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

. Last Updated: 07/27/2016

Mabetex Head Says Kremlin Owes $57M

The president of Swiss construction firm Mabetex accused Kremlin property manager Pavel Borodin of failing to repay $57 million in debts to Swiss and British investors, the Russian daily newspaper Vedomosti reported Thursday.

Beghjet Pacolli said the Kremlin had already missed four payments on the loans, which were used to renovate the Kremlin-owned Swiss Diamond Hotel on Smolenskaya Ploshchad in central Moscow, and that it is obvious that "no one is planning to return" the money, he told Vedomosti.

Pacolli, who has been at the center of the intensifying corruption allegations against President Boris Yeltsin's administration, said he was planning to sue the Kremlin for the unpaid debts and that his team of lawyers had already begun the process, the newspaper reported.

A spokeswoman for Pacolli on Thursday confirmed the interview with Vedomosti took place, but refused any additional comment. Pacolli was unavailable for comment.

Borodin's press office refused to comment, saying they had no information about Pacolli's accusations.

On Thursday, Switzerland's federal court publicly revealed a Russian prosecutor's allegations that Borodin received $11 million in kickbacks from Mabetex - 11 times more than the amount previously disclosed - in payments to a numbered, secret Swiss bank account. The name of the accused was blacked out, but the Federal Tribunal court papers made it clear that it was Borodin, The Associated Press reported.

The court also said the Russian Prosecutor General's Office has accused Mabetex of overcharging the Kremlin by 30 percent to 50 percent to cover the cost of the kickbacks.

Swiss authorities raided Mabetex headquarters in Lugano, Switzerland, in January in connection with suspicions that several high-ranking Russian officials, including Borodin, had received bribes for helping the firm get the lucrative contracts for renovating Kremlin properties, beginning in 1994.

The Kremlin and Borodin have repeatedly denied any wrongdoing.

Earlier this week, investigations into the Mabetex case resumed as Ruslan Tamayev, the prosecutor's investigator for particularly important cases, summoned journalist Oleg Lurye of the Russian weekly Versia for questioning over an article claiming to have proof that Borodin, Yeltsin and Yeltsin's daughter, Tatyana Dyachenko, had Swiss bank accounts.

The paper printed copies of what it said were Banca del Gottardo account ledgers bearing the signatures of Borodin and Yeltsin. The bank denied the accounts ever existed and said the documents were fabricated. Lurye, however, said he was "99 percent" sure of their authenticity, Interfax reported.

The Versia article also cited unidentified sources at Banca del Gottardo as saying $11 million had passed through the Yeltsins' and Borodin's accounts - the same amount Russian prosecutors allege Mabetex paid the Kremlin in bribes.