Enter Primakov

Yeltsin dismissed Kirienko on August 23 and attempted to replace him with former prime minister Chernomyrdin, but the Duma, led by the Communists, would not endorse his appointment and started preparing impeachment proceedings against Yeltsin. Putin went on television on September 1 to deny rumors that the Kremlin was planning to use military force to resolve the political conflict.² Joining the fray, Berezovsky suggested in an interview with Ekho Moskvy that Yeltsin should resign if he was unsuccessful in getting a cabinet approved.³ “It is not easy to talk about these events of the autumn crisis of 1998,” Yeltsin wrote in his memoirs. “It’s hard because the situation changed practically every day and then every hour. Frankly, I don’t remember such tension in the entire Russian political history of the 1990’s, except for military coup attempts in 1991 and 1993.”⁴

The crisis had a negative impact on Yeltsin’s already deteriorating health. Lilia Shevtsova observed: “The leader who had made his mission Russia’s return to Europe and its transformation into a flourishing democratic state ended up a politician completely dependent on his Kremlin servants, stooping to primitive intrigue and manipulation to survive … As Yeltsin grew weaker physically, the ostensibly superpresidential system became obviously disabled, devolving into a half-hearted Impotent Omnipotence.”⁵

After days of intense discussions with advisors, Yeltsin settled on a compromise candidate, Russian Foreign Minister Evgeny Primakov. Sixty-eight-year-old Primakov was a longtime intelligence officer who had operated under cover as a journalist in the Middle East for many years. From 1992 to 1996, when he took over the Ministry of Foreign Affairs, Primakov had led the Foreign Intelligence Service, the SVR. A moderate conservative but hardly a democrat, Primakov was adept at negotiating and set about putting the country on the path to economic recovery. His assumption of the prime minister’s post was not welcomed by Berezovsky. As executive secretary of the CIS, Berezovsky presented a united front with Primakov in working to keep the member countries committed to their collective partnership in the wake of the financial crisis.⁶ But his relationship with Primakov had been sour since 1996, when Berezovsky and Glushkov engineered the new financial model for Aeroflot, and employees of the SVR, which Primakov had headed, lost a source of easy money.

Primakov’s support from the parliament empowered him to bring in his own cabinet members and to make decisions that did not depend on consulting with the presidential staff and the Family. This meant that Berezovsky, whose political influence stemmed largely from his connections with those in Yeltsin’s inner circle, saw his importance decline. According to Goldfarb: “The crowds at the [LogoVAZ] Club were gone. Its bar, with the stuffed crocodile in the corner, stood deserted.”⁷ Berezovsky’s situation was not helped by the fact that Jews were being scapegoated publicly for Russia’s economic woes, with Berezovsky often the focus. That said, the financial crisis did not have a large impact on Berezovsky’s fortune—Forbes claimed he was worth $3 billion at this time—because he did not own a bank and revenues from Sibneft, although diminished because of the drop in oil prices, were paid in dollars. In fact, because costs were in rubles, Sibneft benefited from the devaluation. But Berezovsky’s political currency was declining markedly.

Primakov’s relations with Putin, despite their common background in the intelligence services, did not get off to a good start. Putin says in First Person that Primakov criticized him for packing the FSB with his friends from St. Petersburg. So Putin brought his senior staff to meet with Primakov and try to win him over. According to Putin, Primakov apologized for his criticism.⁸ But Yeltsin’s daughter Tatiana later claimed that Primakov had actually gone to her father and tried to convince him to dismiss Putin because Putin was replacing experienced FSB officers with those who were less qualified.⁹

According to Iumashev, later that year Putin requested an urgent meeting to tell him that Primakov had asked him to have the FSB wiretap liberal opposition leader Grigory Yavlinsky, who Primakov said was a spy for the United States. Putin claimed that he had refused the request and would resign if Yeltsin overruled him, because it was unacceptable for the FSB to get involved in politics. He did not want a return to KGB tactics.¹⁰ It is hard to imagine that Iumashev took Putin’s words seriously. Yeltsin and his team did not appoint Putin to head the FSB because he had democratic scruples, but rather because they wanted the FSB on their side. And the more liberal members of the government, like Nemtsov, looked down on him. Nemtsov recalled his own impressions: “No one knew much about Putin then. He was so unremarkable that even my secretary had no reaction to him. Once he called my office and my secretary refused to connect him to me until he identified himself: ‘Putin, Vladimir Vladimirovich, director of the FSB.’ My secretary then told me: ‘Someone named Putin is on the line. He says he is head of the FSB. What should I do with him?’”¹¹

Two Alarming Murders

The Kremlin apparently did not expect the FSB to put a stop to—let alone solve—the murders and assassination attempts that were occurring in the country on an almost daily basis. Several of these attacks appeared to have political motives, and one in particular raised questions about Putin’s involvement. On August 20, 1998, Anatolii Levin-Utkin, deputy editor of a three-week-old newspaper, Iuridicheskii Peterburg segodnia (Legal St. Petersburg today), was beaten to death outside his apartment building. The paper had just published an article titled “Lt. Colonel Putin Became FSB Chief Unlawfully,” which was highly unfavorable to the new FSB chief.¹² Levin-Utkin was not the author of the article— it was signed under a pseudonym--but he had contributed reporting and research.

