The head of the Economic Safety Department of the Ministry of Internal Affairs of Russia Lieutenant General of the Russian Militia Yuri Shalakov talks about the effects of the financial crisis on economic crimes committed in the country.

The economic safety department of the Ministry of Internal Affairs of Russia was established in 2005 by a decree of President Vladimir Putin during the restructuring of the Ministry of Interior Affairs.

Today, employees of the Economic Safety Departments are engaged in preventing, uncovering, and suppressing economic crimes affecting legitimate rights and interests of citizens and undermining the economic system of the state.

– Mr. Shalakov, during the crisis, considerable funds are allocated from the national budget to support the economy. Do your authorities track how this money is spent?

– Yes, we do track the funds, especially when their misuse implicates violations of criminal laws. We keep track of other areas as well – not only how the budgetary resources targeted at the economic crisis are spent. We uncover and prevent offenses in the credit and financial market as a whole. Compared to the results for 2007, no criminal rate growth in the country’s financial system has been observed yet.

– But the turmoil has only begun. Would you predict an increase in the number of economic crimes this year?

– The crisis can indeed make the situation in some spheres of economic activity quite complicated. More violations involving illegal transfers of money is predictable. This can slow down financing of small and medium-size enterprises and cause a delay in the implementation of infrastructural projects. Also, in view of economic instability, more attempts of plundering budgetary funds allocated for projects of state corporations and federal target programs can be expected to be made.

– Should we be prepared for a property redistribution and hence, a new wave of corporate raids?

– Mergers and acquisitions not inconsistent with Russian legislation will certainly continue, especially for many enterprises that are on the verge of bankruptcy today and are compelled to optimize their management structure. As for takeovers orchestrated through forceful methods, police authorities performed a number of successful operations against such raiders in Moscow, St.-Petersburg, as well as Sverdlovsk region, Leningrad reigon, and a number of other regions. Facing the counteraction of law enforcement, the raiders have now discarded the use of gangster tactics. Since 2004, the number of such captures has been steadily decreasing. Besides, the enactment of a package of anti-raider laws, which are currently in the State Duma, would be of a great value.

– What problems is your department facing with regards to the fight against corruption?

– We consider corruption as one of the elemental hazards for the economy of the country, and we will struggle against dishonest officials disregarding their ranks and titles. Last year we boosted the law enforcement bodies’ ability to detect crimes committed by public authorities and local authorities. Among the corrupt officials who were brought to justice, there are not only ordinary employees, but also agency heads.