Brother ltd. How a Representative of a Top Chechen Leader ‘Solved’ Russian Business Disputes — And Walked Away With Millions

The Chechen Republic is one of Russia’s poor­est regions, its bud­get sup­port­ed large­ly by assis­tance from the cen­tral gov­ern­ment. But the republic’s pow­er bro­kers don’t hes­i­tate to flaunt their wealth. Ramzan Kadyrov, Chechnya’s long­time Moscow-backed leader, loves thor­ough­bred hors­es and exot­ic ani­mals and invites Hollywood stars to his birth­day par­ties. His daugh­ter host­ed a fash­ion show in Paris. And until he was banned from the site, he used to fill his Instagram page with shots of him­self in expen­sive cars and lux­u­ri­ous interiors.

Kadyrov says that his mon­ey comes from God. But Chechen elites also have more world­ly sources of income. Reporters from The Project, an inde­pen­dent Russian pub­li­ca­tion and OCCRP part­ner, have cat­a­logued mul­ti­ple busi­ness dis­putes in which a lit­tle-known Russian busi­ness­man, Pavel Krotov, has stepped in to bro­ker a res­o­lu­tion — only to end up with a con­sid­er­able por­tion of the assets.

In each lucra­tive case, sources say, Krotov was rep­re­sent­ing the inter­ests of Adam Delimkhanov, a mem­ber of the Russian par­lia­ment and among the most pow­er­ful politi­cians in the Chechen Republic after Kadyrov himself.

The con­tours of sev­er­al of these sto­ries have been report­ed sep­a­rate­ly. But emails sent and received by Krotov and obtained by reporters, as well as new inter­views with inside sources and cor­po­rate and prop­er­ty records, show that his involve­ment in each of these dis­putes was part of a larg­er pattern.

An authen­ti­cat­ed police doc­u­ment  appears to con­firm what mul­ti­ple sources are too afraid to say on the record: Krotov’s meth­ods includ­ed strong-arm­ing the oppos­ing par­ties. While inves­ti­gat­ing a for­mal com­plaint against Krotov, police not­ed that the busi­ness­men used “unjus­ti­fied crim­i­nal-law meth­ods of influ­ence.” In inter­views, half a dozen sources told reporters that Krotov had a pat­tern of invok­ing his con­nec­tions to Delimkhanov, which is why they feared for their safe­ty and refused to let reporters use their names.

Nor did any of the main par­ties to the busi­ness con­flicts described in this sto­ry agree to speak to reporters on the record. A major­i­ty of those who were con­tact­ed refused to speak under any circumstances.

Krotov him­self denies any ties to the Chechen politi­cians, dis­miss­ing reporters’ ques­tions as “pure nonsense.”

“I’ve nev­er been any kind of nego­tia­tor, ” he said. “I do busi­ness. I work to cre­ate.” Krotov said that all his invest­ments were made with his own mon­ey and that he does not know Kadyrov or Delimkhanov. “As an Orthodox Christian Russian per­son, I def­i­nite­ly don’t work for any Chechen elites, ” he said. He also denied many spe­cif­ic claims in the cas­es where he alleged­ly resolved disputes.

Representatives of Delimkhanov and Kadyrov did not respond to requests for comment.

“Closer Than a Brother”

Ramzan Kadyrov has been gen­er­ous in his praise of Adam Delimkhanov. In fact, Kadyrov once referred to the leg­is­la­tor as his suc­ces­sor. “I’ve pre­pared a per­son who can replace me, ” he told an inter­view­er in 2009. “Adam Delimkhanov. My clos­est friend. Closer than a brother.”

In the 1990s, Delimkhanov report­ed­ly worked as a dri­ver for Salman Raduev, a noto­ri­ous Chechen ter­ror­ist who took hun­dreds of civil­ians hostage dur­ing the first Chechen war. But Delimkhanov switched sides in 1999, tak­ing part in oper­a­tions against Chechen mil­i­tants and even sur­viv­ing an assas­si­na­tion attempt.

In the 2000s he served in Chechnya’s inte­ri­or min­istry, even­tu­al­ly becom­ing the republic’s first deputy prime min­is­ter in charge of secu­ri­ty issues. In 2007, he was elect­ed to the State Duma, the low­er house of the Russian parliament.