The article discussed Putin’s career in a derisive tone, pointing out that the only investment project Putin implemented during his career in Sobchak’s office was the construction of a Coca-Cola plant. More to the point, the author reminded readers of Putin’s “excessive gullibility” toward business when he granted gambling permits to casinos and of “irregularities” in the issuance of import-export licenses, which Putin later admitted were mistakes. But the author went further, mentioning rumors that Putin “sold out” Sobchak a few days before the 1996 St. Petersburg election after meeting with Sobchak’s competitor Vladimir Iakovlev. Now that Putin was FSB chief, the author asked, would he use his office to protect Sobchak, who was still in exile, from the corruption investigation that had been initiated not only by the FSB but also by Skuratov and the MVD? The article concluded with a claim that an FSB director was legally required to hold a rank of lieutenant-general or higher upon appointment, while Putin was only a lieutenant colonel.

With his new appointment being discussed widely in the media, the last thing Putin needed was to have his past scrutinized, especially the parts involving Sobchak. According to the newspaper’s editor, Aleksei Domnin, Putin’s “people” called the office after the piece appeared, expressing their anger.¹³ As with many other such cases, Levin-Utkin’s murder aroused little attention from Russia’s investigative organs, and those responsible were never brought to justice.

Three months later, on November 20, 1998, Galina Starovoitova—a prominent St. Petersburg parliamentarian, anticorruption crusader, and human rights activist—was brutally murdered. Starovoitova was an anthropologist, known for her scholarly work on ethnic groups, as well as for her advocacy on behalf of ethnic minorities.¹⁴ A candidate for governor of the Leningrad region, she had just arrived from Moscow when she was gunned down in the stairwell of her St. Petersburg apartment by two unidentified assailants. Her press secretary, Ruslan Linkov, who was with her at the time, was wounded but survived. Starovoitova’s murder not only caused a huge outcry in Russia and abroad; it created a furor in the Kremlin. Yeltsin was reportedly so upset when he heard about it that he was hospitalized the next day, and he recalled in his memoirs that “the news came like a stab to my heart.”¹⁵ MVD chief Sergei Stepashin immediately announced that the murder was “a case of honor for the FSB, MVD, and Procuracy,” and the three agencies formed a special investigative group to find the culprits.¹⁶ The investigation would continue for over twenty years, leading to the prosecution of several men connected with the Tambov crime group for carrying out the murder. But those who actually ordered the crime were never identified.

Starovoitova’s killing was a political murder; no one denied that. She had acquired plenty of enemies during the course of her career. But for Putin and the Kremlin it was a political murder with a political solution: blame the Communists, who dominated the State Duma and posed a threat to Yeltsin’s presidency. Yeltsin would later write that “the outbreak of Communist hysteria in late 1998 and early 1999 made it reasonable to surmise that some leftist extremists were involved in the murder.”¹⁷ Clear evidence that this was the Kremlin’s strategy in the aftermath of the murder emerged in May 2000 with the publication by Kommersant of a leaked document from the Presidential Administration titled “Reform of the Administration of the President of the Russian Federation.”¹⁸ One section in the document proposed a public commission of inquiry that “will gradually reveal the ‘communist trail’ in the murder of Ms. Starovoitova and continue to use it as part of a large-scale campaign of struggle against the Communist Party.” As an example, the document suggested promoting rumors that Gennadii Seleznev, the Communist speaker of the Duma, was connected to the murder, which would “sooner or later” make him more “compliant” in his dealings with the Presidential Administration.

Starovoitova had clashed openly with Seleznev and other Communists as she investigated their suspected illegalities and objected to their extremist comments.¹⁹ And, in an interview she gave shortly before her death, she said she knew Putin and that he was “a pretty reasonable guy.”²⁰ But her public actions had negative implications for Putin and his supporters. She was one of the few democrats to say that real reform in post-Soviet Russia required the government to be cleansed of both Communists and former KGB officers. Her efforts at introducing a law on lustration in 1992 and again in 1997 were unsuccessful, but she had not given up trying. She also was investigating corruption in St. Petersburg, which could have drawn attention to Putin’s financial malfeasance there. In short, her murder not only served the Kremlin’s goal of tarnishing the Communists by blaming them for the crime; it also rid Putin and the FSB of a troublesome political challenge.

