Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Mavrodi Announces MMM Purges

Sergei Mavrodi announced Thursday that he would purge his troubled MMM joint-stock company of employees who abused their positions and said the reputed pyramid scheme would soon expand abroad.

Mavrodi, who was elected to the State Duma last week after spending two months in prison on tax evasion charges, added that he had little interest in politics and had stood for office solely to get out of prison and back to work.

As a Duma deputy, Mavrodi is now immune to prosecution, although authorities can continue limited investigations into previous charges.

"All MMM personnel must be changed," Mavrodi told a press conference, charging that corrupt executives had precipitated a crisis that forced the company to stop honoring millions of MMM shares and tickets issued before Nov. 1.

"There was too much money involved," he said. "The temptation was too great."

According to Mavrodi, the worst cases of corruption occurred in the special MMM commission set up to repay shares held by the needy at a rate 125,000 rubles each -- their price before the company devalued them to less than 1,000 rubles in July. In one case, he said, a wheelchair-bound invalid had been allowed to redeem securities worth 13 billion rubles ($6 million).

Mavrodi announced Tuesday that he was suspending the repurchase of his company's securities until Jan. 1, causing thousands of investors who had remained loyal to the maverick businessman throughout his stay in prison to denounce him as a cheat.

Seemingly unfazed by his company's predicament, Mavrodi on Thursday confirmed reports that MMM, widely criticized as a pyramid scheme, planned to expand its operations to Western countries.

"The tickets have already been printed," Mavrodi said, referring to the company's pseudo-shares that bear his likeness. "I could successfully operate in Britain. You will have the chance to witness it soon."

Responding to rumors that he was going to resign as president of MMM, Mavrodi said he intended to stay in the job but would not draw a salary because regulations bar Duma deputies from profit-making activities.

Mavrodi said that he would set up a new parliamentary faction in the Duma, but added that he would not follow any political ideology.

"I have no rigid political boundaries," he said. "My primary goal at the State Duma is to protect MMM shareholders' rights."

But he confirmed a previous statement that he had run for the Duma solely to escape prosecution.

"My main aim was to make it possible for MMM to operate normally," he said. "It's pretty hard to operate from a prison cell."