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. Last Updated: 07/27/2016

No Proof Bank Exec Passed Secrets




WASHINGTON -- The World Bank said this week that an eight-month investigation found no evidence to support allegations that a former Russian representative at the World Bank passed confidential information to a Russian commercial bank in 1993.


The bank concluded that the representative, Leonid Grigoriyev, had set up a business relationship with Inkombank, which is now defunct, and that he received $13,000 for out-of-pocket expenses from the bank in 1993. A bank official said that while the relationship did not violate World Bank rules, the bank did not consider it acceptable activity for one of its executive directors.


Grigoriyev's actions were the subject of articles in The Wall Street Journal, The New York Times and other publications in the fall of 1999. Some of the articles, which explored issues related to an investigation into how billions of dollars in suspect Russian money flowed through the Bank of New York, raised questions about Inkombank's operations.


On Oct. 22, 1999, The Wall Street Journal reported that the World Bank was investigating Grigoriyev's ties to Inkombank. The newspaper cited a memo purportedly written by Grigoriyev to Inkombank officials that discussed ways for the bank to profit from the Russian bond market. It reported that the memo was labeled "strictly confidential" and that it contained sensitive debt-market investment advice.


Lending to Russia by the World Bank and the International Monetary Fund, its sister agency, was considered crucial to the health of the country's bond market at the time.


World Bank officials said they began investigating Grigoriyev only after The Wall Street Journal provided them with a copy of the memo.


The New York Times reported last January that the memo may have been a fake provided to The Wall Street Journal by Emanuel Zeltser, an ?migr? Russian lawyer who became a source of information about Russian money laundering. The New York Times report examined Zeltser's role in spreading allegations about matters that were tangential to the money-laundering investigation.


Merrell Tuck, a World Bank spokeswoman, said Friday that bank officials and an outside law firm hired to lead the bank's investigation were "unable to authenticate" the memo. Because the bank could not determine if the memo was genuine, it found no evidence that Grigoriyev passed sensitive information to Inkombank while working at the World Bank, she said.


Grigoriyev left the World Bank in 1997. When the World Bank began an investigation into his conduct last fall, he was put on leave from his job as director of the Bureau of Economic Analysis, a Moscow-based research center that receives World Bank funding.


The bank said in a statement this week that the payments Grigoriyev received from Inkombank would "prejudice against" any employment he might seek at the bank itself for the next three years.


But it said it now has no objections to Grigoriyev resuming his post at the research institute.


"The World Bank has informed Russian officials that the bank has no objection to the lifting of Grigoriyev's administrative leave," the bank statement said.