Comrade Criminal: Russia’s New Mafiya
Early Thursday morning, June 8, 1995, FBI agents burst into an apartment in Brighton Beach and placed a burly, balding Russian under arrest. Subsequently, when he was taken to the Federal District Court in Brooklyn for a preliminary hearing on charges of extortion, the FBI identified him as Vyacheslav Ivankov, a man known as “Yaponets” (The Japanese), who has long been considered one of the kingpins in the shadowy but increasingly active Russian underworld. The arrest was the most tangible evidence to date that Russian syndicates had spread into North America.
It should have come as no surprise that Russian gangsters are active in the United States. In his timely book describing the crime scene in post-Communist Russia, Comrade Criminal, Stephen Handelman reports that at a meeting of Russian crime lords, held as the Soviet Union was collapsing, in December 1991, Ivankov had been delegated to come to the United States to investigate “commercial opportunities.” Presumably, the public will learn more about the opportunities he identified when Ivankov and his eight codefendants are brought to trial.
The threat of Russian criminals operating in the United States is not trivial, but there seems no reason to doubt that American police can prevent a large-scale entrenchment here if they give the problem adequate attention. And they seem to be doing so. Zachary W. Carter, the US attorney in the eastern district of New York, told The New York Times following Ivankov’s arrest that federal authorities are determined “not to permit Russian organized-crime groups to mature the way domestic crime groups have.”
The growing crime in Russia should be of great concern because we cannot be confident that Russian police, prosecutors, and courts are capable of coping with it. If Russia does not develop effective means to control the spread of organized crime, the results can have a deeper impact on our lives than the activities of a few criminals in our own midst. Rampant criminality is now the most formidable barrier to a democratic free-market society in Russia. It creates conditions that could bring a dictator to power or—perhaps even worse—begin a process of fragmentation that would destroy any effective central government in the country.
The US Congress rarely summons State Department officials to testify on foreign criminal activity, but concern about conditions in Russia caused the Senate Select Committee on Intelligence to invite James F. Collins, the department’s senior coordinator for Russia and other ex-Soviet states, to testify on the subject on March 15 of this year. 1 Before outlining the US policies designed to protect American citizens and to assist the Russian government in coping with the problem, Collins pointed out that
crime now poses—some three-plus years after the end of the Soviet Union—a major challenge to the governments and the citizens of the NIS [New Independent States] as they pursue the uncharted road from communist totalitarian authority to democracy and market economies.
He pointed out that the number of economic crimes in Russia increased by 14 percent in 1994, and drug-related crimes by 40 percent. Criminal elements seem to control an enormous portion of retail trade. According to Collins, “unregistered”—i.e., not legally reported—imports and sales of consumer products accounted for some 46 percent of all retail sales in Russia. Though some “unregistered” trade may be carried on by otherwise honest traders trying to avoid punitive taxes, most of it probably involves organized criminal groups acting under the protection of crooked officials.
When Russians speak of organized crime, they normally refer to “the mafia” (or mafiya, as Handelman spells it, to distinguish it from its Western counterpart) in the singular. However, organized crime in Russia is emphatically not part of one gigantic organization. There is a multitude of gangs, and in addition thousands of organized groups with origins in the former Communist Party apparatus, the state industries, the military, and the KGB. Handelman’s vivid picture of this obscure and confusing world is based not only on a thorough study of the available literature on the subject but also, and most notably, on lengthy interviews with Russian police investigators and prosecutors, journalists who specialize in the crime beat, businessmen in a position to observe the mobsters, and even some of the criminals themselves. His is by far the most lucid and informative treatment of this important subject that has appeared in print.
Among the virtues of Comrade Criminal are its clear account of the various types of illegal groups and its description of their origins and development. The professional criminals with the longest history as a coherent organization are the vory v zakone, “thieves in the law,” who existed in tsarist times and retained their organization throughout the Soviet period. Their leaders spent much of their lives in prison but maintained their authority over their criminal organizations while in or out of custody. Vyacheslav Ivankov, for example, was released as recently as 1991 from a ten-year sentence in a Siberian prison. Traditionally, the leaders lived an almost ascetic life and put most of their profits from criminal activity into a common fund. They lived by a strict code of silence and mutual protection (not unlike that observed by the “men of honor” in Sicily) and were vehemently anti-Communist. They often bribed Soviet officials, but no member who had been associated with any Communist organization, even in his youth, was allowed to become a vor v zakone; he would instead be relegated to a subordinate position in the gang.
With the cooperation of Soviet officials in their pay, the vory v zakone controlled most of the “shadow economy” during the Soviet period. During the late 1980s, the legalization of some private commercial activity gave the vory v zakone new opportunities to expand into legitimate activity and, apart from the Communist Party and government bureaucracy, they were the only significant group with access to the capital necessary to establish business of any size. Furthermore, they had experience in operating in a market economy of sorts—not a free market, to be sure, but one not controlled by Gosplan.
