Downfall of smuggling paradise. Far Eastern businessman drags down top customs functionaries
The arrest of famous Far Eastern businessman Rodion Tikhonov became a surprise for many people. It was another blow to the myth of ‘untouchable figures’. In the new reality, the number of persons whose connections in the circles of power (either federal or regional) allow them to live by their own rules is steadily decreasing. Amid the increasingly popular fight against corruption, it is hard to say whether a once-omnipotent figure has fallen victim to the competitive struggle or the law enforcement authorities have finally decided to put an end to his lawlessness. With regards to Tikhonov, the latter scenario seems to be more likely – because he had eliminated all major competitors many years ago. It is necessary to note though that contenders for the newly-vacant niche have already appeared and the regional import market may face another redistribution.
Prominent Far Eastern businessman Rodion Tikhonov and several other people involving into smuggling operations, including a high-ranked customs officer, have been arrested in Vladivostok on February 21, 2018 by the brigade of the Central Headquarters of the Federal Security Service (FSB) of the Russian Federation on suspicion of importing 80 containers of fur coats and textile products under the disguise of cheaper goods. Then the six suspects have been escorted to Moscow, and on February 26, Basmanny District Court remanded them in custody. Initially, Tikhonov was charged under Article 194 of the Criminal Code of the Russian Federation (evasion of customs payments collected from organizations or persons). But later it became known that Rodion Tikhonov and his business partners Dmitry Khodyachikh, Evgeny Oksiyuk, Denis Mars, and Aleksei Nabok have been charged under parts 1 and 2 of Article 210 (creation of a criminal community (criminal organization) and participation therein) and part 4 of Article 194 of the Criminal Code of the Russian Federation (evasion of customs payments collected from organizations or persons on an especially large scale). It is also known that Dmitry Khodyachikh, Director of Hard-Ek wholesale trade company, has refused to testify citing Article 51 of the Constitution of the Russian Federation. Another suspect in this smuggling case – Evgeny Romanchenko, Deputy Head of Morskoi Port Vladivostok (Seaport Vladivostok) Customs Post, – has been charged under part 6 of Article 290 of the Criminal Code of the Russian Federation (bribe-taking by a functionary on an especially large scale).
Immediately after the high-profile arrests, residents of the Primorsky krai started speaking that such an extensive smuggling network could not exist without ‘patronage’ of the regional customs directorate. People supposed that the suspects escorted to Moscow had constituted only a part of the criminal community, and anticipated more arrests in the region. The expectations have come true a few days ago. On March 20, 2018, Sergei Fedorov, First Deputy Head of the Far Eastern Customs Directorate of the Federal Customs Service of the Russian Federation, has vacated his office accompanied by FSB operatives. The functionary is suspected of close ties with the smugglers. On March 22, the court has remanded him in custody until May 19, 2018.
According to the investigation, since December 2015 to October 2017, Fedorov had received bribes from Rodion Tikhonov on a regular basis for general patronage of Dal’zavod Terminal Closed Joint Stock Company belonging to the businessman. During the two years of mutually-beneficial collaboration, the customs official has ‘earned’ 26 million rubles ($455.3 thousand) and $150 thousand. In exchange, he had directed the work of the Far Eastern Customs Directorate in the interests of Dal’zavod Terminal and assisted in solving virtually all customs issues arising in relation to the import of consumer goods into the Customs Union. No one could decline a ‘request’ from Fedorov – he had wielded too much power in the Siberian and Far Eastern customs services and could easily ruin the career of an uncooperative subordinate.
Sergei Fedorov has been serving in the customs authorities since 1994. Started his career as an inspector of the Customs Protection Department of the Novosibirsk Customs Directorate. In 1997, was appointed an inspector of the Customs Registration and Control Department of the Novosibirsk Customs Directorate. In 2004, was appointed the Head of Kalininsky Customs Post of the Novosibirsk Customs Directorate. In 2008–2011, the customs service colonel was in charge of the Novosibirsk Customs Directorate. In 2011–2014, was the Head of the Altai Customs Directorate. In 2014, has been transferred to Vladivostok and appointed the First Deputy Head of the Far Eastern Customs Directorate. Two months before the arrest, has been awarded the medal of the Order of Merit for the Fatherland II Class. The reward order was signed by Vladimir Bulavin, Head of the Federal Customs Service, pursuant to the Presidential Decree.
