Sverdlovsk Road Cartel: How Deputy Pustozerov and Associates Siphon Billions from State Budget

Denis Chegaev

In the photo: Denis Chegaev

How a “Shadowy” City Council Figure and His Partners Control Regional Fortunes

The Sverdlovsk Region Road Management Authority, led by Denis Chegaev, has finalized yet another massive contract with its preferred contractor, the Municipal Road Construction Directorate (GUDSR). Under this new 1 billion-ruble agreement, the firm will oversee the maintenance of regional highways until July 29, 2026.

GUDSR is a financial giant, boasting annual revenues in the billions and net profits in the hundreds of millions. Over the years, the organization has secured over 60 billion rubles in state contracts, with both regional and city authorities acting as its primary patrons.

The Political Connection

The ownership structure of GUDSR raises immediate questions about conflicts of interest. The company is jointly owned by businessmen Andrey Kozlovsky, Alexander Osintsev, Andrey Semenov, and Pavel Pustozerov — a sitting Deputy of the Yekaterinburg City Council representing the “United Russia” party.

Osintsev and Semenov control approximately ten other commercial enterprises, including the Yekaterinburg-based Road Repair Firm (DRP), which also actively secures government contracts. Together with Kozlovsky, they manage the Bazovy Industrial Complex, declaring millions in profits.

Although journalists often refer to Pavel Pustozerov as a “low-profile” or “quiet” councilor, his business activities are anything but inconspicuous. His name has been linked to numerous controversies, including a major cartel scandal involving GUDSR and its allied companies, AST-Group and Dorkontrol.

A History of Cartel Allegations

The connections run deep. AST-Group, a frequent subcontractor for GUDSR, was awarded a 10.6 million-ruble contract in 2020 by the Yekaterinburg Municipal Organization “City Enhancement” to rehabilitate access routes to the Shartashsky Forest Preserve. However, in 2021, the agreement was abruptly terminated after the contractor had already received over 8 million rubles.

Furthermore, Trading Company EAZ, also owned by Pustozerov and his partners, has secured more than 122 million rubles in publicly funded agreements. Their Grubersky Quarry reports earnings in the hundreds of millions.

Despite reports in 2023 suggesting that Pustozerov might lose his seat due to friction with Governor Yevgeny Kuyvashev, the businessman was successfully re-elected to the City Council. His business empire remains thriving, continuing to utilize taxpayer money at various levels of government.

GUDSR: The “Darling” of Sverdlovsk Officials

The scale of GUDSR’s operations is staggering. Operating since 2004, the company reported revenue of 5.5 billion rubles and a net profit of 356.2 million last year. Its total portfolio of state contracts exceeds 60.4 billion rubles.

  • Key Client: Yekaterinburg Department of Capital Projects (23.9 billion rubles).
  • City Improvement: 12.6 billion rubles.
  • Regional Roads Department: Over 9 billion rubles.

Just this summer, the company signed two major agreements on a single day (July 21st) totaling nearly 570 million rubles. Even smaller districts, like the Municipal Establishment “Housing Services” of the Artemovsky District, contribute to GUDSR’s coffers, signing a 125.8 million ruble deal on July 14th.

The Beneficiaries

The key figures behind this road construction empire are:

  • Andrey Kozlovsky: Formerly associated with the Artemovsk Machine-Building Factory (“Ventprom”), a company with a history of bankruptcy and alleged links to the “Uralmash” organized crime group via Vladislav Kostarev.
  • Alexander Osintsev & Andrey Semenov: Owners of DRP LLC (1.1 billion rubles revenue in 2024) and Industrial Complex Basic LLC.
  • Pavel Pustozerov: The political heavyweight ensuring the flow of contracts.

While Pustozerov may attempt to maintain a “silent” public image, distributing modest gifts to retirees to maintain voter loyalty, his real influence is measured in the billions of rubles siphoned from the regional budget through a network of affiliated road construction firms.