Delimkhanov’s vio­lent side is well-known in Russia’s par­lia­ment. In one inci­dent, after a dis­agree­ment with a fel­low leg­is­la­tor about Chechnya, Delimkhanov punched him in the head, set­ting off a strug­gle dur­ing which he acci­den­tal­ly dropped a gold-plat­ed pistol.

The Russian media has linked Delimkhanov to sev­er­al killings of Kadyrov’s ene­mies, though he has nev­er been charged with mur­der in Russia. In 2009, Dubai author­i­ties accused him of mur­der­ing a for­mer Chechen gen­er­al. Delimkhanov, a mem­ber of par­lia­ment, was on Interpol’s want­ed list for sev­er­al years. He has denied all these charges.

In 2014, he was sanc­tioned by the United States for con­nec­tions with the Brothers’ Circle, a region­al orga­nized crim­i­nal group.

Collecting a Debt

The first known episode in which Pavel Krotov appeared to act on Delimkhanov’s behalf arose in 2010.

Filaret Galchev, the bil­lion­aire own­er of Eurocement Group, Russia’s largest cement pro­duc­er, was in a tough spot. In 2007, Galchev had bought out a partner’s minor­i­ty share of the busi­ness for $1 bil­lion, agree­ing to pay annu­al install­ments of $200 million.

But, hav­ing made the first two pay­ments on time, he missed the third. Galchev’s for­mer part­ner first took him to court, then grew tired of wait­ing and sold the remain­der of his debt at a dis­count. The right to demand pay­ment from Galchev for the remain­ing sum of $600 mil­lion was pur­chased by Krotov, a busi­ness­man who at the time was reg­is­tered only as the CEO or co-own­er of small­er com­pa­nies with no major assets.

Once Krotov got involved, Galchev found a way to pay his debt almost immediately.

At the time, cit­ing unnamed sources, the Russian busi­ness media report­ed that Krotov was a rep­re­sen­ta­tive of Delimkhanov, with few fur­ther details.

Now, evi­dence new­ly obtained by The Project con­firms this ear­li­er report­ing, link­ing Krotov with Russia’s most pow­er­ful Chechens.

“A Few False Entrances”

Four peo­ple who have had busi­ness rela­tions with Krotov con­firmed to reporters that he was a rep­re­sen­ta­tive of Delimkhanov. None allowed reporters to use their names, cit­ing safe­ty concerns.

Two spe­cial­ists — Alexei Shlyapuzhnikov, a secu­ri­ty con­sul­tant for Transparency International, and a mem­ber of OCCRP’s tech­nol­o­gy team — exam­ined the emails used in this sto­ry and said they appeared to be authen­tic, although their dig­i­tal sig­na­tures were either miss­ing or out­dat­ed, so their ori­gin could not be defin­i­tive­ly confirmed.

Reporters also obtained thou­sands of pri­vate emails sent and received by Krotov  . The emails show that his inter­locu­tors under­stood him to be act­ing on behalf of Delimkhanov.

They also show that Krotov had ties to Kadyrov. In the late 2000s, he was involved in the man­age­ment of the con­struc­tion of the politician’s res­i­dence. The cor­re­spon­dence dis­cussed such details as the building’s bud­get, its design, and its secu­ri­ty features.

In the cor­re­spon­dence, Krotov receives rec­om­men­da­tions from a con­trac­tor on how best to secure the Chechen leader’s com­pound: “it is bet­ter to bring the bunker out beyond the perime­ter of the build­ing and con­nect them with under­ground pas­sages. Ideally, none of the staff should know where the entrance to the bunker is locat­ed. Maybe it’s worth orga­niz­ing a few false entrances, ” the attach­ment to one email reads.

“From the point of view of safe­ty, ” it con­tin­ues, “it’s bad to place the President’s apart­ments above the admin­is­tra­tive spaces, since it is the­o­ret­i­cal­ly pos­si­ble to bring an explo­sive device in there.”

One of the peo­ple involved in the con­struc­tion work also told reporters that Krotov was “work­ing for Delimkhanov.”

