Explainer-Konstantin Strukov, the Russian gold billionaire facing Russian asset seizure
MOSCOW - Russian prosecutors are seeking to seize billionaire Konstantin Strukov's majority stake in major gold producer Uzhuralzoloto (UGC) for the state.
A hearing at the Sovetsky District Court in the Urals city of Chelyabinsk is scheduled for July 8 in a case that marks the latest in a string of asset seizures by the Russian state.
WHO IS KONSTANTIN STRUKOV?
Strukov, born in Russia's Orenburg Region in 1958, worked in mining straight after graduating from Magnitogorsk State Technical University.
Uzhuralzoloto was founded as a Soviet enterprise in 1976 and was privatised in 1993 following the Soviet Union's collapse. Production had almost ground to a halt by 1997, when Strukov became head of the unprofitable enterprise.
A business of the same name was created and assets, including the Svetlinsky gold deposit - the largest in the Urals region - were transferred to it.
The company subsequently went bankrupt and Strukov was able to acquire its underlying assets and shares in a new company for 12.8 million roubles ($162,600).
Top stories
Swipe. Select. Stay informed.
Singapore Eligible S'poreans to get up to $850 in GSTV cash, up to $450 in MediSave top-ups in August
Singapore Four golf courses to close by 2035, leaving Singapore with 12 courses
Singapore Singapore's second mufti Shaikh Syed Isa Semait dies at age 87
Singapore Fewer marriages in Singapore in 2024; greater marital stability for recent unions
Singapore Shell heist: Second mastermind gets more than 25 years' jail for siphoning $100m of fuel
Asia 72-year-old man on diving trip to Pulau Tioman in Malaysia found dead on the beach
Singapore Jail for ex-auxiliary police officer who loaded one bullet and accidentally discharged revolver
Singapore $1.46b nickel scam: Ng Yu Zhi opts to remain silent after judge calls for his defence
After that, production restarted thanks to gold deposits it had acquired in the Khakassia and Krasnoyarsk regions.
From 2004 to 2012, UGC's annual output increased to 10 metric tons from three tons. The company has 17 core assets and eight processing facilities across two major regional bases.
Production in 2024 fell by 17% to 10.6 tons year-on-year, due to some mines being closed at the regulator's behest. UGC expects output to increase this year to as much as 14.4 tons.
Strukov, whose fortune is estimated by Forbes at $1.9 billion, was placed under sanctions by some Western countries after Moscow sent troops into Ukraine, including Britain, which has said his work as a director of a company in the Russian extractives sector supported the Russian government.
Since 2000, Strukov has served on Chelyabinsk Region's legislative assembly. He is deputy speaker of the region's parliament and a member of the ruling United Russia party.
WHAT IS THE CASE AGAINST STRUKOV?
The Chelyabinsk court told Reuters that Russia's deputy prosecutor general had filed a lawsuit against Strukov and several other people, accusing them of obtaining property "through corruption".
It did not specify further details, but Russian news agencies reported, citing a law enforcement source, that prosecutors were seeking to convert Strukov's entire stake in UGC to state property.
The Kommersant daily, citing court documents, reported that prosecutors believe Strukov used the bankruptcy procedure and his position as a state official to transfer assets to UGC. According to Kommersant, searches were conducted at UGC offices last week in relation to alleged violations of environmental legislation and industrial safety rules.
The newspaper also reported, citing court documents, that 200 billion roubles of Strukov's assets could be confiscated and that he had used a Cypriot offshore company to conceal his involvement with UGC.
Reuters has sought comment from Strukov through UGC.
Strukov owns a 67.8% stake in UGC, according to company data as of the end of 2024. A company connected to Gazprombank bought a 22% stake late last year and the remaining 10% of shares floated on the Moscow Exchange in 2023 and 2024 in two public offerings.
The central bank suspended trading of UGC's Moscow-listed shares on Friday after they slumped almost 30% in two sessions.
The company said in an investor-focused blog on Friday that protecting minority shareholders' rights was a top priority.
