independent

Thursday 17 April 2014

Chelsea owner admits he paid out billions in bribes

ROMAN Abramovich, the owner of Chelsea Football Club, has admitted agreeing to pay billions of dollars for political favours and protection fees to get his hands on the former Soviet Union's mineral wealth.

The puzzle of how the penniless street trader rose to amass a €14.4bn fortune is explained for the first time in his own words in court papers seen by an English newspaper.

Mr Abramovich paid older oligarchs so that he could obtain a big share of Russia's oil and aluminium assets and to escape unscathed from the deadly postcommunist carve-up. He famously emerged triumphant after the "aluminium wars", in which more than 100 people were believed to have been killed in gangland feuds over control of the lucrative smelters. He avoided the fate of a rival oligarch who annoyed the Kremlin and ended up being transported to jail in Siberia for 10 years.

Refugee

Mr Abramovich (41) has been forced to tell his story because he is being sued for $4bn (€2.54bn) by his mentor Boris Berezovsky (62) a refugee in Britain, at the London Commercial Court.

The exile claims that Mr Abramovich became an enforcer-type figure for Vladimir Putin, passing on alleged threats of confiscation to pressure him into selling shares in former state assets cheaply. Mr Abramovich has retorted with a 53-page defence that accuses Mr Berezovsky and a Georgian oligarch of demanding huge sums for helping him to rise from obscurity.

The man from Georgia, Arkady "Badri" Patarkatsishvili, emerges as the key intermediary, passing messages between the former friends.

Mr Patarkatsishvili was offered $500m (€318.5m) by Mr Abramovich, the defence papers admit, for protecting him in the aluminium wars.

The Georgian was found dead in the bedroom of his country house in Leatherhead, Surrey, southern England, five months ago. Tests showed that he had advanced heart disease. He was 52.

Mr Abramovich launches his defence with an icy riposte to his old pal. Mr Berezovsky's signed particulars of claim state that the football boss was formerly his "trusted friend and close business associate".

Mr Abramovich is loath to accept that there was any trust. "Save that it is admitted that the defendant and Mr Berezovsky were friends, no admissions are made," he states.

Mr Abramovich's vast wealth is founded on the Siberian oil company Sibneft, which was privatised by President Yeltsin in 1995 in an auction that some experts suspect of having been rigged.

The Chelsea owner now admits paying Mr Berezovsky, then nicknamed "Godfather of the Kremlin" because of his influence over President Yeltsin, to secure the oil business.

The Chelsea owner's next target was the aluminium industry. After privatisation, smelter managers, metals traders and journalists were reported to have been killed as groups battled for control.

Mr Abramovich now admits that he owed his success to the late Georgian oligarch.

"Mr Patarkatsishvili did ... provide assistance to the defendant in the defendant's acquisition of assets in the Russian aluminium industry," he states. (© The Times, London)

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