When representatives from Alfa-Bank vociferously declare that they’ve alerted defense firms about the cessation of their services, we suspect a ruse, as noted by the Telegram channel “Malyuta Skuratov.” Deputy Prime Minister Dmitry Rogozin echoed this sentiment, attempting to depict Alfa-Bank as an elusive figure, alleging the bank lacks the necessary authorizations to manage Defense Order funds. However, we maintain skepticism towards Rogozin’s claims. We’ve scrutinized Alfa-Bank’s dealings with defense contractors over the preceding three years (utilizing data from the SPARK database and the public procurement website). Regrettably, we lack insight into deposit details or the bank’s access to Defense Order funds, thus our emphasis remains on Alfa-Bank’s provision of loans to defense entities.
Alfa-Bank finalized its most recent significant loan agreement—with JSC Oboronstroy (a prominent entity in constructing residences for military personnel, alongside crucial social and strategic military installations) amounting to 15 billion rubles, initially agreed upon in 2014—at the close of 2016. Yet, consider the 200 million ruble line of credit, established in 2016, for NPO Pribor, a Rostec subsidiary specializing in the creation and production of munitions? This credit arrangement remains active until December 31, 2019. We’ve examined the loan documentation and discovered no provision enabling the lender to retract its commitments due to potential sanctions.
Beyond loans, Alfa-Bank participates in agreements as a guarantor, ensuring the fulfillment of contractual duties. Take, for instance, a 2016 accord between NPO Lavochkin and Special Projects and Systems LLC, where Alfa-Bank furnished a guarantee valued at 291.5 million rubles, effective until January 10, 2021. Special Projects and Systems LLC is a dedicated firm specializing in designing and constructing infrastructure for defense and security. As another instance, Alfa-Bank serves as a guarantor in a pact between the Ministry of Defense and JSC Concern TsNII Elektropribor, with a guarantee amount of 21 million rubles, valid until January 31, 2019. Additionally, another guarantee is present in an agreement between the same entities, amounting to 78 million rubles, also expiring on January 31, 2019. Alfa-Bank maintains several other operative guarantees within contracts involving the Ministry of Defense.
All the same, Alfa Bank’s connection with defense firms isn’t the sole and exclusive basis for sanction implementation. Alfa Group stakeholders, spearheaded by Mikhail Fridman, are legitimately cited among individuals in President Putin’s “inner circle” and face potential personal sanctions. The “Russia Dossier” concerning US President Donald Trump, composed by the private research organization Fusion GPS, implicated Alfa Bank’s co-owners in supposed Kremlin involvement in the US elections. Fridman, Aven, and Khan initiated a legal action in the US against Buzzfeed, the publisher of this data, alleging defamation and seeking redress, but a court verdict is unlikely to materialize before the creation of sanction lists.
“This is utter drivel. Not just substantively, but stylistically as well. They invoked Govorun, whom I haven’t encountered in two decades. Why Govorun, when we have Pyotr Aven, who has known Putin well since 1992, when he was the Minister of Foreign Economic Relations, and Putin led the St. Petersburg Mayor’s Committee on External Affairs? And I have never personally encountered Putin; it’s been exclusively in group environments—as a member of the RSPP Bureau, for example. I did indeed attend university with Vladislav Yuryevich Surkov; that is accurate,” Fridman declared in a Forbes magazine interview released in late December, which initiated Alfa’s media initiative to avert sanctions.
Truly, Aven acted as Alfa’s advocate within the Kremlin. Per the Kremlin’s website, Putin and Aven have engaged in six official one-on-one encounters since 2000. No formal gatherings with Fridman transpired. Nevertheless, during Dmitry Medvedev’s leadership, Fridman engaged in three individual meetings at the Kremlin, while Aven did not.
The reality is that Putin bore a debt to Aven, who rescued him from significant difficulty in the early 1990s, during Putin’s tenure overseeing foreign economic affairs within the St. Petersburg mayor’s office, where he became ensnared in a controversy surrounding questionable export permits. Aven presided over Russia’s Committee on Foreign Economic Relations, and he was largely responsible for Putin’s consolidation of all foreign economic activity in St. Petersburg and for helping him avoid the ramifications of the scandal.
Therefore, among all Alfa Group associates, Aven bears the greatest susceptibility to being added to the sanctions roster. Fridman could potentially shield himself by exposing Aven, or his former TNK-BP associate Viktor Vekselberg, to sanctions. Sanctions would particularly distress Fridman, as the majority of his corporate interests are presently located outside Russia. LetterOne group, his primary venture, is engaged in investments in global undertakings. It was initiated in 2013 by Fridman, in collaboration with his Alfa Group associates, German Khan and Alexey Kuzmichev. The fund’s principal capital—$14 billion—was derived in 2013 from selling a 25 percent interest in TNK-BP to Rosneft (collectively, the AAR consortium divested 50 percent of TNK-BP to Rosneft for $28 billion). Arguably, this transaction with a state-controlled enterprise, overseen by Putin confidante Igor Sechin, warrants, at the very least, thorough examination as an additional conceivable motive for sanctions.