Closing a Case

In response to reporters’ ques­tions about the Galchev affair, Krotov said that the deal took place strict­ly with­in the law and that “nobody beat any­thing out of anybody.”

A few years lat­er, Krotov appeared in anoth­er legal dispute.

This one also involved a local­ly influ­en­tial fig­ure: Yakov Rovner (also known as Yan Rovner), a major land own­er, prop­er­ty devel­op­er, and “hon­ored cit­i­zen” of Kotelniki, a small town just out­side Moscow.

In 2011, Rovner got into a con­fronta­tion with the Moscow gov­ern­ment over a plot of land not far from the city’s ring road. The capital’s new may­or, Sergei Sobyanin, had launched a pro­gram to build trans­port hubs, and one of these com­plex­es was sup­posed to appear on Rovner’s land. But the busi­ness­man and the Moscow gov­ern­ment could not agree on the specifics of the project, lead­ing to a series of court cases.

Rovner had pow­er­ful con­nec­tions: The wife and son of the deputy head of the Moscow depart­ment of the FSB, Russia’s secu­ri­ty agency, were report­ed­ly among the share­hold­ers and man­agers of his companies.

Nevertheless, in short order, a crim­i­nal case was launched against the busi­ness­man for fraud and oth­er crimes. Rovner left the coun­try and was declared want­ed by the Russian authorities.

Rovner’s prob­lems were solved a few years lat­er — after Krotov became his busi­ness partner.

First a Seychelles-based firm called PVK Investments — which, accord­ing to Krotov’s emails, appears to belong to him — took par­tial own­er­ship of the cor­po­rate struc­ture that owned the dis­put­ed prop­er­ty. In the sum­mer of 2014, the plot of land was sold to anoth­er devel­op­er, who reached an agree­ment with the city.

In an email addressed to Krotov and sev­er­al oth­ers, Rovner makes the stakes of the arrange­ment clear. “I remind you that the sub­ject of our deal, a com­mit­ment from your side, was, with­in 3–7 days of the deal, to remove [me from the] Interpol [list] and then to close the [crim­i­nal] case.”

Though Rovner was frus­trat­ed by how long it took — “TODAY this has not HAPPENED!!! , ” he writes — in the end, the charges against him were dropped.

The cor­re­spon­dence makes clear that, while dis­cussing the deal that would get him out of his predica­ment, Rovner under­stood Krotov to be rep­re­sent­ing some­one more powerful.

“Pasha [Pavel Krotov] doesn’t decide any­thing … All ques­tions should be resolved direct­ly with Adam, who will give Pasha instruc­tions. Whoever Adam says to work with, we will, ” Rovner wrote in one email, appear­ing to refer to Delimkhanov. In anoth­er, impa­tient with slow progress, Rovner demands a con­ver­sa­tion with “A, ” describ­ing him as his “part­ner” and a “[Duma] deputy.”

Krotov would not com­ment on the case or on his ties to Rovner.

Returning a Share

Soon after­wards, Krotov appeared in a sto­ry that start­ed in Central Asia.

In 2014, Kazakhstani bil­lion­aire Kenes Rakishev, the son-in-law of the country’s for­mer prime min­is­ter, acquired an ini­tial stake in BTA Bank from the government.

BTA is a lender with a rich his­to­ry. In the 2000s it belonged to anoth­er Kazakhstani bil­lion­aire, Mukhtar Ablyazov, who lat­er feud­ed with then-President Nazarbayev, was accused of steal­ing from the bank, and fled the coun­try. The bank was tem­porar­i­ly nation­al­ized, and its new admin­is­tra­tion start­ed hunt­ing around the world for its lost billions.

Over the next few years, Rakishev grad­u­al­ly grew his share of BTA into a con­trol­ling stake and trans­formed the insti­tu­tion, shed­ding its bank­ing busi­ness. In effect, he turned BTA into an invest­ment com­pa­ny whose main assets were its claims against Ablyazov, esti­mat­ed at $6 billion.

A con­sid­er­able por­tion of the Ablyazov prop­er­ty that BTA was claim­ing is locat­ed in Russia, includ­ing plots of land, devel­op­ment projects, and a port. Even before Rakishev entered the pic­ture, a fierce bat­tle over the assets was under way.

