MOSCOW — A high-profile corruption case shook Russia’s establishment and appeared to shed light on a power struggle within President Vladimir Putin’s inner circle on Tuesday, after authorities detained the country’s economic development minister on suspicion that he demanded and accepted a $2 million bribe over a controversial privatization deal.
Alexei Ulyukayev became the highest-ranking official to be charged with corruption during Putin’s tenure as Russia’s leader, and the first national minister to be arrested while in office since Joseph Stalin’s dreaded security chief Lavrenti Beria was detained in the Kremlin in 1953 after the Soviet dictator’s death.
Some Putin critics saw Ulyukayev’s arrest as a tactic by the Russian leader to keep his senior lieutenants in check.
“The arrest of such a loyal and important official as Ulyukayev is a powerful act of intimidation, first of all, for the benefit of officials,” Grigory Yavlinsky, leader of the liberal Yabloko party, said in a Facebook post. “Everyone should know: Anything can happen to you at any moment; that’s the main message.”
Authorities on Tuesday said that Russia’s Federal Security Service had been listening to Ulyukayev’s phone conversations for months, and Putin’s spokesman, Dmitry Peskov, told reporters that the Russian president had been aware of the investigation all along. “These are very serious accusations, and only a court can pass a verdict,” Peskov said, according to news agencies.
Russia’s Investigative Committee, the state agency that looks into major crimes, said Ulyukayev was caught “in the act” of receiving the $2 million bribe in exchange for signing off on the $5 billion acquisition last month by the state-run oil giant Rosneft of a 50 percent stake in a smaller state-owned company, Bashneft.
The sale was reported in the Russian media to have caused dissension between rival factions in the Kremlin. Rosneft’s top official, Igor Sechin, a Putin confidant, pushed for the right to purchase Bashneft. Prime Minister Dmitry Medvedev headed a second group that believed Bashneft should be sold to private investors, not a state-owned company.
Ulyukayev, 60, a minister in Putin’s cabinet since 2013 who has been overseeing the sale of state assets, initially opposed the Bashneft deal on the grounds that a state-owned company purchasing a state-owned company is not privatization.
He eventually signed off on the sale, which was pushed by Putin as a way to close the country’s budget deficit, which is widening in the face of low oil prices.
According to the Investigative Committee, Ulyukayev demanded a bribe from a Rosneft representative in return for a positive appraisal of the deal.
“The defendant threatened to create impediments for the company’s future operations by use of his official capacities,” said Svetlana Petrenko, spokeswoman for the Investigative Committee. Ulyukayev could face up to 15 years in prison if convicted. After a court hearing Tuesday, he was placed under house arrest.
Russia’s political leadership lined up to cheer the arrest as a sign that top officials in a country long associated with official corruption can no longer operate outside the law with impunity.
Vyacheslav Volodin, a former Putin aide and now the speaker of the lower house of the Russian parliament, said the arrest means that there are “no untouchable people” in Russia.
Others took the case as a sign of political tension.
Gleb Pavlovsky, a former Putin strategist, pointed out how odd it was that Putin apparently knew that the minister was under investigation for months but let him stay in office instead of firing him.
“This proves that things are very bad at the top,” Pavlovsky told TV Dozhd. “Very bad.”
Others pointed to the oddities surrounding the investigation.
The Investigative Committee emphasized that although Ulyukayev was arrested on charges of taking money to facilitate a deal, the deal itself had been completed legally and was not subject to investigation.
The man whom Ulyukayev is alleged to have strong-armed, Sechin, is perhaps one of the most powerful people in Russia and someone who has Putin’s ear. No special investigation would have been needed for that. Sechin could have just told his boss that he was being shaken down.
“One would have to be crazy to extort a bribe from he most influential person in the country,” said Alexander Shokhin, who served with Ulyukayev in the earliest post-Soviet Russian governments, which sought to privatize state-owned companies to kick-start a transition to a market economy, a process that was marred by widespread corruption among Kremlin insiders.
Shokhin, who heads Russia’s biggest business lobbying group, also pointed out how odd it was that Ulyukayev would have asked for a bribe when the company sold at market price.
“If Aleksei Ulyukaev had been charged with hitting an old babushka while driving his Mercedes G-Class at high speed at night in Moscow, it would’ve looked more plausible,” Shokhin told the Meduza news agency.
Many in Russia’s political ranks hold old “reformers” such as Shokhin and Ulyukayev responsible for selling out Russia to the West after the Cold War.
That sentiment pervaded the comments by lawmaker Nikolai Kovalyov, a former head of the Federal Security Service, who referred to verses Ulyukayev wrote in 2011 for his son: “Go my son, go from here; On this globe you will find many places; where one step forward does not mean 500 steps back; Where they don’t say everything backward all the time.”
“I am not surprised” by the arrest, Kovalyov said. “I expected something of this kind to happen when I read his verses calling on his son to leave Russia.”
Editor’s note: An earlier version of this story misidentified the speaker of the lower house of the Russian parliament, Vyacheslav Volodin, and his former position in the Putin administration. This version has been corrected.
Natalya Abbakumova contributed to this report.