Circumstantial evidence suggested FSB involvement. The two guns found at the scene of the crime were rare in the ordinary criminal world—they had silencers and required expertise to operate—so it was likely they came from the FSB. According to a top Russian private security expert: “Only operational or recently retired special services officers would be skilled in handling such weapons and have access to them.” Also pointing to FSB complicity was the fact that Starovoitova had made the decision to fly home from Moscow at the very last minute. Those who planned to kill her would have learned of her change of plans only through wiretapping and surveillance methods that the security services used.²¹ Coincidently, Cherkesov, newly appointed as Putin’s deputy at the FSB, was on the flight to St. Petersburg with Starovoitova that night and appeared at the crime scene when Starovoitova’s sister Olga went there to identify the body.²²

There were also strange inconsistencies in the story of Linkov, which gave rise to media speculation that he might have been an accomplice of the killers. Prosecutor General Skuratov even told reporters that Linkov had withheld “several things that could shed light on the case.”²³ Linkov was reportedly critically wounded by two bullets and stayed in the hospital for weeks. But after he was shot, he managed to make a call to police on his mobile phone and then knocked on the door of the couple across the hall, who let him in, only to watch him calling a friend at the media outlet Interfax. Why the assassins didn’t kill Linkov, the only witness to the crime, was never explained. He was treated at the Military Medical Academy hospital, under the care of Iurii Shevchenko, who had earlier cared for both Putin’s wife and Sobchak. (Shevchenko would be appointed Russian minister of health the next June.) According to Olga Starovoitova, one of Linkov’s first visitors at the hospital was Putin, who discussed the details of the crime with him. Linkov later told journalist Andrew Meier that he had been close to Putin for a long time, meeting him often.²⁴

In 2018, Boris Gruzd, the attorney for Starovoitova’s family observed: “After twenty years there is no longer material evidence in the case … Now those who ordered the crime will be identified only by the testimony of persons at the top of the hierarchy of the Tambov group. This is the only way to determine if members of the political leadership, or party or regional officials, were behind the murder.”²⁵ But such testimony has not been forthcoming. In April 2019, Vladimir Kumarin/Barsukov, erstwhile leader of the Tambov gang, who had been behind bars for a decade, was formally charged with being an accomplice to the Starovoitova murder. The indictment read: “Barsukov, learning of the desire of an unidentified person to stop the state and political activities of … Starovoitova, whose vigorous … activities caused deep dissatisfaction among her opponents and hatred among some of them, together with an unidentified person, decided to terminate her state and political activities by killing her.”²⁶

Kumarin has long denied that he had any role in the murder, and even Starovoitova’s family has considered his involvement unlikely. But whatever his role, the indictment made it clear that someone in a high political position ordered the murder and that politician was powerful enough to prevent disclosure of his identity. Even if Kumarin was an accomplice, he will doubtless keep silent about who enlisted him. As one commentator noted, he “fears this unidentified politician more than the state. Perhaps because this politician is the state?”²⁷

Taking Aim at the FSB

Starovoitova’s murder occurred just three days after an event that created a huge public relations problem for Putin and the FSB. On November 17, 1998, FSB Lt. Col. Alexander Litvinenko, who would be fatally poisoned in London eight years later, appeared at a press conference with five colleagues, four of whom wore masks, to announce that in December 1997 Litvinenko and a fellow officer, Aleksandr Gusak, had been requested by their boss to kill Boris Berezovsky. Litvinenko, age thirty-six, had worked since the late 1980s for the KGB and its successors in military counterintelligence, anticorruption, and counterterrorism, which included a stint in Chechnya. In 1997, he joined a special unit of the FSB known by the acronym URPO, which dealt with organized crime and sometimes employed extralegal violence. Litvinenko first met Berezovsky when he was part of the team investigating the attempted murder of Berezovsky in June 1994 and started moonlighting as his part-time security guard. Then, in March 1995, Litvinenko saved Berezovsky from arrest in connection with the Listev murder by flashing his FSB badge and his revolver in front of a group of policemen outside the LogoVAZ Club and telling them to back off until his fellow FSB officers arrived.²⁸ Later Berezovsky would say: “That Sasha was brave enough to help me without any regard for his own safety or position was a gesture that I deeply appreciated … We were not exactly friends at that stage, and we mixed in very different social circles, but, after these extraordinary events, we trusted one another.”²⁹