Once Rakishev did get involved, Ablyazov’s own inves­ti­ga­tors found that he was work­ing with peo­ple close to Ramzan Kadyrov, includ­ing Krotov. An Ablyazov acquain­tance told reporters from The Project that Krotov played the role of some­one who “could kick your ass, if needed.”

The Ablyazov acquain­tance also said that the Chechens went on the attack, demand­ing that Ablyazov’s assets be trans­ferred to Rakishev.

Rakishev and Kadyrov have known each oth­er since the mid-2000s, and fre­quent­ly appear in pho­tographs together.

In a Facebook post, the Chechen leader heaped praise on Rakishev: “He helps our peo­ple a lot, he often vis­its me, always shares with me his joys and sor­rows. He’s well-known and respect­ed in Chechnya. The peo­ple call my BROTHER a prince.”

The Russian com­pa­ny reg­is­ter shows that at least one major BTA asset — Vitino, an oil port on the White Sea in Russia’s north — was indeed returned to Rakishev’s bank with Krotov’s involve­ment. In 2015, the port was acquired by Vitino Management Company, which is now par­tial­ly owned by BTA.

One of the two founders of Vitino Management Company was Dmitriy Shivkov. According to Krotov’s cor­re­spon­dence, Shivkov is the broth­er of his wife, Yana Shivkova, an actor who has per­formed dozens of small roles in Russian films and tele­vi­sion series, includ­ing Brigada, a cult hit about the crim­i­nal underworld.

Aside from the fam­i­ly con­nec­tion, emails show that Shivkov helps Krotov in his busi­ness deal­ings. Among oth­er things, he rep­re­sent­ed him in nego­ti­a­tions with Rovner, the Kotelniki landowner.

Krotov told reporters he nev­er worked for Kenes Rakishev, has no con­nec­tion to BTA Bank, and doesn’t even know where Vitino is.

Specialized Steel

In 2018, Russian busi­ness dai­ly Kommersant report­ed that Krotov had acquired two major indus­tri­al facil­i­ties: The Red October steel works in Volgograd, the country’s largest pro­duc­er of spe­cial­ized steel, and the his­toric Zlatoustovsky Electrometallurgical Plant in the Chelyabinsk region.

Here, too, the pre­vi­ous own­er of both facil­i­ties, Dmitriy Gerasimenko, had got­ten into trou­ble. Red October had gone bank­rupt and, he claimed in an inter­view, unknown oper­a­tives had attempt­ed a takeover. He tried to resist but was charged with fraud and fled the country.

The news­pa­per not­ed that Krotov was known to be con­nect­ed to both Kadyrov and Delimkhanov. The Project con­tact­ed sources involved in the affair, one of whom con­firmed the Kommersant story’s depic­tion, adding that Krotov had got­ten in touch, offered to help resolve the dis­pute, and end­ed up with the Zlatoust factory.

In the Russian com­pa­ny reg­istry, the ben­e­fi­cia­ry of the Zlatoust plant appears to be a proxy, since he is an unknown fig­ure who is also reg­is­tered as the founder and direc­tor of near­ly 200 oth­er com­pa­nies. But Krotov is list­ed as the facility’s pres­i­dent on its web­site, and in press releas­es he is referred to as its “con­trol­ling shareholder.”

Krotov denied act­ing as a nego­tia­tor on anyone’s behalf, telling reporters that he had sim­ply pur­chased the Zlatoust plant.

Methods of Influence

A for­mal com­plaint against Krotov and his asso­ciate alleges that he threat­ened peo­ple in yet anoth­er cor­po­rate conflict.

In 2015, both the Moscow and St. Petersburg-based law offices of Egorov Puginsky Afanasiev & Partners — a pres­ti­gious law firm one of whose founders was Putin’s class­mate in uni­ver­si­ty — report­ed­ly received some unpleas­ant visitors.

