FBIS4-41687 "drsov124_a_94020"
FBIS-SOV-94-124 Daily Report 25 Jun 1994
RUSSIA INTERNATIONAL AFFAIRS

Latvian Government Implicated in Illegal Oil Exports

Latvian Government Implicated in Illegal Oil Exports PM2706105094 Moscow KOMSOMOLSKAYA PRAVDA in Russian 25 Jun 94 p 5 PM2706105094 Moscow KOMSOMOLSKAYA PRAVDA Russian BFN [Report by correspondent Karen Markaryan: "Criminal Oil Pipeline"] [Text] In the course of the investigation into the case of Ivan Kharitonov, one of the leaders of Latvia's criminal world, staffers involved in the struggle against organized crime uncovered the far from fictitious tentacles of the international mafia, which moves hundreds of thousands of tonnes of contraband petroleum products from Russia to the West. According to Latvian police estimates, Russia has lost as much as half a billion U.S. dolalrs in this way in the past 18 months. Latvia's losses resulting from illegal shipments of gasoline and diesel fuel through its territory are on a scale comparable to the republic's annual budget. One of the main intermediaries is the Swedish-Latvian firm TESS Petroleum. During an investigation of this joint venture, a criminal business plan was uncovered. The mechanism is brilliantly simple. For example, the chief of a Kaliningrad trawler fleet base or the leader of a certain enterprise in that oblast suddenly rejects petroleum products that are in transit, using any excuse you like, and asks that the goods be readdressed to TESS Petroleum in Riga or some other front firm. Meanwhile a firm in Tallinn belonging to the TESS conglomerate has already paid for the petroleum products on the Kaliningraders' behalf. An order then comes down the Lithuanian Railroad, and the cargo turns around in mid-journey and goes to Latvia, from where it is most convenient to send the oil onward to the West by way of well equipped terminals. Naturally, nobody pays any dues for this devious transit route. And all the time Kaliningrad Oblast is suffering a constant fuel shortage. The Latvian police alone do not have the resources for a detailed analysis of this "black-market bookkeeping." However, it is now quite clear that the roots should be sought in Moscow, at the highest government level. It was only from there that huge deliveries of petroleum products from various regions of Russia could have been organized and authorized. The staffers of the Latvian MVD [Ministry of Internal Affairs] directorate for combating organized crime approached their Russian colleagues and provided them with copies of bank documents in which various Russian figures appear. However, nobody from Moscow has turned up. "It seems our colleagues are simply afraid to take it on," a Latvian MVD staffer told me. "We know what a bombshell we have in our hands. And the criminals know it very well, too. I would not be surprised if they try to put a stop to the whole thing at the outset, and they will stop at nothing."