To show his gratitude, Berezovsky took Litvinenko with him on a trip to Switzerland and invited him to spend time at the LogoVAZ Club.³⁰ He also introduced Litvinenko to Korzhakov (with whom Berezovsky was still on good terms) and other top security officials. Litvinenko had decided that the corruption and illegal violence he was witnessing within the FSB had to be reported to the big bosses, but his information fell on deaf ears. Korzhakov recalled later that he had not been impressed by Litvinenko, whom he described as “unshaven, shaggy-haired, with worn, unpolished shoes,” and concluded, after asking around the FSB, that Litvinenko was making stories up.³¹

Litvinenko’s whistle-blowing reached new heights after he told Berezovsky in March 1998 about the order from his URPO bosses to kill the oligarch. Berezovsky reported the plot to then FSB chief Kovalev, who summoned Litvinenko and his colleagues to hear them out but ended up trying to persuade them, with warnings about the consequences, to drop their complaint. So Berezovsky approached Evgenii Savost’ianov, the first deputy chief of the Presidential Administration, and at Savost’ianov’s instigation, the military prosecutor’s office began an investigation. All those involved, including URPO chief Evgenii Khokholkov and Litvinenko, were put on temporary leave from the department.³²

Word of the alleged plot soon leaked out, although it did not have much resonance at the time. Then, in May 1998, Aleksandr Khinshtein, a journalist who had close contacts within the security services, published an article titled “Boris Abramovich, I Have Been Ordered to Kill You.”³³ In recounting the details of the case, Khinshtein questioned why Litvinenko waited for three months to inform Berezovsky and what the supposed purpose would have been in killing Berezovsky. Also, Litvinenko’s bosses knew that he was close to Berezovsky, so why would they ask him to do the job? In sum, Khinshtein wrote: “Even a layperson can see how many inconsistencies are contained in Litvinenko’s accusations. This is more like an attempt to settle scores with a demanding leader than a ‘fight for the truth.’” This would be the FSB’s argument going forward.

Having given his seal of approval to Putin’s FSB appointment, Berezovsky apparently anticipated that Putin would be more receptive to the allegations of Litvinenko than Kovalev had been. He thus arranged for Litvinenko to see Putin right after the latter assumed his new post in July 1998. Although Putin feigned interest in what Litvinenko told him, he did nothing more than place Litvinenko under surveillance, and in October the military prosecutor’s office closed the case. Unwilling to let the matter drop, Berezovsky decided that Putin needed a push. So he took the bold and ill-fated step of writing an open letter to Putin, which was published by Kommersant on November 13, 1998. In the letter, Berezovsky described the murder plot, naming those involved, and then went on to chide Putin: “I am astonished that no due assessment was given to the URPO bosses’ activity after your appointment as FSB director.” He noted that criminals were everywhere in the government bureaucracy, including the FSB, and ended his letter with a dramatic plea: “I am asking you to use your powers to restore constitutional order.”³⁴

Putin responded four days later, issuing a curt statement saying that the chief military prosecutor was in fact investigating the case, but, if Berezovsky’s allegations were found to be untrue, he would face charges for bearing false evidence against FSB officials.³⁵ That same day Litvinenko and his fellow FSB officers staged their sensational press conference, led by Litvinenko, who spoke about corruption in the FSB and the order to kill Berezovsky. Although Litvinenko made it clear that the order was given before Putin took over as FSB chief, he also told his audience: “I have made several attempts to get through to Vladimir Vladimirovich and present all these facts to him, but we did not have such an opportunity. We were simply denied access to him.”³⁶ Of course, Litvinenko had met with Putin, but apparently he and Berezovsky wanted to give Putin the opportunity to claim that his subordinates were acting without his knowledge.

Putin went on the warpath. He was not about to let the FSB’s reputation be publicly tarnished or his leadership abilities questioned, even indirectly. On November 18, Putin issued a lengthy statement, published by Kommersant, in which he stressed that his agency would not hesitate to fire any employee engaged in criminal activity and would inform the prosecutor’s office. But the allegations brought by Berezovsky, he said, were based on verbal statements of certain FSB officers who could be motivated by personal interests and ambitions. Furthermore, in going to the media with his claims, Berezovsky could be seen as pressuring those conducting the investigation. Putin repeated his earlier warning to Berezovsky about making false allegations and added that Kommersant might also be prosecuted for slander.³⁷ The next night, in a television interview, Putin ridiculed Litvinenko and his comrades for their amateurish press conference and noted that he had received a call from an ex-wife of one of them—who turned out to be Litvinenko’s former spouse—saying that her ex-husband was behind in his alimony payments. Putin also said that the men themselves had engaged in illegal operations.³⁸