An anonymous comment on that post said: "The casino is safer than the stock market."
IMPACT ON RUSSIA'S BUSINESS CLIMATE?
Foreign companies have grappled with the risk of state seizure since Russia sent troops into Ukraine in February 2022, but Moscow, citing strategic stability and domestic security, has increasingly turned its attention to domestic assets too.
It was not clear why Strukov and UGC were targeted.
Moscow has been sending mixed messages on foreign investment, seeking to present Russia as a viable destination for foreign capital, while also arresting top business figures. Foreign investment has declined sharply since the start of the conflict in Ukraine.
Vadim Moshkovich, the billionaire founder of Russia's top agriculture company Rusagro, has been held in pre-trial detention since late March on charges of embezzlement that he denies. REUTERS
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Straits Times
25 minutes ago
- Straits Times
Singer Akon's $7.7 billion ‘Wakanda' futuristic city dream crumbles in Senegal
Sign up now: Get ST's newsletters delivered to your inbox R&B singer Akon' failed to deliver on his dream of a real-life Wakanda in the debt-stricken country. Abidjan, Côte d'Ivoire – Senegal scrapped R&B singer Akon's plans for a US$6 billion (S$7.7 billion) futuristic city on the country's Atlantic Coast, and opted for a scaled-back project in the debt-stricken country that will rely on private funding. Announced in 2018 as a tech-driven, eco-friendly utopia for the global Black community with its own cryptocurrency, initial designs for Akon City, with its boldly curvaceous skyscrapers, were compared by commentators to the awe-inspiring fictional city of Wakanda in Marvel's Black Panther films and comic books. But after five years of setbacks, the 800-hectare site in Mbodiene - about 100km south of the capital, Dakar - remains mostly empty. The only structure is an incomplete reception building. There are no roads, no housing, no power grid, the BBC reported. That project 'no longer exists,' Serigne Mamadou Mboup, head of Sapco-Senegal, the state-owned entity that develops coastal and tourism areas, told L'Agence de presse sénégalaise. In 2024, Sapco gave Akon two weeks to begin work on the development or risk forfeiting the land. Most of it was reclaimed after Akon missed payments to Sapco. Meanwhile the star's Akoin cryptocurrency has struggled to repay its investors over the years, with Akon, Senegalese-American, conceding: 'It wasn't being managed properly - I take full responsibility for that.' Sapco now plans to spend 665 billion CFA francs (S$1.5 billion) turning the area into a tourism hub with hotels, apartments, a marina and promenade connecting the area to a nearby lagoon. The project is being developed as Senegal deals with a debt crisis that emerged after a state audit found that former President Macky Sall's administration accumulated US$7 billion (S$9 billion) of previously unreported loans. The so-called hidden liabilities restricted the West African nation's access to global credit markets and led the International Monetary Fund to freeze US$1.8 billion of funding. The government expects its plan will deliver on part of the original promise, with about 15,000 jobs expected in the first phase, according to Sapco. The new plan may finally offer opportunity for local investment, jobs and a reason for young people to stay, said Jean Wally Sene, a school teacher and resident of Mbodiène. 'For a very long time, people, including Akon, have been coming here trying to sell us dreams and illusions,' Ms Sene said. 'Finally, there's a dream for Mbodiène that we dare to believe in.' BLOOMBERG
Straits Times
25 minutes ago
- Straits Times
US sanctions target North Korean fake-tech-worker scheme
Sign up now: Get ST's newsletters delivered to your inbox Thousands of North Korean workers have been posing as nationals from other countries to infiltrate companies in the US. The US slapped sanctions on individuals and companies linked to a scheme that involves recruiting North Koreans to pose as American tech workers and help fund Kim Jong Un's regime. The Treasury Department's Office of Foreign Assets Control imposed penalties on a 'malicious cyber actor' named Song Kum Hyok, who's accused of having ties with a hacking group linked to Pyongyang, as well as another individual and four companies based in Russia and North Korea. Song allegedly facilitated an IT worker scheme where North Koreans and others working from China and Russia are given false American identities – often using information stolen from US citizens – to gain remote employment with US companies and generate revenues for North Korea. The workers use 'a variety of mainstream and