CIB

The Strange Tale of Pavel Borodin in Moscow…Geneva…and New York

Date: 01/05/2022

Author: Kent Moors, Ph.D.


Upon occasion during my decades of counterintelligence (CI) experience, I would not have to do the heavy lifting. Rather, I could just observe as some extraordinary events would pass by making my job a whole lot easier. This Spy Tale is one of them.

A decade after the fall of the Soviet Union, I was still watching Russians, now working for the SVR (the new version of the KGB’s First Chief Directorate and responsible for foreign espionage). However, on more than one occasion the new machinations coming from Moscow would find my operational portfolio extending into other areas.

Like this example from early 2001.

As post-Soviet change intensified so also was the board altering on which the power game was being played. More of this had to do with the surreptitious pilfering of Russian public money and its movement abroad. I had been tracking Russian money for years, especially when it involved KGB/SVR financing of foreign projects.

But it was becoming difficult by 2001 to tell the players without a score card while the amounts in question were getting larger. The rising sophistication of financing networks among organs of state security, government ministries, and newly created quasi “private” companies did not make the assignments any easier.

Enter one Pavel Borodin.

I had been following this story for a few months but, by the time we pick it up for this Spy Tale entry, Borodin was cooling his heels in a Brooklyn jail, awaiting extradition to Switzerland. His detention had provoked a nationwide outrage back in Russia.

To the overwhelming majority of his countrymen, the entire affair smacked of foreign governments deciding to charge a Russian citizen with having committed crimes in Russia when Russian domestic courts had not done so.

Pavel Borodin, 2017 Photo: tretyakovgallerymagzaine.com

From 1993, Borodin had been Kremlin director of public buildings for then Russian President Boris Yeltsin. Later (2000 until 2011 under Yeltsin’s successor Vladimir Putin), he was the administrative head overseeing a union between Russia and neighboring Belarus. More than ten years on, that merger has yet to happen. On the other hand, Moscow already has achieved whatever strategic advantage it would have obtained from the move anyway.

But back to 2001.

Borodin was arrested at JFK airport on a Swiss warrant issued through the international police organization Interpol. He said the ostensible reason for coming to the US was to attend George W. Bush’s inauguration, although there was another view as to why he was in the States. More on that a bit later.

Meanwhile, we hardly confused the uproar back home in Russia with any popular sentiment that the fellow was a saint. Public opinion polls run by a Moscow newspaper at the time revealed that over 80 percent of Muscovites condemned the US detention while about the same percentage believed Borodin’s hands were dirty.

The problem was this. Despite the Interpol warrant, Switzerland had yet to charge him with anything. This was the gravamen for the public campaign in Moscow. The Russian outrage had more to do with detaining fellow countrymen aboard without charge than it was springing a local version of Mother Teresa.

For that matter, the Swiss had not even listed the guy as a suspect, only as one wanted for questioning in a high-profile bribery case. After an investigation that had lasted two years, the Geneva investigating judge Daniel Devaud apparently needed Borodin to tell the Swiss what they should indict him for.

Despite being detained in a Brooklyn jail it seems one still cannot take the Fifth in Switzerland.

In another point of some interest making the rounds at the time is the curious fact that bribery to secure business contracts is not even a crime in Switzerland. That is one major reason why so many international holding companies of dubious parentage (then and now) are located there.

Anyway, I learned that the authorities in Geneva were looking into whether kickbacks were paid into Swiss bank accounts controlled by some well-connected Russian political folks. The money was supposed to have come from the Swiss-based company Mabetex.

Mabetex’s head office is in Lugano. This is the largest town in Ticino, the Italian speaking canton of the country, just north of Milan. While only having been set up in 1991, within one year it had landed some of the largest, most prestigious, and some would say most garish building projects immediately after the dissolution of the USSR in what were now the independent countries of Kazakhstan and Russia.

Those projects included renovating the Russian White House (the Parliament) after Yeltsin’s tanks destroyed the top five floors on October 4, 1993 (see my wife Marina’s vivid accounts in the three-part “A Time of Revolution in Moscow,” Classified Intelligence Brief, October 27, November 3, and November 10, 2021).

From out of nowhere, Mabetex just happened to receive contracts for billions of dollars’ worth of renovations on the Kremlin and other public buildings in Moscow. These contracts were under the control of Borodin and the Swiss froze bank accounts in his name and that of his wife well before the Interpol warrant had been issued.

In its brief history, the company had also been involved in payoffs that had required some review during the course of other operations in which I had been involved. One particularly memorable situation had Behgjet Pacolli, the company’s founder and president, feeling pressure in August 1999 about Mabetex credit cards issued to Yeltsin’s family.

This became the first link in a sequence of events that resulted in Borodin biding his time in a US jail cell as a service to the Swiss and making the connection is necessary to where this Spy Tale is headed.

Behgjet Pacolli Photo: The Mabetex Group

There is no indication that Boris ever used his card. However, his younger daughter, then named Tatiana Dyachenkova (but see below), had managed to run up more than $1 million in charges over a few days of shopping in Budapest during a trip there by the Yeltsin clan. Mabetex simply paid the bills.

Talk about “pin money.” Tatiana even required that stores remain open after hours in an almost continuous shopping spree. For several years, we had been watching her and her entourage looking for a way to turn somebody in the group. Usually, a weakness is employed in caressing an asset.

The problem was the pies these people had thumbs in were so large and involved a network so pervasive that we could never use it. To be useful in espionage, corruption had to be something the target wanted to keep secret from bosses, colleagues and in some cases spouses. In this case, the thefts and chicanery were so outlandish that everybody already knew (or were already incriminated.)