In going public with the purported murder plot and supporting Litvinenko’s press conference, Berezovsky apparently did not anticipate the FSB chief’s angry reaction. Also, because Berezovsky was known as a schemer who exaggerated his own importance, many observers doubted the allegations. Khinshtein was particularly scathing in an article for Komsomol’skaia pravda: “Dr. Goebbels taught that the more monstrous the lie, the easier it is to believe. Boris Berezovsky clearly proved this.”³⁹

Putin seemed to be under little pressure to get to the bottom of Litvinenko’s claims, even from Yeltsin. Yeltsin reportedly summoned Putin to his dacha on November 20 to demand a resolution of the scandal, but the murder of Starovoitova that very evening soon overshadowed the issue. Putin, who considered Litvinenko and his fellow whistleblowers traitors, dismissed them from the FSB in December, and, although he had disbanded URPO, he replaced it with a new FSB unit that had the same unbridled powers.⁴⁰

In December, Putin had another meeting with Yeltsin, which he mentioned in an interview with Elena Tregubova later that month. Putin told Tregubova that the president “spoke very kindly to me, and I feel that I have his full support.” Yeltsin had even ordered a pay increase of 25 percent for FSB employees. But, Putin added, Yeltsin had made it clear he would not run for a third term, and the new president could choose his own person to run the FSB. With his future uncertain, it was evidently not in Putin’s interest to burn bridges with Berezovsky. When Tregubova asked him about the murder plot, Putin responded with uncharacteristic sympathy: “Personally, I cannot exclude that these people really frightened Boris Abramovich. He had been a target of assassination before. So it was only natural for him to think that another attempt was in the making.”⁴¹

Skuratov Gets Tough

The new year brought more trouble for Berezovsky. On January 19, 1999, Prosecutor General Skuratov began investigating him for embezzlement of Aeroflot funds.⁴² The next day, Khinshtein published a sensational piece claiming that the private security company Atoll, allegedly owned by Berezovsky, had “a warehouse of surveillance equipment that would do honor to any state’s security services.” And the equipment, Khinshtein wrote, had been used to spy on the president’s family.⁴³ In early February, officers from the prosecutor’s office and the FSB raided the offices of Sibneft and Atoll looking for eavesdropping equipment. Two days later, the headquarters of Aeroflot were searched. And the next week, Khinshtein, the obvious beneficiary of secret documents from Skuratov’s investigators and the FSB, reproduced transcripts of phone conversations between Berezovsky and Tatiana D’iachenko, as well as between Berezovsky and others, including ORT television commentor Sergei Dorenko, that had allegedly come from Atoll’s secret recordings. The conversations themselves did not reveal anything sensational, but, according to Khinshtein, the message was clear: “Atoll spied not only on opponents of the tycoon but also on his friends, for future necessity.”⁴⁴ For his part, Berezovsky denied that he had anything to do with Atoll and called the whole affair a provocation.⁴⁵

Skuratov had received an indirect assurance of support for his criminal probes from Primakov and must have been further encouraged when Primakov, announcing an amnesty program for thousands of Russian prisoners, noted pointedly that it would “open up places for those who will soon be imprisoned for economic crimes.”⁴⁶ Berezovsky even told David Hoffman that at some point he confronted Primakov with proof that Primakov had personally ordered the investigations.⁴⁷ Whatever Primakov’s role, Skuratov needed little encouragement in his pursuit of Berezovsky. As he made clear in his subsequent memoirs, he did not hold the oligarch in high regard: “Berezovsky is a man who revels in power. He is like a drug addict with a needle: money, connections, positions are just means to get the next dose of the drug.”⁴⁸

Like others in the government, Skuratov deeply resented Berezovsky’s friendship with Tatiana D’iachenko and Iumashev: “After meeting with Berezovsky, Tatiana would go directly to her father and present Berezovsky’s proposals. And Yeltsin would be impressed that his daughter had such valuable ideas and judgments.”⁴⁹ Some of Skuratov’s bad feelings against Berezovsky had doubtless been fueled by Korzhakov, who had backed Skuratov’s appointment as prosecutor general and worked with him in moving against Sobchak, among others. Also, Skuratov had opposed the Russian military’s 1996 retreat from Chechnya, which Berezovsky had backed, and he objected strongly to Berezovsky’s negotiations with Chechen separatists, because he thought they encouraged radical elements within the republic’s leadership.⁵⁰

Whatever motivated his decision to move against Berezovsky, Skuratov had a higher priority. While Berezovsky’s mounting legal problems preoccupied the Russian press, Skuratov was secretly pursuing a case with implications for the Kremlin that went far beyond the criminal pursuit of a renowned oligarch. During a televised meeting with Yeltsin in November 1998, Yeltsin had asked Skuratov: “What cases of corruption have you brought to the courts?”⁵¹ Little did Yeltsin know that Skuratov had been secretly collaborating with a Swiss prosecutor, Carla del Ponte, in an investigation of Mabetex, the Swiss company that had been involved with the Kremlin renovations. Del Ponte had visited Moscow in May 1998 and told Skuratov that she had documents showing that Mabetex, along with its sister company Mercata, had bribed top Kremlin officials, including Pavel Borodin, to win construction contracts and that the money had been laundered through Swiss banks. After subsequently receiving these documents from the Swiss ambassador to Moscow, Skuratov started a secret criminal investigation in October 1998.

