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. Last Updated: 07/27/2016

Decrees Target Banks, Homes, Security Scams

President Boris Yeltsin, vowing to end Russia's production decline, protect investors from financial scams and combat poverty, said Friday he had signed six decrees aimed at providing homes for Russians and reining in Russia's chaotic post-communist economy. In a rare press conference, Yeltsin said he had issued decrees that would regulate the scam-riddled securities market, protect consumers and consolidate the country's overgrown banking system, including lifting restrictions on foreign banks. "Russian business should understand that the time when it was possible to pocket a great deal of money very quickly is passing away and it will never come back," Yeltsin declared. Three of the six decrees were directed at the housing market, including plans to issue housing certificates that would help Russians buy homes, stimulate mortgage lending by banks and turn over unfinished state construction projects to private businesses. The president, who called the news conference to commemorate the fourth anniversary on Sunday of Independence Day, also predicted the steep decline in industrial production could be stopped by next month with the introduction of measures to resolve the inter-enterprise debt problem. He also said monthly inflation would drop to 6 or 7 percent in June, from the May level of 8 percent and remain at that level through the end of the year if tight monetary policies were continued. Declaring victory over his extremist political opposition, Yeltsin said the government can now concentrate on regulating Russia's economy. "We now have an opportunity to focus our efforts on creative activities, on alleviating economic and everyday problems," he said. The objective of the measures was to "launch a frontal offensive to push ahead reforms," he said. The decrees come 18 days after Yeltsin issued six other measures signaling a renewed involvement by the president in directing the country's economy and growing frustration with the slow pace of reform measures from the government of Prime Minister Viktor Chernomyrdin. Yeltsin said another three economic decrees dealing with the responsibility of directors of state enterprises, investor safeguards, and customs regulations for investment projects were being drafted. "Probably there will be more decrees to come," he said. Calling poverty "one of the country's most acute problems" Yeltsin said he would be working with the government to draft a federal program to assist the millions of Russians who have fallen under the poverty line. "Only political liars and adventurists can promise paradise next week," Yeltsin said. "It is a must to draft a federal program for combating poverty which shall be implemented under presidential control." Yeltsin said the banking decree would consolidate the banking system and bolster the Central Bank's regulatory control over the financial system. The decree also lifts controversial restrictions placed on foreign banks in Russia. Yeltsin had introduced the measures ahead of the December elections at the urging of the strong Russian banking lobby. However, the government had promised to lift them after the restrictions became a stumbling block in trade negotiations between Europe and Russia. Yeltsin predicted the involvement of foreign banks would help revitalize the banking system and bring down interest rates, which have been set by the Central Bank at 185 percent annually. "Russian bankers will criticize the president because we are starting real competition," he said. Another decree promised to offer safeguards to investors in Russia's new securities markets, where tens of thousands of investors have been bilked in fraudulent pyramid schemes. Yeltsin indicated the decree would limit financial companies to advertising only percentage gains they have achieved in the past, rather than the 600 percent to 1,000 percent earnings often promised in television and newspapers advertisements. "We have too many touters of every ilk, who promise fantastic dividends in the future or homes in Paris," Yeltsin said, referring to a commercial by the MMM Invest company.