It must be admitted that the reward was granted to Fedorov prematurely. Similarly with the other members of the smuggling group, Fedorov has been escorted to Moscow. The investigators intend to charge him under part 6 of Article 290 of the Criminal Code of the Russian Federation (bribe-taking by a functionary on an especially large scale). The criminal case against the high-ranked customs official indicates that other suspects are actively collaborating with the investigation and turn in the remaining participants of the criminal scheme. Therefore, new arrests among functionaries of the Primorsky krai are more than likely. Furthermore, charges laid against Fedorov – who was taking bribes for years – imply that the fraud scheme created by Rodion Tikhonov was not a one-time episode – but had been running for years. The scope of the criminal scheme indicates close ties between the smuggling community and top-rank regional officials. This is why the supreme command of the Far Eastern Customs Directorate have been notified by the FSB of the special operation post factum – the operatives had to prevent any information leaks in anticipation of the forthcoming arrests. It is unknown yet what other customs officers, in addition to Fedorov and Romanenko, had turned a blind eye to the smuggling. However, a reshuffle has been made in the Far Eastern Customs Directorate immediately after the arrests. Viktor Saburin, Head of Morskoi Port (Seaport) Customs Post, became the Acting Head of Vladivostoksky Customs Post (customs e-filing center), while customs service major Andrei Stepanyuk has taken up his former position. The regional directorate had tried to credit itself for the exposure of corrupt customs officer Evgeny Romanenko claiming that the agency “has been systematically and consistently purging its ranks from corruption”. But no self-praises were expressed after the arrest of Sergei Fedorov.
Rodion Tikhonov is considered the largest customs broker in the Primorsky krai. He owns Dal’zavod Terminal Closed Joint Stock Company specializing in container cargo processing. He also owns 14 other companies specializing in property management, logistics, and foreign trade, including Sea Trade (fish product trade), TELSI Limited Liability Company and AVL Servis (cargo transportation and storage), Kiparis (Cypress) Limited Liability Company (residential and commercial construction), and ship operators NPF Aeromor, DVTB Limited Liability Company, and Tark Limited Liability Company. However, his main asset is Dal’zavod Terminal Closed Joint Stock Company – a temporary storage warehouse for container cargo located in the center of Vladivostok. The total warehouse area is almost 20 thousand square meters; the length of its harbor wall is 260 meters, while the warehouse space and technical equipment make it possible to stockpile up to five layers of containers and simultaneously store 14,400 20-feet containers there. In November 2017, gross violations have been identified at the warehouse resulting in arrests of businessmen and high-ranked officials in the Primorsky krai.
Customs post of the Vladivostok seaport
It is now obvious that the smuggling business of Tikhonov had been flourishing for years, while the regional law enforcement authorities were turning a blind eye to it. The question is: how the operatives of the central FSB headquarters could uncover the criminal scheme from the other end of the country? A scandal involving the Kingisepp Customs Office, seemingly unrelated to Vladivostok, had preceded the FSB operation in the Primorsky krai. In March 2016, the law enforcement authorities have busted a major illegal channel used to ship alcohol and some prohibited imports (European cheese, bacon, etc.) to Russia. Three companies involved into the criminal scheme (Southeastern Trade Company Limited Liability Company, Peleng Limited Liability Company, and Dalvars Limited Liability Company) had operated in the so-called ‘green sector’ – i.e. were authorized economic operators enjoying significant customs preferences.
An authorized economic operator is a Russian legal entity importing goods to and exporting those from the Russian Federation according to special simplified customs procedures that considerably expedite the customs operations. The authorized economic operator status is acquired through the inclusion of a legal entity into the relevant register and issuance of the respective certificate. The register is maintained and updated by the Federal Customs Service of the Russian Federation.