The case was kept under tight wraps, with only Skuratov’s deputy and Primakov informed, until del Ponte ordered a search of Mabetex on January 25, 1999, and telephoned Skuratov the next day to tell him that thousands of incriminating documents had been discovered. Word somehow leaked to members of the Kremlin, prompting Nikolai Bordiuzha, who had replaced Iumashev in December 1998 as head of the Presidential Administration, to call Skuratov to his office on February 1. Colonel General Bordiuzha, a KGB veteran, had been chief of the Russian Border Guard before becoming head of the National Security Council in September 1998. Yeltsin later revealed that he appointed Bordiuzha to lead the Presidential Administration while remaining in his Security Council post at Iumashev’s suggestion. With the opposition to Yeltsin in the Duma preparing to go on the offensive, Iumashev felt that “the office of the president needed some force behind it, at least for show.”⁵²

On receiving the summons from Bordiuzha, Skuratov recalled, “I knew suddenly that something bad would happen.” And he was right. After inquiring about the Berezovsky case, Bordiuzha asked, “What about Mabetex?” When Skuratov replied that it was under investigation, Bordiuzha said: “I have a video. Let’s watch it together.”⁵³ The now infamous videotape, which had reportedly been made several months earlier and was given to Bordiuzha by Iumashev, featured a nude man, who appeared to be Skuratov, cavorting in bed with two prostitutes.⁵⁴

Now Skuratov understood: someone had listened to his January telephone call with del Ponte, and the Family was attempting to stop his investigation. Bordiuzha suggested that Skuratov resign “because of health reasons,” and Skuratov agreed, writing a letter of resignation to Yeltsin. But after checking himself into the Central Kremlin Hospital, where he stayed for a few weeks, Skuratov began to reconsider. Knowing he would have the support of the Federation Council, the upper chamber of the parliament, which would have the final say on his fate, he decided not to resign after all. The investigation of Mabetex continued. The first deputy prosecutor general, Iurii Chaika, reported in a secret communication to the Federation Council on March 10 that work on the Mabetex case was “intensifying” and had been transferred to his office’s Directorate for the Investigation of Especially Important Cases.⁵⁵

The Kremlin went into full battle mode, and late in the evening of March 16, 1999, the sex video aired on the state television channel RTR.⁵⁶ The next day, Skuratov appeared before the Federation Council and asked for the support of its members, who had already received copies of the scandalous tape. The vote was 142 to 6 for keeping him in office. On March 18, 1999, Skuratov had a meeting with Yeltsin, who was recuperating in the hospital from a bleeding ulcer. Primakov and Putin were also present. Putin had already paid two visits to Skuratov in an effort to persuade him to resign, at first commiserating with him, but then subtly threatening that Skuratov himself could come under investigation for shady financial dealings. Now it was Yeltsin’s turn, and he told Skuratov that the scandalous film would not again be shown publicly if he resigned from his post. “This was already elementary blackmail, frank and undisguised,” Skuratov later wrote. “I was silent and looked at the president, while out of the corner of my eye I noticed that Primakov and Putin were watching me with interest: Putin—harshly, with an unpleasant grin, Primakov—sympathetic.”⁵⁷

Yeltsin managed to pressure Skuratov to sign yet another letter of resignation, to be postdated April 5, the day before the Federation Council met again. If he did not agree to this, Skuratov feared, “drastic measures would have been taken against me, including physical elimination—either a hitman’s bullet or a huge truck loaded with bricks hitting my car. These methods had been mastered to perfection.” Although in Yeltsin’s presence Primakov advised Skuratov to accede to Yeltsin’s request, he approached Skuratov as the latter was about to drive away in his car and told him: “Iurii Ilyich, you know, I’ll leave soon as well. I can’t work here anymore.”⁵⁸

