Governor or ‘King’? Oleg Korolev rules Lipetsk region for 19 years
Oleg Korolev, the Head of the Administration of the Lipetsk Region, has been in charge of the region for almost 19 years. During this period, numerous accusations had been brought against him: lobbying interests of certain businessmen, raiding takeovers of enterprises, machinations with budget funds, etc. His only competitor is local oligarch Vladimir Lisin. But there is an unspoken arrangement between them: the governmental functionary and the businessman have divided the spheres of influence in the region, and none of them impinges upon his rival’s assets.
There are some officials in Russia, who manage to held their posts for long years – despite high-profile corruption scandals, conflicts with other authorities, and poor performance. The secret of their irremovability is simple: harsh elimination of any competitors able to supersede them. Sometimes this includes physical liquidation. Henchmen of Governor Korolev were involved not only into economic, but also into felonious crimes. Apparently, his rule is about to end soon.
There were plenty of talks in the Lipetsk region about the upcoming resignation of Oleg Korolev – but every time the Head of the Administration had managed to shrug off the corruption accusations and get off the hook.
Oleg Korolev, the Head of the Administration of the Lipetsk Region
The official biography states that Oleg Korolev had started his career in the Dolgorukovskoe forest enterprise. However, he quickly switched from the maintenance of greenery to administrative work. In 1987, he became the Secretary of the Dobrinsky District Committee of the Communist Party of the Soviet Union, three years later was elected a Deputy of the Lipetsk Regional Council of People’s Deputies, and then worked in the Council of the Federation. Oleg Korolev has won the gubernatorial elections in the Lipetsk region on April 12, 1998 and holds this position since then.
During almost 19 years of governorship, he managed to lay hands on all main levers of power in the region, except for one – Novolipetsky Metallurgical Plant, the largest enterprise in the region belonging to oligarch Vladimir Lisin.
Oleg Korolev clings to power and does not tolerate any criticism. The level of public trust in the ‘anti-corruption crusader’ is very low. For example, Novaya Gazeta newspaper wrote about the termination of Aleksander Skiperskikh, the Professor at the Philosophy Department of the Bunin Yelets State University, for organization of an Internet survey of the public confidence in the Governor.
Aleksander Skiperskikh, the Doctor of Political Sciences, is known to the public as the organizer of a number of social and political events. The most famous campaign of Skiperskikh and his followers, noticed not only by the Russian, but also by foreign media, was a series of ‘protest rallies by plasticine manikins’. This is how the public activists have expressed their stance on the acceptance of prohibitive amendments to the legislation regulating public rallies.
Protest rally by plasticine manikins
Then the professor has conducted an Internet survey: “Do you trust Oleg Korolev, the Head of the Administration of the Lipetsk Region?” Only 8.1% of the respondents have answered in the affirmative. It turned out that 61.3% of those surveyed do not trust the Governor, while 11.6% “rather do not trust” him. Apparently, Korolev was not happy with such results.
The Rectorate of the Bunin Yelets State University had tolerated the ‘plasticine rallies’ and other protest actions conducted by Aleksander Skiperskikh and his followers – because those were targeting the federal or municipal authorities – but two days after the controversial survey of the public trust in the Governor, an order to terminate the professor has been issued.
Machinations through Posagrolizing Open Joint Stock Company
One of the reasons behind the public distrust in the Governor are numerous corruption scandals, machinations with budget funds, and lobbying of interests of certain businessmen. These entrepreneurs have been nicknamed ‘king’s pool’ by Lipetsk residents. The ‘friends’ of the Head of the Administration include: Oleg Donskikh, Sergei Burdovsky, Igor Konyakhin, Sergei Krasovsky, Aleksander Fomichev, etc. The Governor had always supported all initiatives of these people – even the most venturesome ones.
A high-profile criminal case initiated due to the embezzlement of budget funds through Posagrolizing Open Joint Stock Company refers to 707 million rubles allocated for construction of a rape oil plant in the Lipetsk region. Liboil Limited Liability Company had intended to produce 120 thousand tons of oil annually. After the successful spending of the budget funds, it turned out that regional agricultural enterprises are unable to provide the plant with even a half of the required raw material, while acquisitions of rape in other regions would be economically unviable.
Opening ceremony of the Liboil plant in the Lipetsk region
A project to construct a distillery in the Lipetsk region has also resulted in a fiasco. The debt of the project initiator, Central Vodka Company Limited Liability Company, to Posagrolizing Open Joint Stock Company is some 2 billion rubles. In total, companies belonging to the members of the ‘king’s pool’ have received over 4 billion rubles from the budget; some 500 thousand out of that amount have been simply embezzled. Obviously, the businessmen could not perform such machinations without involvement of Oleg Korolev.
Agrokhim Open Joint Stock Company controlled by Aleksander Fomichev had been receiving subsidies in the framework of the National Program “Development of the Agroindustrial Complex” as well as credits and budget provisions – despite its deplorable financial situation. The company was mortgaged and debt-ridden. Still, the officials have provided in total over 1 billion rubles to Agrokhim – while the representatives of the company had been frequently submitting fake documents to the regional agricultural department allocating subsidies.
