Influential Russian politician and businessman with ties to Latvia charged in the US
The US has filed criminal charges against Alexander Babakov, the Deputy Chairman of the Russian State Duma, who is well known in some circles of Latvian politicians and businessmen - in particular, among opponents of Aivars Lembergs.
In Latvia, Babakov became the subject of discussion when it emerged that he was the most likely owner of Macasyng Holding, a company registered in the Netherlands, which had gained significant influence in Latvijas Krājbanka, then still partly owned by the Latvian state.
Macasyng Holding also claimed a controlling stake in Latvijas Krājbanka in 2003, but, as is well known, it was not Babakov but another Russian citizen, Vladimir Antonov, who later took control of Latvijas Krājbanka.
In 2001, Neatkarīgā revealed that Macasyng Holding had also become a shareholder in the Russian Armed Forces football club ACSK, while at the time it was Babakov who chaired the ACSK board of directors.
When Arnolds Laksa became Chairman of the Saeima Defense and Internal Affairs Committee and, consequently, a member of the National Security Council, Neatkarīgā revealed that he was millions in debt to Macasyng Holding, the co-owner of ACSK in Russia.
For these revelations, as well as for exposing the transactions carried out for Babakov through Latvijas Krājbanka (e.g. the purchase of Ukrainian hotels and energy companies), Laksa tried to get the Security Police to open a criminal case against the authors of this article. When this failed, Laksa initiated legal proceedings against the publishers of Neatkarīgā, JSC Preses nams and SIA Mediju nams, which lasted for years.
Various facts and documents show that Babakov was a business partner not only of the Latvian politician Arnolds Laksa, but also of the financiers Vilis Dambiņš, Valts Vīgants, Dzintars Pelcbergs and Viesturs Šutko, an influential advisor on information technology to former Prime Minister Einārs Repše and at the time a member of the Board of Directors of Lattelekom.
Charged with conspiracy
The US Attorney General Damian Williams has charged Babakov and two employees of his office, Russian citizens Aleksandr Vorobev and Mikhail Plisyuk, with "conspiring to have a U.S. citizen act as a Russian agent in the United States without notifying the Attorney General"; "conspiring to commit visa fraud"; "conspiring to violate and evade U.S. sanctions". Among other things, the indictment states: "Aleksandr Mikhaylovich Babakov, 59; Aleksandr Nikolayevich Vorobev, 52; and Mikhail Alekseyevich Plisyuk, 58,
operated an international foreign influence and disinformation network to advance the interests of Russia.
Through these operations aimed at influencing the course of international affairs, the defendants worked to weaken U.S. partnerships with European allies, undermine Western sanctions and promote Russia’s illicit actions designed to destroy the sovereignty of Ukraine. The defendants schemed to affect U.S. policy towards Russia through staged events, paid propaganda and the recruitment of at least one American citizen (CC-1) to do their bidding in an unofficial capacity and without notice to the Attorney General, as required by law.
In pursuit of these goals, the defendants sought to co-opt U.S. and European politicians and to influence public opinion in their favor, using American and European citizens as their proxies to validate them, bring them access to power, evade sanctions and obscure their true objective to advance Russia’s foreign policy."
They tried to recruit Westerners
The indictment is 44 pages. It describes in relative detail the activities of the three individuals from 2012 onwards. The accused Russian nationals attempted to arrange meetings with several US congressmen, planned to pay for them to attend a conference in Yalta, and planned several informal meetings with US politicians. These fell through partly because Russian citizens were denied entry visas by the US in 2018. The trio is accused of trying to recruit one US citizen and two consultants working in Europe. Their names are not disclosed in the indictment and have been encrypted.
Babakov, 59, is currently Deputy Speaker of the Russian State Duma for the pro-Vladimir Putin party A Just Russia — For Truth. He is also President Putin's special representative for cooperation with compatriot organizations abroad.
The news of the charges against Babakov and his two employees has not gone unnoticed in the Russian press and Telegram channels. It has been suggested that the US authorities are taking such a belated action against a powerful Russian politician because for a long time the West saw an opportunity to communicate with Putin through Babakov (just as Latvia used Petr Aven for many years). In addition, a number of influential Western businessmen have reportedly recommended that Babakov should not be touched because he owns many business structures in the West that are important for the Western economy.
Latvian guys became debtors to the Russian Ministry of Defense
Several years ago, Neatkarīgā described how the links between Babakov and the Latvian citizens in question might have developed.
After Latvia regained its independence, three boys from Jūrmala - classmates Vilis Dambiņš, Valts Vīgants and Dzintars Pelcbergs - founded Lainbanka. At the beginning of 1995, Lainbanka started to have financial problems and immediately the bank's creditors started to bring various fictitious transactions to light, for which Vilis Dambiņš even went to jail for a few days. Lainbanka's problems were a precursor of the devastating banking crisis of 1995.
In the crisis, Lainbanka had spent several million lats of the Russian Ministry of Defense's huge sums of money earmarked for Russian military pensioners in an attempt to pay its customers and stabilize its operations.
Basically, Lainbanka's management became debtors to the Russian Ministry of Defense.
