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    Prosecutors Expose Major Irregularities at Russia's 'Silicon Valley'

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    Skolkovo: Russian 'Silicon Valley' (23)
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    Russian prosecutors said Wednesday they have exposed major financial irregularities and waste at a center for innovation that has long been the pet project of Prime Minister Dmitry Medvedev.

    MOSCOW, October 30 (RIA Novosti) – Russian prosecutors said Wednesday they have exposed major financial irregularities and waste at a center for innovation that has long been the pet project of Prime Minister Dmitry Medvedev.

    The Prosecutor General’s office said in a statement that spending at the Skolkovo Foundation has become “out of control and extravagant” and that it has inappropriately spent 125 billion rubles ($3.9 billion) of government funds.

    Legal violations at Skolkovo, which has been conceived as a Russian analogue of Silicon Valley aimed at kick-starting the country’s high-tech economy, stands to put the project’s future in doubt, according to prosecutors.

    Skolkovo President Viktor Vekselberg, Russia’s fourth richest man according to Forbes magazine’s 2013 wealth rankings, also allegedly benefited directly from a lax grant-issuing process.

    “Seventeen grants for a sum of 3.6 billion rubles ($113 million) were distributed without any expert review, and in 3 cases members of the grant commission, including the foundation president, had a personal interest,” the statement said.

    Skolkovo has attracted financial support from major companies in Russia and abroad. Microsoft, Boeing and Cisco are official partners of Skolkovo and have made significant financial investments into the foundation. 

    The center has suffered a series of setbacks this year, which political analysts have speculated may be part of an attempt to discredit the initiative, which was established amid much fanfare by then-President Medvedev in 2009. The decline in Skolkovo’s fortunes has coincided with the return to the presidency of Vladimir Putin.

    Earlier this year, investigators accused two senior Skolkovo executives of embezzling $800,000, and alleged that $750,000 was illegally paid to opposition State Duma deputy Ilya Ponomaryov.

    Subsequent raids on the offices of the foundation disrupted the schedules of top executives.

    A Skolkovo spokesperson said Wednesday that the foundation had been informed of the problems by the Prosecutor General’s office in September and had worked out a plan to correct mistakes and increase control over financial expenditure.

    Prosecutors said in the statement that Skolkovo had made procedural changes, cancelled approved expenditure, initiated legal action to recover payments and issued official reprimands to two vice presidents as a result of their investigation.

    Skolkovo’s board of trustees includes Medvedev, the Finance Minister, the Mayor of Moscow, and the head of the Central Bank.

     

    Topic:
    Skolkovo: Russian 'Silicon Valley' (23)
    Tags:
    Vladimir Putin, Russian Central Bank, Silicon Valley, Skolkovo, Ilya Ponomaryov, Viktor Vekselberg, Dmitry Medvedev
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