All through the 1970s, Soviet Fishing Ministry officials smuggled precious Russian black caviar abroad in cans marked "smoked herring," reliable sources here report, accumulating an illegal hard currency fortune abroad that they used to buy foreign goods while traveling in the West.
A secret investigation by the Interior Ministry has smashed the smuggling ring and led to the arrests about 200 people in the ministry, its fish market chain Okean (ocean), and in Caspian Sea caviar factories and sturgeon fishing fleets, the sources say.
An Interior Ministry official acknowledged to a Western reporter today that an investigation of the Okean markets is under way, but he refused to provide details. A Fishing Ministry spokesman refused to speak with the Western press.
But highly reliable and well-informed Soviet and Western sources say they understand the discovery of the scandal forced the resignation last year of longtime Fishing Industries minister Alexander A. Ishkov, deputy minister Vladimir I. Rytov, assistants I.V. Nikonorov, and V.P. Zaitsev, and S. I. Guschyan, deputy chief of resources and fish products marketing.
The official Soviet news media has not reported the caviar smuggling operation, which one well-informed source said amounted to a major economic scandal. A source said that dozens of officials, if found guilty, could be executed by firing squad, the usual penalty under Soviet criminal law for major hard currency crimes.
The investigation reportedly has turned up evidence that the smuggling ring brought at least one Western European firm, which has not been identified, into the conspiracy to receive the caviar.
The delicacy, egges taken from the Caspian Sea sturgeon, is one of the world's most expensive gourmet delights. It currently sells for about $25 an ounce in Washington.
The caviar reportedly was shipped out of the Soviet Union in three- and five-kilo sealed cans marked "smoked, seasoned herring"
Properly sealed, such caviar can remain edible for months. The caviar was repacked and sold in Europe, with the Soviet conspirators allegedly banking their profits in a Swiss account that they used from time to time for buying sprees while on official trips abroad.
It is said, however, that the Soviets were careful not to splurge and buy too many Western goods after dividing the profits garnered by the Europeans from buying herring cheap and selling the caviar at its usual high prices.
"people here don't like to show their wealth since it becomes too obvious," a source said.
It is not known here whether European police are cooperating with the Soviets in their probe, or whether the Soviets have asked for assistance.
The elaborate scheme began with Caspian Sea fishermen and workers at the state-run caviar factories surreptitiously diverting their catch into the illegal system, altering the written reports to cover the descrepancy, and than passing the caviar along to special facilities where the delicacy was packed, mislabeled and shipped west.
The kickbacks to buy silence are said to have been sizable. One source said that police investigators who raided a popular Moscow restaurant in connection with the probe found suspects with "gold, silver and jewels unimaginable in the Soviet Union."
Soviet black caviar production has hovered around a reported 100 tons a year recently, but several sources said that careful sturgeon management programs and a cleanup of the inland sea initiated about 15 years ago by the Soviets had led to a substantial increased in caviar production, which may have been covered up by the smugglers. It is impossible, sources said, to estimate how much caviar may have passed into the illegal system.
Sources said the operation was discovered accidentally because of very Russian "disorderly ways."
Some of the mislabeled cans found their way onto the shelves of the Fishing Ministry's Okean stores, according to this account. For a while, startled Moscow shoppers who had paid $7.50 for a large can of smoked fish kept silent when they opened it to discover the valuable caviar instead.
But one day, it is said, the wrong man bought the wrong can. He was a police investigator and when he found caviar inside instead of smoked fish, "he decided to tug on this thread, and he pulled out the whole chain."
The investigator's discovery is thought to have occured in late 1978 or early 1979 and the probe developed quickly. Ishkov, a senior fishing industry official under Stalin, had been head of the far-flung and economically profitable organization since the early 1960s.
The Communist Party newpaper Pravda on Feb. 7, 1979, reported in a one-sentence item on the back page that Ishkov, 73, had been "released" from his post to retire on pension by order of the Supreme Soviet Presidium, headed by President Leonid Brezhnev.
Pravda also reported in a terse, separate article that Premier Alexei Kosygin and Deputy Premier Tikhon Kiselyov that same day had "discussed questions of expanding fish output, fish products, and improving the quality and assortment" of fish with Fishing Ministry officials as well as senior bureaucrats of the Trade Ministry and Production Resources Ministry.
Pravda made no connection between the two events but Western sources scoffed at the idea that Ishkov, a member of the aging leadership, had been allowed to retire because he is 73.
One source alleged that Kosygin personally intervened to save Ishkov from prosecution on grounds that a trial of a man who had been a candidate (nonvoting) member of the ruling Central Committee for 23 years, could damage public confidence in the party leadership.
Ishkov was succeeded by Vladimir Kamentsev, first deputy in the ministry since 1965. Several sources said Kamentsev, described as a gregarious and energetic bureaucrat, is heading the investigation of his former boss's operations.