RUSSIA: Energomash Says It Was Asked for $10M Bribe

Engineering company NPO Energomash, which makes rocket engines for
U.S. firm Lockheed Martin, said Thursday that it was approached for a
7 million euro ($9.9 million) bribe to reinstate its export

Energomash's export license was frozen in May for four months
following an Audit Chamber investigation. Shortly afterward, a lawyer
approached the company with a proposal to overturn the freeze in
exchange for the bribe, company spokesman Yury Korotkov said.

Energomash has a contract to supply Lockheed Martin with $500 million
worth of RD-180 engines, which the U.S. aerospace manufacturer uses to
power the booster stage of its Atlas III and Atlas V rockets.

Energomash has so far shipped 36 engines out of 50 engines provided
for by the contract, said Artur Belyustov, an aide to Energomash's
company director.

Korotkov said the company missed delivery deadlines after suspension
of its export license.

Lockheed Martin spokesman Scott Lusk could not immediately confirm
Thursday whether the company had experienced any delays in engine

Energomash's statement comes after the arrest this month of Defense
Ministry officer Yury Gaidukov on suspicion of extorting the bribe.
Gaidukov was in charge of the Audit Chamber inspection into the
company earlier this year.

The Audit Chamber on Thursday announced the detention of another
linked to the racket, the chief of its legal department Zarina
Farniyeva. The chamber also confirmed the arrests of two of Gaidukov's
associates -- Nikolai Serykh and Alan Gogichayev -- neither of whom
were Audit Chamber employees.

Audit Chamber chief Sergei Stepashin on Thursday vowed to root
corruption out of his agency.

"As I have said, the fight against swindlers and bribe-takers,
including those in the Audit Chamber, will continue," he said,
Interfax reported.

Energomash's account implicated only Serykh, naming him as the lawyer
seeking the bribe. The company reported the extortion attempt to the
Federal Security Service, Korotkov said. It also asked the government
and President Vladimir Putin to look into the license suspension,
Korotkov added.

Following an investigation by a Kremlin supervisory department and the
Security Council, Putin issued an order to unfreeze Energomash's
export permit, Korotkov said.

The group behind the bribery racket was arrested Sept. 6 after taking
an installment of 1 million euros in marked bills, the Audit Chamber
said in a statement.

A Federal Security Service spokesman could not offer immediate

The Federal Security Service has arrested another senior Audit
Chamber official and a regional official from Vladivostok on suspicion
of bribery, the chamber said Thursday, Reuters reported.

Audit Chamber chief
inspector Sergei Klimantov and Sergei Dubovitsky, first deputy mayor
of Vladivostok, were suspected of extorting a bribe from a commercial
AMP Section Name:War & Disaster Profiteering
  • 185 Corruption

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