Police Raid Medvedev’s Innovation Hub Over Fraud Inquiry

(Bloomberg – bloomberg.com – Ilya Arkhipov & Henry Meyer – April 18, 2013) Russian police raided the Skolkovo innovation hub, a project championed by Prime Minister Dmitry Medvedev, a day after his speech to parliament was overshadowed by a leaked video.

Investigators talked today to the foundation’s head, billionaire Viktor Vekselberg, and other top officials, Skolkovo spokesman Roman Shcherbakov said by phone. The federal Investigative Committee’s press service confirmed that officers were searching the technology hub’s offices.

The Moscow-based law enforcement agency said in February that it was investigating the misspending of 3.5 billion rubles ($111 million) provided by the government that had been on deposit in a bank affiliated with Vekselberg.

President Vladimir Putin threatened April 16 to dismiss underperforming officials at a meeting with ministers and regional governors, according to a video leaked hours before an annual speech to lawmakers by Medvedev. The video, which was recorded during a part of the meeting that Putin had asked not to be filmed, showed the Russian leader addressing the governors during a discussion about housing, his spokesman, Dmitry Peskov, said yesterday.

‘Government Inefficiency’

The leaked warning and the raid today “are linked indirectly in the sense that they are both negative for Medvedev,” Sergei Markov, a political adviser to Putin’s staff and vice rector of the Plekhanov Russian University of Economics, said by phone. “Medvedev’s problems are increasing because of his obstinacy and the inefficiency of his government.”

Medvedev’s spokeswoman, Natalya Timakova, didn’t immediately respond to a request for comment.

Russia’s $2 trillion economy is growing at the weakest pace since a 2009 contraction as Europe’s debt crisis curbs exports and corporate investment. Putin has told the premier to draw up measures to revive growth after Economy Minister Andrei Belousov warned that a recession is possible without stimulus.

Putin, 60, ceded the presidency after completing the maximum two consecutive terms allowed by the constitution in 2008. Medvedev, 47, became president and appointed Putin his premier, with the two swapping jobs last May after parliamentary elections that sparked the biggest protests of Putin’s political career.

Skolkovo, unveiled in 2010 and based outside Moscow, was a hallmark of Medvedev’s efforts to modernize the world’s biggest energy exporter by weaning Russia off its reliance on commodities and nurturing a knowledge-based economy that can compete globally.

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