Clearly, Yeltsin and the Family—which now included Putin as a provisional member—considered Skuratov’s probe to be a grave threat. As they had learned, del Ponte told Skuratov that credit cards belonging to Yeltsin and his two daughters were issued through the Banca del Gottardo and paid for by none other than Behgjet Pacolli, the head of Mabetex. According to del Ponte, “The president almost never used his cards, but his daughters used them a lot.”⁵⁹ Skuratov was also investigating Leonid D’iachenko, Tatiana’s former husband. According to Skuratov, D’iachenko and Tatiana had pressured Yeltsin to help Berezovsky and Roman Abramovich get control of Sibneft. D’iachenko then became a trader of Sibneft oil and got very rich, hiding his fortune in the Cayman Islands.⁶⁰

Skuratov defiantly continued his investigations of Mabetex, hosting del Ponte in Moscow on March 23, so they could discuss new details of Swiss bank accounts held secretly by Russian officials, just as Skuratov’s men were conducting searches of Borodin’s office.⁶¹ As for the sex video, instead of causing the intended outrage in the parliament, it aroused sympathy for the beleaguered prosecutor and anger at Yeltsin for his hypocrisy. Skuratov’s ally Korzhakov told Moskovskii komsomolets: “If they don’t leave Skuratov alone, I’ll tell everything: how Yeltsin’s secretaries ran out of his office with lipstick smudged over their faces; who was given apartments from us and why; where I took Boris Nikolaevich in a Volga with blacked out windows …”⁶² Emboldened, Skuratov announced in an April 1 interview on NTV that he had requested Yeltsin to investigate information from del Ponte about numerous Russians, some “very well known,” who were using Swiss banks to hide dirty money.⁶³

Not surprisingly, the Family fought back. On April 2, 1999, Putin appeared on television with MVD chief Stepashin to declare that a careful examination had verified that the man in the scandalous videotape was in fact Skuratov. (They did not say who had made the video.) Furthermore, the two men added, the prostitutes in the video had contacted their agencies and reported that they had been paid by people who were under investigation by the Prosecutor General’s Office as bribes to Skuratov. That same day, Yeltsin announced that Skuratov had been “suspended” because he was under criminal investigation for “abuse of office,” allegedly accepting the services of prostitutes as bribes.⁶⁴ But Skuratov could not be forced to leave his office until the Federation Council affirmed his dismissal.

Skuratov later wrote that he experienced a shock to see Putin playing a role in the fabrication of the case against him: “He knew full well that I had not violated the law and that the Mabetex case really existed.”⁶⁵ But, as former Putin advisor Andrei Illarionov suggested, Putin had additional motives for attempting to destroy Skuratov’s career: “For Putin himself, this was another step in a desperate struggle for his own survival. If Skuratov had remained in his post, following the Mabetex case, Skuratov would definitely return to the Sobchak case and, therefore, to the Putin case.”⁶⁶

More Travails for Berezovsky

Meanwhile, Berezovsky appeared to be under siege. Yeltsin had announced on March 4, 1999, that he was dismissing him from his position as executive secretary of the CIS for “exceeding his authority.”⁶⁷ Having a wealthy Jewish oligarch as an official member of his team was not something Yeltsin wanted to draw attention to, particularly after Russia’s financial meltdown. He had appointed Berezovsky to lead the CIS the year before because the other member states had pushed for his candidacy. “To this day,” Yeltsin later wrote, “the presidents of the commonwealth say that he was the strongest CIS executive secretary ever.”⁶⁸ But apparently the criminal investigations of Berezovsky and pressure from both Nikolai Bordiuzha and Primakov, whom Berezovsky had been criticizing publicly, persuaded Yeltsin that Berezovsky had to go.

A further blow to Berezovsky came on April 6, when Skuratov’s office issued a warrant for his arrest, along with Glushkov, on charges that they had stolen $250 million from Aeroflot by funneling it through the Swiss firm Andava.⁶⁹ Luckily for Berezovsky, the Family stood by him. Stepashin, asked by reporters on April 8 about the prosecutor’s orders to search for Berezovsky, who was in Paris at the time, declared: “Why do we have to search for him, he will come here on his own.”⁷⁰ Surprisingly, Berezovsky’s archenemy Chubais, no longer employed by the Kremlin but still enjoying considerable authority with the Yeltsin team, told the press on April 12 that “the excessive activities of the Office of the Prosecutor General regarding Berezovsky have been a deliberate political move,” adding that Skuratov should resign.⁷¹ When Berezovsky returned to Moscow on April 14, the warrant against him had been miraculously revoked.