Any businessman specializing in foreign trade is interested to simplify the customs procedures. The collaboration with an authorized economic operator brings a number of benefits, including the possibility to temporary store goods undergoing the customs control procedure without inclusion of those into the register of the temporary storage warehouse, possibility to clear the goods prior to filing the customs declaration (i.e. the cargo is not surveyed by customs officers), and possibility to file incomplete customs declarations. Concurrently, the simplified procedure provides possibilities for criminal maneuvers and incites dishonest businessmen to create ‘shady’ import schemes for consumer goods. After the scandal with the Kingisepp Customs Office, a number of Russian authorized economic operators have been excluded from the register of the Federal Customs Service, while the others have been thoroughly audited. But somehow Portal Limited Liability Company, an authorized economic operator since 2011, belonging to Moscow businessman Erast Khrychev managed to avoid the audits. Dal’zavod Terminal belonging to Rodion Tikhonov had stored inter alia goods shipped to Portal. One of such shipments consisting of 80 containers has been busted on November 8, 2017 by FSB operatives. It is necessary to note that incorrectly declared goods had been repeatedly discovered there in previous months. Instead of the true contents of the imported containers, cheaper goods categories – dubbed ‘coverage goods’ by smugglers – were declared. The profits gained by container owners or carriers are obvious – customs fees on such goods are much lower. When the FSB operatives have entered Dal’zavod Terminal warehouse, 30 containers were already there, while the remaining 50 were still onboard the ship. The information was immediately conveyed to the Federal Customs Service, and on the same day its head Vladimir Bulavin has instructed Yuri Ladygin, Head of the Far Eastern Customs Directorate, to perform a reexamination of the containers arrested by the FSB operatives and intended for Portal Limited Liability Company. The reexamination has shown that bed cloths, textiles, and fur coats were declared as ceiling panels and doors. On the same day, Portal offices have been searched. Then the FSB has suspended the company’s authorized economic operator status by making a record in the register. The General Department of Anti-Smuggling of the Federal Customs Service has joined the investigation. Its officers performed operational procedures at Khovrino, Selyatino, Vorsino, and Kuntsevo railway stations located in Moscow and the metropolitan area.
Seized containers with smuggled goods
According to them, the criminal scheme supposedly created by the Far Eastern businessman jointly with Portal Limited Liability Company had involved not 80 but over 100 containers – both already received and remaining in transit from the Far East to Moscow region in November 2017. The total damages sustained due to the shortcoming in customs fees could amount to hundreds of millions of rubles.
The suspects in this criminal case are currently held in a Moscow pretrial detention facility because Tikhonov reportedly has close ties with the customs, governmental, and law enforcement authorities of the Primorsky krai. It can’t be ruled out that, being at home, the businessman may get off the hook using his extensive connections. The reason why the investigation is handled by the Moscow-based structures is that the suspects must have accomplices in the capital. It is not a coincidence that the General Department of Anti-Smuggling has performed its operations at the places of final destination of some goods shipped from Dal’zavod Terminal to the Moscow region.
The point is that on July 1, 2017, the Moscow Regional Customs Directorate became directly subordinate to the Federal Customs Service. Therefore, Krasnoznamensky and Mozhaisky customs e-filing centers have lost the authority to accept and clear shipments handled by other customs posts – so, Portal authorized economic operator could undertake a portion of the work with declarations. Some sources believe that the ‘shady’ import scheme has changed its customs clearance location after the reshuffle of the supreme personnel in the Moscow Regional Customs Directorate. Structures controlled by Tikhonov – a major customs broker able to render services allowing his clients to reduce costs and get around the import prohibitions – have immediately capitalized on this.
There is another version as well. Some experts link the recent arrest of Tikhonov with a redistribution of the smuggling market in the Primorsky krai. Currently, there are three major smuggling channels in the region and a few minor ones; almost all of those lead to Moscow and have well-known ‘high patrons’. In addition, some new players on the customs brokerage market having connections in the top echelons of the Federal Customs Service and eager to lay hands on the Far Eastern region are also based in Moscow. The niche occupied by structures belonging to Tikhonov – both legal and illegal ones – is of utmost interest for these players.
