Daimler Bribery Case Tests Medvedev's Mettle

As prosecutors keep mum on whether they will open an investigation into government officials who accepted nearly $7 million in bribes fr om German car giant Daimler, President Dmitry Medvedev faces a test on just how determined he is to fight corruption.

Daimler acknowledged to the U.S. Justice Department on April 1 that its Russian division had paid kickbacks to government officials from 2000 to 2005.

Daimler's decision to admit to paying bribes in Russia and 21 other countries and pay a fine helped settle a lawsuit filed against it by the Justice Department on March 25. Court papers filed in the lawsuit did not identify the officials accused of accepting bribes.

While Russian newspapers had a heyday with the corruption case, Russian investigators' silence and apparent lack of interest toward following through with an inquiry of their own has vexed some Russians.

"The prosecutor has the right to order a criminal investigation based on media publications," Alexei Navalny, a prominent blogger and minority shareholders rights activist, wrote on his blog. "But, perhaps, our prosecutors don't read the newspapers. … I propose to help these guys and send them some letters."

Navalny kicked off an Internet campaign to inundate prosecutors with requests to open an investigation last week and, by Monday, about 1,000 letters had been submitted to the Prosecutor General's Office, Medvedev and the Interior Ministry, Navalny said by telephone, basing his estimate on the number of people who had notified him through his blog that they had written to the authorities.

"Right now they surely have the information," he said. "The only excuse they have left that it is taking another couple of days to give it to the Investigative Committee."

He said the silence from investigators suggested that they did not know what to do and were waiting for guidance from the Kremlin.

"They cannot investigate, and they cannot not investigate," he said. "It's a spectacular scandal, the whole country is telling them, 'Investigate,' and they are waiting for a political decision."

A spokeswoman for the Prosecutor General's Office told The Moscow Times last Wednesday that no investigation had been opened because the office "has not received any information regarding Daimler."

She could not say what kind of information was needed to open an investigation and wh ere it would have to come from.

When subsequently contacted by phone, representatives from the prosecutor's office and Investigative Committee declined to comment on what action they might take.

The hesitance could stem from a deep-rooted fear of exposing something that people are not supposed to know about, or from knowledge of specific names of government officials who were implicated in the case but cannot be made public, said Yelena Panfilova, head of Transparency International in Russia.

"There are no objective reasons keeping them from investigating," she said, noting that Russia has signed the United Nations Convention Against Corruption, which leaves no legal barriers for information exchange.

Several State Duma deputies have also sent letters to Prosecutor General Yury Chaika asking that prosecutors look into the Daimler case.

"From my experience, they don't ignore such requests. But it depends on the investigators and their attitude," said Ilya Ponomaryov, a Just Russia deputy who asked Chaika to look into the corruption claims and announce prosecutors' official position regarding the incident to the media.

Ponomaryov said that if Chaika refused to open an investigation, pressure could be brought on his office by the courts.

According to the U.S. Justice Department, Daimler paid 5 million euros ($6.8 million) in "improper payments" in connection with car sales to the Russian government, including 3 million euros directly to government officials in the Interior Ministry, the Federal Guard Service's Special Purpose Garage, the Russian military and the cities of Moscow, Novy Urengoi and Ufa. The largest sums went to the Interior Ministry and the Special Purpose Garage, including nearly 1 million euros deposited directly into a Deutsche Bank account belonging to someone at the Special Purpose Garage identified only as a "government official."

The Justice Department has no legal obligation to publicize names and other details because Daimler agreed to the settlement, Panfilova said.

"In theory, interest groups in the U.S. could request the details through the Freedom of Information Act, but it's possible that officials are not listed in the department's documents by their names," she said.

The affair, however, offers Medvedev an opportunity to improve his image and bolster his high-profile campaign to fight corruption, Panfilova said.

"This would be a much more effective gesture than all the committees and anti-corruption national plans combined," she said.

"All the investigative work has already been done," Panfilova said of the Daimler case. "One word from the president would be enough to open an official investigation."

Medvedev was traveling to the United States for a nuclear disarmament summit on Monday, and officials at his press office were not available for immediate comment.

Medvedev, who chairs a presidential council tasked with stamping out corruption, has made the issue a hallmark of his two-year presidency. As part of that effort he has ordered top government officials and their families to declare their annual incomes —? although not the sources of their money. Income declarations released on Monday showed that Prime Minister Vladimir Putin earned more than Medvedev last year.

Medvedev occasionally weighs in on especially notorious corruption cases, most recently ordering Interior Minister Rashid Nurgaliyev to oversee an investigation into a deadly car crash in Moscow that involved a LUKoil vice president and resulted in the death of two women.

Medvedev most recently met with his Anti-Corruption Council last Tuesday, and he demanded that officials take more initiative in opening corruption investigations based on media reports. “I submit to people sitting here not to wait for me to call and say, 'There is such and such information, check it.' You have to do it yourself,” he said, adding that he “is not able to handle everything.”