By this time Berezovsky had an important ally—Aleksandr Voloshin, who had replaced Bordiuzha as head of the Presidential Administration in mid-March 1999. (Bordiuzha was reportedly fired—and removed as secretary of the National Security Council—because his confrontation with Skuratov had not produced the desired results.) Voloshin, a 1978 graduate of the Moscow Institute of Transport Engineers, had met Berezovsky when he worked as a civil servant providing information to automobile exporters. He became an asset manager for Berezovsky in the early 1990s and continued to assist Berezovsky with numerous business ventures after establishing a financial consulting firm in 1995. According to journalist Oleg Lur’e: “After getting close to Berezovsky, the career of the former engineer’s assistant took off like a supersonic jet.”⁷² Considered a “liberal technocrat,” Voloshin got a job, on Berezovsky’s recommendation, as Iumashev’s assistant in the Presidential Administration in late 1997, and the next year was appointed deputy chief of the PA for economic policy.⁷³

As Yeltsin’s new chief of staff, Voloshin clashed continually with Berezovsky’s nemesis Primakov and, according to media reports, wrote daily memorandums to Yeltsin criticizing the prime minister’s handling of economic matters. When the Federation Council again refused to approve Skuratov’s resignation on April 21, Voloshin was dispatched to speak to the senators in order to persuade them otherwise. His speech was a disaster, and he left the building without even waiting for the vote. Nonetheless, Skuratov, after being officially fired by Yeltsin the next day, allowed his duties to be assumed by his first deputy, Iurii Chaika. The Federation Council would finally approve Skuratov’s dismissal in August 1999.⁷⁴

In publicly discrediting Skuratov, Putin had helped Berezovsky, along with other members of the Yeltsin clan. And Berezovsky was grateful. In fact, Putin had extended an olive branch to the oligarch by showing up unexpectedly at a birthday party for Elena Gorbunova on February 22. Berezovsky recalled Putin’s gesture a year later: “It was my wife’s birthday, and I decided not to invite any of my acquaintances from the top echelons in order not to put them in an awkward position. To my surprise Putin came to that birthday party. Before that, he had never attended any such birthday parties—neither my wife’s nor my own. So he came and said ‘I don’t care at all what Primakov may think about me. I am here because I think it is right.’”⁷⁵

Did Berezovsky not suspect that Putin’s gesture had a motive? The Family had decided that they needed Berezovsky on board with them in the impending struggle over Yeltsin’s succession. Yeltsin was hanging on to power by a thread. If the Family allowed Berezovsky to be pursued by prosecutors, Yeltsin would lose a powerful advocate, who controlled key media outlets, including ORT and the newspapers Kommersant and Nezavisimaia gazeta. As for Berezovsky, his financial and political interests, like those of other oligarchs, would be irrevocably damaged if Primakov and the Communists managed to wrest power from the Yeltsin camp. As one observer put it: “Berezovsky had succeeded in combining his own interests so closely with those of the Yeltsin family that it would have been impossible to disentangle his personal fate from the political fortunes of the president. Like it or not, Yeltsin had become the protector of the oligarch from the arm of the law.”⁷⁶

According to both Masha Gessen and Alex Goldfarb, Berezovsky began to meet privately with Putin around this time. Gessen says that they saw each almost daily to discuss strategies against Primakov and, later, the question of Yeltsin’s successor.⁷⁷ Goldfarb describes one meeting, held in mid-April 1999 outside a disused elevator shaft at the back of Putin’s office for maximum privacy. Primakov had to go, the two men agreed. But who should take his place and eventually become president? After discussing two possible candidates for prime minister, Stepashin and Nikolai Aksenenko, minister of railways, Berezovsky asked Putin if he would consider becoming Yeltsin’s heir apparent. Putin quickly dismissed the idea, saying, incredibly, that he what he really wanted was “to be Berezovsky.”⁷⁸

Khinshtein considered Goldfarb’s story, which came from Berezovsky, completely implausible: “The director of the most powerful security agency afraid that he could be overheard and so conducting secret negotiations in this sealed-off area … And Putin admitting that he dreamed of being Berezovsky?”⁷⁹ He was right to be skeptical, given Berezovsky’s proclivity to exaggerate his influence in Kremlin circles. In fact, Berezovsky’s hubris may well have prevented him from realizing that Putin did not have a high opinion of him. Interestingly, Liudmila Putina told her German friend Irene Pietsch that Berezovsky was “enemy number one,” because he was “born under the star of David.” On another occasion, she remarked that Berezovsky was to blame for many of Yeltsin’s unwise decisions and, to Pietsch’s discomfort, again brought up his Jewish heritage, adding: “I don’t understand how Tatiana [D’iachenko] can get on so well with Berezovsky! She’s such a smart, sober-minded woman. Besides, she’s a Capricorn.”⁸⁰ Did Putin share his wife’s views of Berezovsky? Whatever the nature of the alliance between him and Berezovsky at this point, it would soon begin to unravel.