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. Last Updated: 07/27/2016

Banks Protest Ban On Private Security

A group of Russia's top banks has sent a letter to Interior Minister Anatoly Kulikov, protesting efforts to clamp down on their use of private security firms and to force them to rely on the police for their protection.

Alexander Zagryadsky, press secretary for the Association of Russian Banks, told Interfax that the Interior Ministry has banned registration of security services in commercial banks' subsidiaries and the acquisition of weapons by banking security services already operating.

While it was unclear exactly when this ban was imposed, Zagryadsky said the ministry has also recommended that the banks "deal with other security organizations, including the local Interior-Ministry agencies, to have their capital and other valuables protected."

The letter, reportedly sent to Kulikov on Tuesday, came one week after the interior minister had suggested that a number of Russia's largest commercial banks should be partially nationalized, along with top manufacturers and energy producers.

The letter was signed by the president of the Association of Russian Banks and the heads of seven commercial banks: Agroprombank, Vneshtorgbank, Mosbiznesbank, Vozrozhdeniye Commercial Bank, Promstroibank, Sberbank and Tokobank.

Promstroibank, Agroprombank, and Mosbiznesbank were among the five banks named by Kulikov as candidates for nationalization.

The letter's signatories are heads of commercial banks in which the state is already a large shareholder, said one banking official, who had seen the letter but asked that his name not be used.

The bankers' complaint to Russia's top police official concerns an Interior Ministry instruction from April 12, 1995, which made changes in the process of registering security services in bank affiliates and of obtaining weapons.

While the letter does not mention Kulikov's statements concerning nationalization, one top banking security official, who knew of the letter but requested anonymity, said Tuesday that the two events were linked.

"I think that for sure there is a connection, because the statement of Kulikov directly concerned the fate of the banks."

No one at the Association of Russian Banks could be reached for further comment Tuesday.

A spokesman for the interior minister said he knew nothing of the letter, as did representatives of Sberbank and Mosbiznesbank. An official reached at Agroprombank's security service declined to comment by telephone.

The letter, a copy of which was obtained by The Moscow Times, states that the Interior Ministry is "purposefully carrying out a policy of limiting and curtailing" the activity of bank security services, in violation of the 1992 law permitting private security and detective activity in Russia.

The authors of the document say banking security needs to be bolstered, citing an increase in "murders and kidnappings of bank employees, armed assaults on financial establishments and currency exchange points, fraudulent operations with falsified payment documents, embezzlement through bank computer networks, the chronic non-repayment of credits."

The Association of Russian Banks has often been at loggerheads with Russia's law enforcement agencies, accusing them of doing little to stop the wave of contract killings that have claimed the lives of dozens of top bankers and other leading businessmen over the last several years.

According to a study last year by the State Duma, the lower house of Russia's parliament, 25,000 private security firms are operating in Russia, employing a staggering 800,000 people. Some of the country's largest commercial banks reportedly have security forces made up of several hundred or more employees.

The head of Bank Imperial late last year told a newspaper that 60 percent of the bank's employees work in its security service.