Gangs controlled by the vory v zakone would have been a problem for any Russian government trying to convert a command economy to one based on market principles. The problem could have been managed by even a modestly effective law-enforcement system if the traditional criminals had not been joined by a flood of newcomers from a different sort of criminal organization, the Communist Party of the Soviet Union. Even before the Soviet Union collapsed in December 1991—certainly from 1990 and possibly beginning earlier—Party officials began to divert funds into commercial enterprises and foreign banks. In addition to its own resources, the Party could draw on government assets whenever it chose, since it totally controlled the state bureaucracy.
Handelman brings to light one factor which has received little attention in the West, the Communist Party’s association with organized crime from its very inception. Lenin, Stalin, and the other Bolshevik founding fathers much admired the conspiratorial mores of the criminal world, a world they came to know well in the tsar’s prisons. Much of Bolshevik Party structure and its code of conduct were modeled on these criminal gangs, and in its early years the Party obtained a large part of its financing from criminal activity such as bank robberies. Even when the Bolsheviks had created a government totally under their control, Party business continued to be handled in a conspiratorial manner, including a requirement of absolute obedience and observance of a strict code of silence in regard to “Party matters.”
When I was ambassador to Czechoslovakia, in the early 1980s, I heard of an incident that illustrates the point. Though I was unable to confirm that it actually occurred, it was plausible and my Czech sources were convinced that it was true. By their account, an enterprising translator had convinced a local publisher that it would be a good idea to issue a Czech translation of Mario Puzo’s The Godfather. It showed, he explained, the moral decadence of Western society and, by implication, the virtues of “socialism.” Expecting a best seller, the publisher ordered a printing of 200,000 copies. But before they were put on sale, officials in the ideological section of the Party Central Committee had to give the book their imprimatur. When they read it, the ideological watchdogs were aghast. They accused the publisher of subversive intent for daring to publish a book which was obviously a veiled description of the modus operandi of the Czechoslovak Communist Party. Unfortunately for the Party censors, publication had already been announced and if the book did not appear at all, speculation about the reason could be damaging. Therefore, the publisher was ordered to pulp all but a few thousand copies, which could be sold discreetly to reliable Party members.
Communist Party finances remain to this day the best-kept secret of the entire Soviet period, except that some transfers to foreign Communist parties have been documented. Nobody has a clear idea of what really happened to the vast sums that were in the Party’s coffers during its final months. Yeltsin demanded at the 1990 Party Congress that all members of the Central Committee be given access to the Party’s financial books, but this proposal, along with others he made, was ignored, and he resigned his Party membership on the spot. When charges that Party funds were being misused became louder in 1991, an official investigation was launched, only to peter out without any announced result. Circumstantial evidence, including the August 1991 suicide of Nikolai Kruchina, the Party’s chief financial officer, just before an investigation was to start, suggested that there were secrets some wished to bury. If so, they are still buried, and the conclusion most observers have drawn is that Party funds were hurriedly sent abroad or laundered through front organizations and are now being used for the benefit of persons well enough placed to discourage further serious investigation.
Apparatchiks turned entrepreneur could rely on support from likeminded Party officials, well trained in conspiratorial techniques and with valuable contacts among key elements of the bureaucracy such as the tax office, the customs administration, and regulatory authorities, not to speak of the police and former KGB. And they were not the only newcomers to Russian gangland. Other groups formed around industrial managers who set out to milk the enterprises they managed and to acquire ownership control of them as the privatization program went forward, and also around current and former KGB officials. Most notably and dangerously, military officers became the principal source of a flood of weapons which spread through the underworld in Russia and the other Soviet successor states following the Soviet Union’s collapse.
Vadim Bakatin, who served as Gorbachev’s minister of internal affairs from 1988 to 1990 and as KGB chairman (with a mandate to liquidate the organization) in the fall of 1991, told Handelman in 1993: “Our bureaucrats, police, procurators, judges, even the KGB, were merging with the underground world. It was a critical change in the development of crime in our country.” When law enforcement officers in Moscow showed Handelman mug shots of the eighty persons considered to be the leading criminals in and near Moscow in 1993, he noted that fewer than a quarter of them were vory v zakone. Most were listed as industrial managers or business directors and obviously had come from the Communist nomenklatura.
See James F. Collins, "Crime in the New Independent States: The U.S. Response," U. S. Department of State Dispatch, April 3, 1995, pp. 269-273.↩
See James F. Collins, “Crime in the New Independent States: The U.S. Response,” U. S. Department of State Dispatch, April 3, 1995, pp. 269-273.↩