Those surrounding the president’s daughter had become a very powerful insiders group known in the Moscow press as merely “the family.” Newspapers would often refer to Tatiana as the “little tsarina” or “the darling of the Kremlin.” It sounded like derision because it was.

The daughter’s coterie – which included oligarchs Roman Abramovich and Boris Berezovksy (who later committed suicide) – pulled the president’s strings, probably made most of the decisions in his name as the president’s alcoholism became more acute, while lining their own pockets in the process.

Tatiana successfully had two prime ministers fired in three months, blackmailed one national top prosecutor while forcing his replacement into taking an early pension (at age 48) when both sniffed too close to shady deals, and was largely responsible for making her father the most unpopular Kremlin resident since Ivan the Terrible.

I only met her once, at an informal social gathering in Moscow. Had the distinct feeling of needing to shower directly after. Technically, she had the position as head of public relations for the president’s office. But in all the years she held the job, nobody in the Moscow press could recall having ever seen Tatiana at a single official press conference, briefing, or public function.

Nonetheless, she obviously had clout and knew where bodies were buried. Putin, perhaps out of personal caution than anything else, kept Tatiana as an advisor for more than a year after taking office, saw to it that her father was never charged with a crime, and ended up using her oligarchs for his own purposes.

Her husband at the time, Alexey Dyachenko, was a top honcho at the national airline Aeroflot and would later become CEO of Urals Energy (falling under investigation in 2008 by the Putin Administration). They divorced, Tatiana married fellow presidential advisor Valentin Yumashev in 2001, and then flew to London to have a baby. The last time I was still following her exploits (in early 2012), Tatiana, Valentin, and daughter Maria were apparently citizens of Austria.

Tatiana Yumasheva (formerly Dyachenkova, née Yeltsina), ca. 2019 Photo: asiaplustj.info

Oh yes, one other morsel. Until 2018, Valentin Yumashev was the father-in-law of another billionaire, Oleg Deripaska. Deripaska had been the husband of Yumashev’s daughter from a previous marriage and is the shadowy figure who paid Paul Manafort (at one point Donald Trump’s 2016 campaign manager) a $10 million contract for “consulting services.”

Here is where all of this apparently comes together (in case you were wondering). Mabetex received huge no bid contracts from Borodin’s office for massive renovations of public buildings in Moscow. All of these contracts were awarded after the Budapest credit card bills were paid.

In Switzerland, the money trail heated up. The Swiss federal prosecutor Carla del Ponte was preparing to leave her post and head up the UN War Crimes Tribunal. She had a vested interest in moving the case along quickly. At one point, del Ponte remarked that they had a room full of papers on “the Russians.”  The warrant from Judge Devaud that landed Borodin in an America jail was initiated soon after.

Meanwhile back in Moscow, the shady construction contracts were creating problems. Borodin remained in the center and certain parties (likely among them members of Tatiana’s “family”) were siphoning off a lot of money.

Yet as one Russian national TV commentator observed over drinks, “that does not give foreigners the right to determine which Russians are corrupt and which are not.” The actions in question occurred in Moscow, he went on to say, not Geneva. Seems it was the Russian version of “OK, he is crook, but he remains our crook.”

Of interest, despite expending exhaustive efforts to make life difficult for Russian media heads holed up in Spain fighting extradition back to Moscow or raiding Russian oil companies to see what their books said, the nation’s prosecutor general had not moved against Borodin. If the Kremlin end up not to indict him, the prevailing reasoning on the street was saying, why should anybody else?

And what of the inauguration? Well, Mr. Borodin watched the gala affair on TV from his jail cell. As a Moscow media friend wryly noted, “somebody should have told him that the festivities were being held in Washington not New York.”

So, if it was not for an inauguration, why did Borodin fly to the US in the first place? There may have been something else that drew his attention to the States. We had intel that he was really coming for talks with a certain San Francisco-based major construction company (with whom the Agency had a close business connection ever since it founded the concern during the early days of the Cold War).

The supposed discussions involved Borodin’s latest pet project, a $2 billion Russian government administrative complex in St. Petersburg he was now running (and one close to the heart of local boy Putin). We also wanted to see what that might provide for our interests.

The US connection to the St. Petersburg project never emerged. Borodin was subsequently released after he posted a 5 million Swiss franc bond. By 2002, his case was closed and the bond returned. The file is sealed and the Swiss are making no further comments on the entire affair.

If not knowing anything else, I would conclude somebody ended up with a “friend” in high places.

Nonetheless, Russians learned an important lesson from all of this. If you are ever invited by an American president to a party, better check with Interpol first.

Dr. Kent Moors


This is an installment of Classified Intelligence Brief, your guide to what’s really happening behind the headlines… and how to profit from it. Dr. Kent Moors served the United States for 30 years as one of the most highly decorated intelligence operatives alive today (including THREE Presidential commendations).

After moving through the inner circles of royalty, oligarchs, billionaires, and the uber-rich, he discovered some of the most important secrets regarding finance, geo-politics, and business. As a result, he built one of the most impressive rolodexes in the world. His insights and network of contacts took him from a Vietnam veteran to becoming one of the globe’s most sought after consultants, with clients including six of the largest energy companies and the United States government.

Now, Dr. Moors is sharing his proprietary research every week…knowledge filtered through his decades as an internationally recognized professor and scholar, intelligence operative, business consultant, investor, and geo-political “troubleshooter.” This publication is designed to give you an insider’s view of what is really happening on the geo-political stage.

You can sign up for FREE to Classified Intelligence Brief and begin receiving insights from Dr. Moors and his team immediately.

Just click here – https://classifiedintelligencebrief.com/

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