The debt was never forgiven, as evidenced by the fact that a settlement agreement was concluded between Lainbanka and the Russian Ministry of Defense and approved by the court (Neatkarīgā has a copy of this court ruling). The settlement agreement provided that the debt would be settled by some supplies of medicines from Latvia. However, the fact that these deliveries were hardly made in the proper amount is evidenced by the criminal case brought by the Russian Prosecutor General's Office in this respect several years later. However, nothing is known about the outcome of this criminal case.
According to Firmas.lv, Arnolds Laksa was Chairman of the Supervisory Board of Lainbanka at the time of these events (from 1993 to September 16, 1996). Aija Punāne, the sister of Laksa, was a member of the Board of Lainbanka at around the same time.
A typical "pocket bank"
Later, Laksa became President of Union Baltic Bank in Riga (UBBR). UBBR's data have been purged from the electronic database of the Register of Enterprises. For example, the only references to the former existence of this bank in Firmas.lv are to a company called "International branch of joint stock company Latvijas Krājbanka", whose former name was - and we quote accurately - "JCS joint stock commercial bank "Rīgas Apvienotā Baltijas Banka" "UNION BALTIC BANK IN RIGA"". That is a complicated name.
However, some documents of UBBR, such as annual reports, can be found in the Latvian State Archives, where they were handed over by the liquidator of Latvijas Krājbanka. And from these annual reports it is clear that UBBR was the "pocket bank" of SWH Riga - it financed almost exclusively legal and natural persons related to SWH Riga.
The term "pocket bank" is used even in the official annual reports of the UBBR, and thus the bank itself has explicitly acknowledged the obvious.
As quite competent witnesses (former SWH Riga vice-presidents Andris Tālbergs and Aivars Borovkovs) testified in the Lembergs trial, In the early 1990s, SWH Rīga was the most powerful economic group, turning over millions, guarded by no more and no less than the elite battalion of the Suži intelligence battalion and sponsoring the first post-independence parliamentary elections with a really huge sum for those times - 1.2 million dollars - giving the most to the Latvian Way (Latvijas Ceļš) party.
In the mid-1990s, however, this economic group began to decline, as it was mired in huge debts, including to Ventspils City Council and SJSC Ventspils nafta, the settlement of which, among other things, is one of the most important motives of the Lembergs case.
The most scandalous privatization
Despite the above, in 1997 the Privatization Agency chose UBBR as the strategic partner and privatizer of Latvijas Krājbanka. The privatization of Latvijas Krājbanka is probably the most scandalous privatization project in Latvian history - from the first decision to merge UBBR into Latvijas Krājbanka to the auction of the last state-owned 25% stake in Latvijas Krājbanka in May 2003. The scandals continued long afterwards and are still mentioned in the Lembergs trial, for example by Laksa and former SWH Riga boss Ainārs Gulbis in their testimonies.
For example, Gulbis, who was also Chairman of the Supervisory Board of UBBR and indirectly also a large shareholder, when testifying in the Lembergs trial, actually only remembers the pain he suffered during the privatization of Latvijas Krājbanka, when he was reminded of a four million dollar debt by SJSC Ventspils nafta. Gulbis believes that this reminder of the debt was made by Lembergs and not, for example, by the management of Ventspils nafta.
After UBBR was merged into Latvijas Krājbanka in 1997, Laksa became President of Latvijas Krājbanka. After some time, Dambiņš and Vīgants, and later Dz. Pelcbergs also appeared in the management of Latvijas Krājbanka.
Babakov comes after the debt?
It was Laksa who attracted Macasyng Holding, a company registered in the Netherlands and most probably owned by Babakov, as an investor in Latvijas Krājbanka.
But in 2001, Neatkarīgā revealed that Macasyng Holding not only had a significant influence in Latvijas Krājbanka, but also owned a 49% stake in ACSK. This was read in the Russian press by Neatkarīgā, as was the fact that 26% of ACSK is owned by the Russian Ministry of Defense.
There was also information that Alexander Babakov, Chairman of the Board of Directors of ACSK, was linked to Macasyng Holding.
At the beginning, this was just an interesting fact, because the representatives of Latvijas Krājbanka kept repeating that the owners of Macasyng Holding came from Western Europe. But then Arnolds Laksa became a Member of the Saeima and, as an influential representative of the Latvia's First Party (Latvijas Pirmā partija, LPP), he also became the head of the Saeima Defense and Internal Affairs Committee and, at the same time, a member of the most secretive, the Latvian National Security Council.
When Laksa submitted his official's declaration, it turned out that he owed more than one million dollars to Macasyng Holding.
A business partner of the Russian Ministry of Defense has a Latvian NSC member on the hook with a loan of more than a million dollars!?
At the time, this seemed alarming to Neatkarīgā, but to the Latvian authorities - like water off a duck's back. On the contrary, Laksa was welcomed in the Latvian Prosecutor General's Office. His testimony and copies of documents were very useful for many Latvian and Russian politicians in the prosecution of their disliked Mayor of Ventspils, Aivars Lembergs.
*****
Be the first to read interesting news from Latvia and the world by joining our Telegram and Signal channels.