According to Igor Osadchy, the former Financial Director of the company, Agrokhim had been established with the purpose to receive credits, cash the funds, and transfer portions of these funds to Cypriot offshore companies Alegro and Karnal-Invest Ltd. Osadchy was unwilling to participate in the financial machinations and resigned; then people from a criminal group close to Fomichev started threatening him; there was even a failed assassination attempt.
By the way, the security service of the businessman favored by the Governor of the Lipetsk Region had a real arms cache in the Odinstsovo district of the Moscow region. The impressive armory, including an anti-tank mine and an antipersonnel landmine, has been discovered by law enforcement authorities during a search in a facility belonging to a private security company. This company had been ensuring safety of Aleksander Fomichev – who is also known as an ‘authoritative’ businessman.
In addition, Sergei Dorovsky, the former Deputy Head of the Administration of the Lipetsk Region, who used to be the ‘right hand’ of the Governor for many years, has been charged in 2015 by the Investigative Committee of the Russian Federation (ICR) with organization of an attack of Igor Domnikov, a journalist of Novaya Gazeta. The author of critical articles about corruption in the Lipetsk Regional Administration was assaulted in the lobby of his house; his skull was broken with a hammer; and he died in a hospital two months after the incident.
Such people are the friends of Oleg Korolev.
Murder of Mikhail Pakhomov
Another high-profile scandal affecting the Governor was linked with the murder of Mikhail Pakhomov, a local businessman and Deputy of the Lipetsk Municipal Council. His body was discovered in a garage located in Obukhovo settlement of the Noginsk district of the Moscow region. The corpse was found in a barrel, cast in cement.
12 people had been arrested in the framework of this criminal case, including Evgeny Kharitonov, the former Deputy Minister of Housing and Utility Infrastructure of the Government of the Moscow Region. The operatives have caught him in Sheremetyevo International Airport, on the airstair of a plane: the official intended to flight to Krasnodar and go on the run. 7 people have been sentenced for this crime; according to the court verdict, the extortionists had demanded 85 million rubles from the businessman.
The unofficial version of this murder is more pragmatic. In 2011, Mikhail Pakhomov had participated in the primaries of Edinaya Rossia (the United Russia) Party and could become one of the leaders in the election list of this party. But shortly before the elections, he has made a fatal mistake – announced publicly his readiness to become the Head of the Lipetsk Region. Apparently, the Governor’s retinue have decided that political ambitions of Pakhomov pose a real threat.
The investigation of the murder is completed; no one had ever pressed any charges against the Governor. However, Evgeny Kharitonov, who, according to the court, was the mastermind behind this crime, is a relative to businessman Sergei Krasovsky – a member of the above-mentioned ‘king’s pool’.
The way how Mikhail Pakhomov was murdered – a traditional method of mafia – has become a warning for politicians and businessmen of the Lipetsk region. This has cooled down the ambitions of potential competitors to Oleg Korolev – and at the next election, he had no serious rivals.
Conflict with oligarch
The only opponent to the Governor in the struggle for political and economic dominance in the region is oligarch Vladimir Lisin, owner of Novolipetsky Metallurgical Plant; Oleg Korolev has to maintain status quo with him.
The conflict between Korolev and the influential businessman goes back to the end of the 1990s – at that time, the oligarch had acquired serious political ambitions, including possible participation in the gubernatorial elections. The confrontation between the two most powerful figures in the region had escalated in 2000, amid the upcoming elections to the Lipetsk Municipal Council of Deputies – both the oligarch and regional administration tried to carry their own people there.
“Metallurgists have nothing to do in the politics,” – Oleg Korolev said at that time.
However, an interference of the federal center has allowed to smother up the unfolding conflict for some time.
“I do not want to force my way, thus, worsening the split in the region. My participation in the elections would cause further escalation of the conflict and entangle into it people who would be destroyed,” – Vladimir Lisin has explained his renouncing of political ambitions.
According to the oligarch, the conflict has started when Novolipetsky Metallurgical Plant, being the largest taxpayer in the region, had decided to figure out: how wisely the budget funds are being spent and why the social programs never receive sufficient funding? In return, the officials started blaming the enterprise for all regional issues using media sources under their control.
Taking that one in three Lipetsk residents works at Novolipetsky Metallurgical Plant or is somehow related to it, and that the majority of budget revenues are generated by the metallurgists, it is easy to imagine how upset were the local people with the smear campaign launched by the Governor against the enterprise.
Vladimir Lisin and Oleg Korolev have an unspoken arrangement: they have divided the spheres of influence in the region, and none of them impinges upon his rival’s assets. Still, the confrontation between the Governor and the oligarch escalates before every election. The Kremlin prefers not to interfere into this.
In his speeches, Oleg Korolev often poses as a true anti-corruption crusader. He claims that the high investment rating of the Lipetsk region is one of his achievements – because this indicates a low level of corruption in the region.
However, the rule of Oleg Korolev is about to end soon; the Presidential Administration is already looking for his successor.
According to the investigation, having taken a five-billion loan ($88.7m) from Sberbank in 2008, the owner of Pavlovskgranit deliberately split up the assets of the company so that creditors could not bring a charge against him to court.