industry-specific freelance contracting, payment, and social media and networking platforms,' the Treasury Department said in a statement. The department also said that in some cases, the IT workers introduced malware into company networks. Thousands of North Korean workers have been posing as nationals from other countries to infiltrate companies in the US and around the world, according to the US government. Last month, the Justice Department announced one arrest and charges against nine people connected to the scheme. In a separate announcement, the State Department said it's offering a reward of up to US$5 million for information that would disrupt the financial means of people engaged in activities that support North Korea. It also offered $10 million for identifying and locating people involved in cyber attacks against critical US infrastructure. BLOOMBERG Top stories Swipe. Select. Stay informed. Asia Why Japan and South Korea are on different paths in the latest US trade salvo Opinion Hyper-competitive classrooms feed the corporate world's narcissist pipeline Opinion Is Donald Trump unstoppable? Singapore Keep citizens at the centre of public service, Chan Chun Sing tells civil servants Business 'It's our grandfather's company, we won't sell', says Wong family as shareholders reject GE delisting bid Asia Ex-Malaysian PM Najib's wife Rosmah wins $30,000 in suit against TikToker Singapore Chuan Grove GLS site snags top bid of $703.6m from Sing Holdings-Sunway joint venture Sport Singapore U-16 girls given footballing lesson in first match of inaugural Lion City Cup girls' tournament
AsiaOne
33 minutes ago
- AsiaOne
FBI launches probes into former FBI director, ex-CIA director, Fox News reports, World News
WASHINGTON — The FBI has launched criminal probes into former CIA Director John Brennan and former FBI Director James Comey, Fox News Digital reported on Tuesday (July 8), citing sources. The probes are over alleged wrongdoing related to past government investigations about claims of Russian interference in the 2016 US elections in which President Donald Trump defeated former Secretary of State Hillary Clinton, the news report said. The CIA and the Justice Department had no immediate comment. The FBI declined to comment. Reuters has not independently verified the probes. The scope of the criminal investigations into Brennan and Comey was unclear, the report added. Trump-nominated CIA Director John Ratcliffe referred Brennan, who served in that role under former Democratic President Barack Obama, for potential prosecution, according to the report. A criminal investigation does not necessarily result in charges. Brennan did not immediately respond to a request for comment. Comey could not immediately be reached. Fox said its sources were from the Justice Department but did not specify the number of sources. "I am glad to see that the Department of Justice is opening up this investigation," White House press secretary Karoline Leavitt told Fox News' Jesse Watters Primetime show in an interview. The probes reportedly target two former officials who have long drawn the ire of Trump and his supporters for their role in investigating Russian interference in the 2016 election. Comey led the FBI when authorities began a criminal investigation in 2016 into potential coordination between the Trump campaign and the Russian government to influence the election. Trump fired Comey in 2017 early in his first term after Comey publicly confirmed Trump was under investigation. The probe was then taken over by former Special Counsel Robert Mueller, who found no evidence of a criminal conspiracy between Trump's 2016 campaign and Russia. Trump railed against the investigation for years and has repeatedly dismissed it as the "Russia hoax". Brennan led the CIA when US intelligence assessed, in a report made public in January 2017, that Russian President Vladimir Putin sought to sway the 2016 US vote in favour of Trump. A CIA review released last week found flaws in the preparation of the 2017 assessment, but it did not contest its underlying conclusion. The Fox News report on the investigations broke as Trump's top officials at the FBI and Justice Department faced online criticism from some Trump supporters for concluding that there was no evidence to support long-held conspiracy theories about the death of accused sex trafficker Jeffrey Epstein. During Trump's first term, the Justice Department appointed a separate special counsel, John Durham, to examine any missteps in the FBI's Russia investigation. Durham brought charges against three lower-level figures who worked on the probe or provided information to investigators, but did not find evidence of a conspiracy to target Trump. [[nid:714960]]
