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. Last Updated: 07/27/2016

Shaking Down Gas Customers

President Vladimir Putin and the team of "St. Petersburgers" he has installed in the top echelons of government could soon find themselves embroiled in a financial scandal involving tens of millions of dollars and pretty much the entire Russian economy. Everything now depends on the results of an audit that Gazprom chief Alexei Miller has ordered of the gas giant's largest subsidiary, Mezhregiongaz, which holds a virtual monopoly on natural gas sales within Russia. As part of a major purge at Gazprom last winter, Mezhregiongaz was taken over by a new management team headed by Nikolai Gornovsky.

The audit apparently came in response to a letter penned by Anatoly Chubais, in which the Unified Energy Systems boss accused the Mezhregiongaz leadership of inflating prices and forcing customers to buy their gas through intermediaries.

"The results of [numerous] audits point to the dubious reputation of these intermediary companies," Chubais wrote. "Regional gas suppliers force [their customers] to sign contracts [with these companies] as a condition of making additional deliveries. The inclusion of such intermediary firms has cost regional energos more than 500 million rubles in losses."

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The main thrust of Chubais' letter was laid out for me by a number of the people involved. Here's how it works. Gazprom owns the gas. The price of Gazprom's gas is fixed by the Federal Energy Commission. Mezhregiongaz's basic function is to sell that gas -- more than 300 billion cubic meters per year -- and collect the money.

Say the manager of factory "X" pays a visit to his regional gas supplier. He enters the director's office: tables, chairs, a portrait of Putin on the wall. "Give me my 1.5 billion cubic meters of gas," he says.

"Sorry, pal," the director replies. "We can't handle that kind of volume. We'll deliver two-thirds of that. You'll have to buy the rest from an independent producer."

Chubais' letter contains a list of such producers: Petrostroikomplekt, Resurs, Energia-kholding, Admi-servis, Nafta-tsentr, Gazinfosoft.

The factory manager's jaw drops. "What are you trying to pull? The gas is yours. It belongs to Gazprom. Why should I pay half again as much for it when the difference just gets skimmed off by the middle man?"

The gas company functionary points to the portrait of Putin hanging on the wall behind him. "Orders from upstairs. We're collecting for the election campaign."

This scenario, with a few variations, was described to me by a number of people -- factory directors, not small fry. Oligarchs and such.

They might all have been lying. They might have wanted to discredit Putin's St. Petersburg team in the eyes of a journalist. But there were just too many factory directors, often mortal enemies, all telling me the same story, and not for publication. No one wanted to be interviewed on the record. "No way. Best not to get mixed up in that," they said.

It's also worth noting that all of these sources made clear that they understood the election fundraising story was just a scam. Admi-servis isn't raising any money for Putin's re-election campaign. Some factory directors refused to pay. Those who agreed got the gas they needed -- from 12 to 30 percent of their allotment -- at prices up to one and a half times the official rate.

We're talking about tens of millions of dollars.

If Chubais' letter tells the true story, and if what my sources have told me checks out, then top officials of one of the biggest companies in Russia have been shaking down their customers for nine months now on behalf of Admi-servis. When this sort of thing is done under the table, it's called a swindle. When it's done by one of Russia's biggest companies and the team tasked with cleaning up Gazprom, I don't even know what to call it.

So far as I know, the real reason behind Miller's decision to order an audit of Mezhregiongaz had less to do with Chubais' letter, and more to do with the astonishment of the more liable members of the St. Petersburg team.

You have to choose: Either you strengthen the top-down power structure, or you serve the corporate interests of Admi-servis.

Yulia Latynina is the author and host of "Yest Mneniye" on TVS.