Federation, had surprisingly picked Yurevich from the five candidates proposed by Edinaya Rossia to be appointed the Governor of the Chelyabinsk Region.
Upon taking the new office, the Governor has shown his business talents in full. Chelyabinsk Limited Liability Company has been transformed into Chelyabinsk Region Limited Liability Company. Similarly with Puss in Boots fairy tale, all the assets in the region became the property of Marquis de Carabas. Methods used by Yurevich can be illustrated by the story of Greenflight Limited Liability Company controlled by the Governor. In 2011, the South-Ural Housing and Mortgage Corporation (SUHMC) Joint Stock Company belonging 100% to the Government of the Chelyabinsk Region has suddenly decided to transfer its lands to a totally unknown development company created a week ago at a symbolic price. By making such a ‘generous gift’, the state corporation has sustained a shortfall in profits in the amount of 2.6 billion rubles ($46.3 million). Furthermore, SUHMC has transferred to the novice developer its rights for the already-commenced complex development of Parkovy neighborhood that was in high demand with the population. Greenflight has implemented the project using funds provided by the housing co-investors without investing a penny of its own or borrowed funds. In addition to the administrative resource use, all potential competitors to the newly-created developer were eliminated from the market.
On the next year, after selling all the residences in Parkovy neighborhood, Greenflight has announced a new project – Akadem Riverside neighborhood – and collected money from construction co-investors as a prepayment for the future living space. However, the funds have been spent not on residential construction, but to build Almaz (Diamond) Trade and Entertainment Center. The hoodwinked co-investors have ended up with nothing and still can’t receive their prepaid apartments. In June 2016, a criminal case has been initiated due to this fact under part 4 of Article 159 of the Criminal Code of the Russian Federation (swindling on an especially large scale); on April 12, 2017, the preliminary investigation of that case was extended. In total, the hoodwinked co-investors have lost 11 billion rubles ($195.9 million). Sergei Manuilov, ex-Director of Greenflight, has been charged under part 2 of Article 201 of the Criminal Code of the Russian Federation (abuse of authority that has involved grave consequences). The Federal Security Service (FSB) of the Russia Federation has recently joined the investigation, which indicates potential criminal implications for Yurevich in the framework of that case.
In all other episodes, the Governor was seizing assets of the Chelyabinsk region in the same blatant and open manner as in the Greenflight case. He has pillaged the region like Attila the Hun. Local media outlets bought by Yurevich had kept silence and only reported various achievements of the Governor. Everything was fine until Yurevich has attracted the attention of federal media. Following an instruction from Yurevich, First Vice Governor Oleg Grachev had launched a smear campaign against Fedor Vyatkin, Chairman of the Regional Court. The scandal was too high-profile, and the Presidential Plenipotentiary Envoy of the Russian Federation to the Ural Federal District had to interfere. Grachev was dismissed; a criminal case has been initiated against him for slander. Then FSB operatives started an inquest against Yurevich – apparently, following instructions from Moscow. As a result, several criminal cases have been instituted against people from the Governor’s inner circle; corruption episodes were exposed.
But Yurevich somehow managed to retain his post. The Governor continued living in grand style, purchasing Italian helicopters for 300 million rubles ($5.3 million) at the budget expense, and throwing multimillion banquets in his suburban residence. This was a big mistake – his posh lifestyle had attracted the attention of anticorruption crusaders on a regular basis, and ultimately Moscow became tired and sick with his lordly manners. In January 2015, Yurevich was offered to resign voluntarily. His connections had saved him from being dismissed “due to loss of trust”.
Yurevich had dropped out of sight for a long period of time. After the buzz has calmed down, he made another attempt by participating in the Edinaya Rossia primaries in 2016 – but was forced to withdraw his candidacy. Then the member of Edinaya Rossia has officially resigned from the party and attempted to run for elections as a self-nominated candidate. He managed to be included into the election list of the ‘pensioners’ party’, but the Central Election Commission of the Russian Federation has banned him from the elections. In the meantime, the FSB operatives had continued their inquest against Yurevich, and in March 2017, bribe-giving and slander instigation charges have been laid against the ex-Governor. Yurevich had to flee Russia and figure out how to surrender a portion of his business in exchange for patronage should his efforts to pose as a fighter against the authoritarian regime fail. In fact, he has plenty of wealth to share.
Family of Mikhail Yurevich
The empire built by Yurevich does not officially belong to him since the beginning of his political career. Elderly father of Yurevich, retiree Valery Mikhailovich, born in 1941, has become the owner of prosperous and profitable Makfa flour milling company.
Currently he officially owns the following companies: Emitent Consulting Limited Liability Company, TK Perekrestok (Crossroads Trade Company) Limited Liability Company, Universam №9 Limited Liability Company, Temp Interservice Limited Liability Company, Media Center Management Company Limited Liability Company, etc. In addition, Yurevich senior is the owner of Ural Media Limited Liability Company and Media Center Information Company Limited Liability Company uniting the 31st TV Channel, Ekho Mockvy v Chelyabinske (Echo of Moscow in Chelyabinsk) radio station, and FDM Chelyabinsk radio station.
Most importantly, Valery Yurevich is the Chairman of the Board of Directors in Makfa Open Joint Stock Company, the backbone of the empire. He owns 71.42% of its shares. Elderly mother of Yurevich, Natalia Evgenievna, born in 1942, is a member of the Board of Directors in the agro-industrial complex; she owns 19.29% of its shares.
The bakery empire of the Yurevich family is not only a major food producer, but also one of the largest regional developers. Makfa Open Joint Stock Company is the owner of Rodnik (Spring) Limited Liability Company that, in turn, owns Rodnik Trade and Entertainment Complex with the total commercial space over 135 thousand square meters. The four-storey building accommodates more than 170 stores, Kinomaks multiplex cinema with 8 theaters, and Megaland children’s playground complex. By the way, immediately after the construction of the trade and entertainment complex, an access road to it has been built at the budget expense.