An open confrontation is currently ongoing between the customs directorate in Vladivostok and Dal’zavod Terminal Closed Joint Stock Company. After the discovery of containers with smuggled fur coats and textiles in November 2017, the customs officers have imposed a restricted operation regime at the enterprise, including sealing of the warehouse gates in the evening and night.
According to Dal’zavod Terminal representatives, in the period since November 2017 to January 2018, the enterprise has sustained losses amounting to 4.6 million rubles ($80.5 thousand) due to the actions of the customs authorities. In addition, the restrictions displease clients – numerous cars have to wait for opening of the once-24-hour terminal, delivery dates are missed, and the enterprise is facing penalties. An appeal against the restricted regime has been filed with the arbitration court. In anticipation of the court verdict, the Dal’zavod Terminal management is threatening to lay off 50 workers should the customs authorities refuse to cooperate. But now the owner of Dal’zavod Terminal is in custody at the other end of the country, and the chance that the customs officials bend to the pressure is very low. However, until quite recently, it was really difficult to imagine somebody purposively ‘ruining’ the business of Tikhonov.
So, who is Rodion Tikhonov and why this low-profile person had a reputation of a power broker (at least, in the Primorsky krai) with extensive connections in the regional government and law enforcement authorities? He used to wield such a power that any issues were resolved for his benefit, while anyone who dared to oppose him was ruined, or jailed, or even had disappeared without a trace. A native of Vladivostok, Tikhonov started running business back in the 1980s. In that period, he was convicted for the first time for a theft with aggravating circumstances and robbery (parts 2 and 3 of Article 144 and Article 145 of the Criminal Code of the RSFSR) and spent three years in jail. In 1996, was prosecuted again for currency exchange fraud – but the case has been dismissed in accordance with Article 9 of the Criminal-Procedural Code of the RSFSR (reconciliation with the victim). According to sources, during the investigation of one of these criminal cases, Tikhonov started secretly collaborating with the Committee for State Security (KGB) of the USSR (likely, in the period of the second inquest because the KGB used to put currency speculators under special control). Apparently, this was the beginning of the close friendship between the enforcement structures and future businessman. By 2000, criminal analytical reports intended for official use only had repeatedly noted that an organized criminal community specializing in raidership and smuggling under the leadership of two-time offender Rodion Borisovich Tikhonov was operating in the Primorsky krai. But such reports had never passed beyond certain desks.
Officially, Tikhonov was a successful burgeoning businessman; in the early 2000s, he has established a number of companies specializing in transportation (including marine transportation) and wholesale trade of goods, including imported ones. Former high-ranked KGB officers, who had joined the politics, and former officers of the Administration for Combating Organized Crime of the Administration for the Primorsky Krai of the Ministry of Internal Affairs (MIA) of the Russian Federation, who had transferred after the reorganization of the agency to the MIA General Administration for the Far Eastern Federal District, had patronized and supported him. The ‘Smosyuk case’ was one of the most notorious episodes in the business career of Tikhonov.
In the early 2000s, Vladivostok-based entrepreneur Anatoly Smosyuk had owned Vostok (East) Import Company specializing in fishery and having a fleet of five ships and representations in Kamchatka and Magadan. In 2002, the company value was estimated at some $15 million. That year, Vostok Import has contracted a loan of $1.5 million in Promsvyaz’eksport Bank and purchased pollock catch quotes for 2.5 thousand tons of fish. However, prior to the completion of fleet repairs and beginning of the fishing season – i.e. before using the quote – the company somehow incurred a debt of 8 million rubles (some $250 thousand) to Promsvyaz’eksport Bank. To recover the debt, the bank director addressed not the court but former KGB officer Aleksei Tyazhlov, law enforcement advisor to Sergei Dar’kin, then-Governor of the Primorsky Krai. Using the administrative resource, Tyazhlov has forced Smosyuk to hire a number of people, including Rodion Tikhonov, to the company’s protection service. A week after the recruitment of Tikhonov, Tyazhlov has demanded the company owner to transfer 40% of the equity capital to another person. Then this share was sold to a third person. After the murder of that man, the share has been transferred, through a complicated scheme, to Rodion Tikhonov. Journalist Marina Solovienko provided details of this raiding takeover in Narodnoe Veche newspaper. Ultimately, the confrontation between Tikhonov and Smosyuk has resulted in the following: Tikhonov, who initially wasn’t even a member of the Board of Directors, became the sole proprietor of the enterprise, while Smosyuk has been sentenced to 8 years behind bars for swindling. Immediately before the seizure of Vostok Import by Rodion Tikhonov, criminal cases were instituted against the son and daughter of Smosyuk for an alleged attempt to bribe a police officer. Apparently, policemen acting in the interests of Tikhonov had framed-up that episode. The struggle with Smosyuk and his relatives for the control over the enterprise had lasted for four years – and during this entire period, ‘high patrons’ of Tikhonov in the MIA Administration for Combating Organized Crime had provided the state protection to the businessman by including him into the relevant program.