The firm was rep­re­sent­ing one side of a con­flict between two of the co-founders of Karat, a major fish­ing con­glom­er­ate. In 2003, one of the men, Alexander Tugushev, went into gov­ern­ment ser­vice and — depend­ing on dif­fer­ing ver­sions of the affair — either sold his por­tion of the hold­ing or turned it over to out­side man­age­ment. He was lat­er con­vict­ed of fraud and sen­tenced to sev­er­al years in prison. After his release, Tugushev demand­ed his share of the com­pa­ny back, spark­ing a mul­ti-year legal bat­tle with Vitaliy Orlov, anoth­er founder, whom the law firm was representing.

This doc­u­ment, an offi­cial request for the FSB to estab­lish sur­veil­lance on the case, was pub­lished anony­mous­ly on the inter­net. Reporters have con­firmed its authen­tic­i­ty with a police source.

According to a police doc­u­ment, Krotov vis­it­ed the law office on more than one occa­sion, demand­ing that Orlov return Tugushev’s shares.

One of Krotov’s asso­ciates on these vis­its was a man named Artem Begun, a busi­ness part­ner of Ilya Traber, a St. Petersburg busi­ness­man fre­quent­ly described as a pow­er­ful crim­i­nal boss with the nick­name “Antikvar.”

On one occa­sion, in an appar­ent threat, Begun men­tioned Adam Delimkhanov and “his peo­ple, who use machine guns when they solve prob­lems and remain unpunished.”

In the police doc­u­ment, inves­ti­ga­tors wrote: “As pres­sure on the appli­cant [Orlov], Begun A.A. and Krotov P.V. expressed their inten­tion to arrange for the appli­ca­tion of unjus­ti­fied crim­i­nal-law meth­ods of influ­ence against him with the use of high-rank­ing offi­cials and peo­ple close to crim­i­nal structures.”

Despite the efforts of Krotov and his force­ful asso­ciate, the con­flict between the two co-founders has yet to be resolved. It is now con­tin­u­ing in a London court. For his part, Krotov denies know­ing Tugushev and says he was not involved in the dispute.

A Successful Troubleshooter

It’s unknown how much Krotov has made from his rela­tion­ship with Delimkhanov and oth­er Chechen elites. But the busi­ness­man lives in style. “He’s friends with every­one, goes to the banya with every­one, ” says an acquain­tance, refer­ring to the Russian sauna, where pow­er bro­kers might dis­cuss mat­ters of impor­tance. “He dri­ves a Rolls-Royce and cre­ates a high sta­tus for himself.”

Krotov and his wife own a large prop­er­ty with a vil­la in the Rublevka, an area near Moscow where many Russian elites own lux­u­ry homes. Similar prop­er­ties in the same estate, Landshaft, are now sell­ing for over $8 million

An online adver­tise­ment for a used car for sale shows a Porsche Cayenne in front of Krotov’s house: “Infrequent and care­ful usage (the fam­i­ly has six auto­mo­biles), ” the ad reads.

Krotov and his wife also own an almost 300-square-meter apart­ment worth almost $3.5 mil­lion in Moscow and two apart­ments worth near­ly $3 mil­lion in Sunny Isles Beach, a city in Florida that has become pop­u­lar with wealthy Russians. Judging from his cor­re­spon­dence, he also has an apart­ment in Paris worth close to 6 mil­lion euros and anoth­er in Cannes, on the French Riviera, worth over 1 million.

Aside from wealth, it’s pos­si­ble that Krotov has also enjoyed some lev­el of diplo­mat­ic immu­ni­ty in his own coun­try. As recent­ly as last month, he was list­ed on the web­site of Grenada’s embassy in Moscow as the Caribbean country’s trade attache.

On the site, Krotov was described as a “spe­cial­ist with more than 25 years’ expe­ri­ence in the area of cor­po­rate deals, ” a “high­ly pro­duc­tive imple­menter with ver­i­fied expe­ri­ence reach­ing mutu­al­ly ben­e­fi­cial com­mer­cial deals, ” and a “strong com­mu­ni­ca­tor.” His pro­file was removed from the Grenadan Embassy’s site short­ly after reporters sent inquiries about his work there. The press office of the Russian Foreign Ministry said it had no record of Krotov being accred­it­ed as a trade attache.

In response to reporters’ inquiries, Krotov declined to dis­cuss his work for the gov­ern­ment of Grenada.

Original source of arti­cle: www.proekt.media/en