Rodnik Trade and Entertainment Complex
Rodnik development company also owns 14-storey elite Radisson Blu Hotel in Chelyabinsk and above-mentioned Almaz (Diamond) Trade and Entertainment Center built using the funds provided by the hoodwinked co-investors of Akadem Riverside.
Controlling blocks of shares in companies owning three trade centers, a major store in Chelyabinsk, and several cinemas also belong to the parents of Yurevich. It is not surprising that a retired couple owns so much real estate in the regional capital – after all, they have raised a Mayor of their home city.
Interestingly, the pensioners have shown their business acumen only in the afternoon of their lives, when their son has left the business to build a political career and was elected a Deputy of the State Duma of the Russian Federation. Prior to becoming a successful businessman, Valery Yurevich had worked as a brick mason in the Building and Construction Department №42. Natalia Yurevich had been teaching in a medical college of Chelyabinsk for the most of her working life.
Another portion of the business empire of Yurevich officially belongs to some Aleksander Moskalyuk who used to be the Governor’s personal driver and was nicknamed ‘batman of Yurevich’. Concurrently with running his ‘own’ business, he continued to perform the driver’s duties. Later Moskalyuk has become a suspect in the criminal case against his boss. During the investigation, the ‘trusty batman’ was reclassified from a suspect into a witness and managed to flee Russia: Yurevich has helped him to relocate to Israel, far from the Russian law enforcement.
The former chauffeur still owns a portion of his boss’s business, including Stroyzakazchik Limited Liability Company, Severny Bereg (Northern Shore) Trade and Exhibition Center Limited Liability Company, Uspekh (Success) Limited Liability Company, Progress Limited Liability Company, UK Rodnik (Spring) Limited Liability Company, and Vecherny Chelyabinsk (The Evening Chelyabinsk) Publishing House Limited Liability Company. In addition, Moskalyuk is a co-owner of Production Housing Repair and Operation Administration of the Kurchatovsky District Management Company Limited Liability Company, Remstroy Limited Liability Company, Zhilavtotrans Limited Liability Company, Parkovki Plus Limited Liability Company, and notorious developer Greenflight that had stolen 11 billion rubles ($195.9 million) from hoodwinked co-investors.
Of course, the elderly parents can’t manage such a huge business empire on their own. Moskalyuk can’t assist them in this because he has to stay in Israel. Therefore, all the financial affairs of the ex-Governor are currently handled by his trusted business partner Vadim Belousov.
The most nonpublic politician of the Southern Urals managed to be elected to the new convocation of the State Duma as a member of Spavedlivaya Rossia (the Just Russia) Party – although not in his home region, but in the adjacent Kirov region. Of course he had to pay for the Deputy’s chair and immunity: Makfa Agro-Industrial Holding has acquired Kirov-based Absoluyt-AGRO Limited Liability Company owning a fodder plant and a meet-processing plant. The list of founders of this profitless company currently undergoing the liquidation procedure clearly explains why the prosperous agro-industrial holding had purchased it.
The founders of Absoluyt-AGRO include Taisia Doronina, mother of Sergei Doronin, leader of the Kirov branch of Spavedlivaya Rossia. He was the first in the regional election list of the party during the elections to the State Duma. After the elections, he has resigned his Deputy’s seat and transferred it to Vadim Belousov who was the second in the regional list of Spavedlivaya Rossia. Apparently, this was done for a humble reward – acquisition of a profitless family business by Makfa.
It is pretty understandable why the agro-industrial holding had agreed to buy a Deputy’s chair for Belousov. Since September 2016, Makfa is managed by Anton Belousov, son of Vadim Belousov. Mikhail Yurevich has personally appointed him to this position during a short visit to Russia from Israel. The ex-Governor had to terminate the previous manager – Sergei Turkovsky, a Deputy of the Regional Legislative Assembly representing Edinaya Rossia. This reshuffle was necessary to ensure that Belousov senior manages properly the primary and most profitable asset of Yurevich via his son.
According to a CrimeRussia source, Yurevich does not fully trust even his loyal comrade Vadim Belousov. Not to mention his son. Therefore, he has appointed another faithful person – his paternal cousin Yulia Ivanova – to keep an eye on Anton Belousov. Yurevich appointed his female relative to the key post of the Financial Director. This enables him to retain control over the financial flows in his hands.
It would be easier for the father and son Belousov to manage the business of Yurevich if he relocates to Moscow or the Moscow region. This option is acceptable for the ex-Governor as well: the farther from Chelyabinsk and its headaches (searches, seizures of documents, local FSB, etc.) the better. And perhaps, closer to the future recipient of a portion of his business in exchange for dismissal of the criminal case. The preparations for the ‘relocation’ and partition of the Ural business empire have already started. In the end of 2016, a record has been made in the Consolidated State Register of Legal Entities: Makfa Open Joint Stock Company started reorganization in the form of severance. This means that one or several companies would assume rights and liabilities of the reorganized holding. In the meantime, the holding would continue its operations. Some Ramkon Limited Liability Company founded by Makfa has been identified as the successor. The new company is incorporated in the town of Ramensky of the Moscow region and is a tax resident of the Moscow region.
Overall, all the preparations for bribe-giving in exchange for high patronage have been made. The question is: who is going to accept a portion of the profitable business empire of Yurevich and save its creator from justice?
Lieutenant General Oleg Troshin announced he is going to retire in May 2018. He is doing it following a decision taken a year ago – not due to non-existent issues with the agency reported by some local media outlets.