Here is another illustrative episode in the business biography of Tikhonov: some Nina Dubograi had attempted to collect a payment for supplied products in the amount of several million rubles from Vostok Import in the period when Tikhonov was already in charge of the company. As a result, Dubograi was charged with swindling and arrested. Later the case against her was dismissed – but she never got her money back.
In 2009, police colonel Aleksander Astafiev, then-Head of the newly-established Center for State Protection of the MIA General Administration for the Far Eastern Federal District (and former department head in the MIA Administration for Combating Organized Crime), has openly named Rodion Tikhonov raider and smuggler and provided names of his ‘patrons’ in the law enforcement structures. According to the colonel, operatives of the MIA General Administration for the Far Eastern Federal District Aleksander Sarkisov and Andrei Vasilchenko and retired FSB general Aleksei Tyazhlov had covered-up the operations of Tikhonov. Astafiev has collected evidence that an organized criminal community under the leadership of two-time offender Rodion Tikhonov had operated in the Primorsky krai since 2000. “Corruption ties of Tikhonov with the law enforcement structures and judicial system are very strong; this has enabled him to avoid liability for his deeds for such a long period of time,” – states the report produced by the police analyst. The report describing the criminal scheme used to smuggle dozens of thousands of tons of goods via Vladivostok ports had been submitted to the Head of the MIA General Administration for the Far Eastern Federal District – who coincidentally was on vacation at that time – and ended up on the desk of his deputy Feliks Vasiliev. Vasiliev had very close ties with Tikhonov – during the short period of his service in the MIA Administration for the Primorsky Krai, he has even made a trip to South Korea using a fake ID on Korenovsk ship of Aeromor company belonging to Tikhonov to purchase a car for personal use. It is not surprising therefore that the report submitted by Afanasiev has resulted in institution of a criminal case against the colonel for exceeding official powers. In 2010, he has been sentenced to 4.5 years behind bars.
Another enforcement officer opposing Tikhonov has also been sentenced to a prison term. The businessman has accused transport police lieutenant colonel Viktor Prokopchuk of extortion. The officer had constrained operations of his ship Korenovsk smuggling cars to Russia under the disguise of auto parts. According to the official version provided by the investigation, the police lieutenant colonel had deceived the businessman pretending to possess authority to arrest the vessel and demanded to pay him $30 thousand and $5 thousand for each further entry of the ship to the port threatening otherwise to create artificial administrative barriers to his commercial operations. According to the unofficial version, Tikhonov has skillfully framed-up Prokopchuk. Ultimately, the police lieutenant colonel was charged with swindling and sentenced to 7 years behind bars. It is necessary to note that 2 years after the arrest of Viktor Prokopchuk, border guards have again found smuggled goods on Korenovsk ship returning from Japan, including expensive alcohol, coffee, and snowboards worth 15 million rubles ($262.7 thousand). The outcomes of that episode remain unknown.
It is unlikely that the investigators handling the current inquest against Tikhonov dig so deep into the past. There is no doubt however that new criminal episodes are to be uncovered and Sergei Fedorov, First Deputy Head of the Far Eastern Customs Directorate, is probably neither the last nor the most high-ranked suspect in this corruption and smuggling scandal.
Kupavnenskaya criminal group, known for a series of bloody crimes at the beginning of the decade, has been completely eliminated. The last of its active members who remained at large has been detained in Moscow.