The Bank of New York confirmed today that it fired a second employee in its Eastern European division as part of an internal inquiry of allegations that Russian organized crime used several business accounts to launder billions of dollars.
Officials said Svetlana Kudryavtsev, a New York-based associate, was notified of her dismissal earlier this week. She had been placed on leave several days earlier after refusing to answer questions relating to allegations that $10 billion or more was moved through nine or more accounts at the bank with links to the same person.
Although bank spokesman Cary Giacalone declined to elaborate, a source familiar with the action said Kudryavtsev was "terminated for cause" for failure to "cooperate in the bank's ongoing investigation into certain accounts." Among other things, she declined to comply with the bank's request that she talk to federal investigators, the source said.
A woman who identified herself as Kudryavtsev on the telephone declined to comment.
Bank officials think Kudryavtsev was friends with London-based Vice President Lucy Edwards, an executive in the Eastern European division who was dismissed last Friday after bank officials accused her of falsifying bank records, violating internal policies and failing to cooperate, a source said.
Edwards is married to Peter Berlin--a Russian native and now an American citizen--who sources say is linked to a variety of Bank of New York accounts that may have been involved in the alleged money-laundering scheme.
Berlin is listed on business documents in New Jersey as a director of Benex International Co., which managed an account at the Bank of New York that investigators believe handled more than $4 billion in transfers over the past year. Officials close to the case believe Berlin also is associated with nine or more companies that had accounts at the bank that may have been used in the alleged scheme, sources said.
Investigators say Benex appears to have financial ties to Semyon Mogilevich, a Russian native who intelligence officials and law enforcement authorities say is involved in arms dealing and other criminal activity around the world. Mogilevich has denied the allegations.
In another matter that may be related to the Bank of New York probe, the lawyer representing a giant Russian titanium operation, Avisma, said yesterday that a Justice Department official has asked for documents relating to its lawsuit that accuses U.S. investors of using offshore banks to launder profits skimmed from the company.
"I have spoken to a representative of the U.S. Justice Department, and on behalf of Avisma have pledged my client's full cooperation in what appears to be an extensive investigation," lawyer Bruce Marks said. A spokeswoman for the U.S. attorney's office in Boston would neither confirm nor deny the assertion by Marks.
Avisma's civil lawsuit, filed last month in federal district court in New Jersey, says Avisma lost $50 million when investors forced the company to participate in a complex "transfer-pricing" scheme and then laundered the money using offshore companies. It seeks $100 million in damages.
Among the defendants are Dart Management Inc. and the Anderson Group Inc. Officials of the companies did not return phone calls yesterday, but in previous statements they have denied any wrongdoing.
The suit contends that Avisma was coerced into buying raw materials at inflated prices from offshore companies and then selling its product below market prices to the offshore companies. When companies in Ireland and the Isle of Man sold the product at market prices, they pocketed the additional money, Marks said.
Marks alleged the scheme began four years ago, when the company was under the control of Russia's Menatep bank, and he contends it continued after U.S. investors took control of a majority of shares.