On April 29, 2006, the Russian State Prosecutor’s Office (Generalnaya Prokuratura) announced that it had completed the official investigation of former Minister of Atomic Energy (1998-2001) Yevgeni Adamov, who faces charges of embezzling three billion rubles (approximately $100 million). According to Russian law, Adamov and his lawyers will now prepare their defense (a process that could take many months), after which the trial date will be set. [1]

Other defendants in the same case include Vyacheslav Pismennyi, the former director of the State Research Center “Troitsky Institute of Innovation and Thermonuclear Research,” and Revmir Freishut, the former Director General of TechSnabExport, a state-owned nuclear fuel exporting company. An international arrest warrant has been issued for a fourth defendant, Aleksandr Chernov, the president of Nuclear Services and Supply Ltd, a Swiss company operating in the United States, which was created by TechSnabExport in 1991 to market Russian products. [2]

The charges in the case are centered around the ownership of Global Nuclear Services and Supply (GNSS). GNSS was created by TechSnabExport, in part, to serve as an intermediary in the “Megatons to Megawatts” agreement, under which highly-enriched uranium from Russian nuclear warheads is converted in Russia into non-weapons-usable nuclear fuel and then sold in the United States. When the firm was established, TechSnabExport held a controlling share of its stock, but this diminished over time. [3] According to the indictment, Adamov, Pismennyi, Freishut, and Chernov illegally acquired 62 percent of GNSS; Pismennyi, in addition to holding the directorship of a Russian research center, was also chairman of the board of GNSS. This operation was considered illegal because any privatization of TechSnabExport is banned by Russian law. The indictment estimated the value of 62 percent of GNSS at three billion rubles (roughly $106 million in mid-2000). [4]

The indictment unveiled by the Russian State Prosecutor’s Office is different from that predicted in earlier media reports, which were based on leaks from investigators. Earlier reports, for example, anticipated that Adamov and his colleagues would be charged with embezzlement of $31 million – roughly one-third of the amount in the final indictment. In addition, one possible defendant, Vladimir Vinogradov (Adamov’s principal deputy at Ministry of Atomic Energy) was dropped from the case. [5]

The case of GNSS represents only part of a much larger set of allegations regarding Adamov’s illicit commercial activities during his tenure as director of NIKIET (the Russian acronym for the Moscow-based Scientific Research and Design Institute of Energy Technology), particularly from 1993 to1998, and as Minister of Atomic Energy. These emerged after a special investigation conducted by the Anti-Corruption Commission of the State Duma (the lower house of the Russian parliament) in 2000-2001, which led to Adamov’s retirement. [6] At that time, however, the State Prosecutor’s Office chose not to open a formal investigation.

The situation changed in May 2005, when Adamov was arrested in Switzerland at the request of the United States, following his indictment by U.S. prosecutors in Pennsylvania. They charged Adamov with embezzling $9 million in international nuclear assistance funds for Russia, specifically to provide safety improvements for Soviet-designed RBMK reactors (the type involved in the Chernobyl accident). Almost immediately after Adamov’s arrest in Switzerland, the Russian State Prosecutor’s Office filed its own charges in Moscow and demanded his extradition to Russia. The Russian extradition request was widely seen in Russia as a means of preventing the possible leak of highly sensitive information about the Russian nuclear complex to the United States once Adamov was in U.S. custody.

Initially, the Swiss trial court responsible for the case decided Adamov should be extradited to the United States, but his defense appealed that decision, and at the end of 2005, the Supreme Court of Switzerland ruled that Adamov should be extradited to Russia instead. The court decided that because Adamov was a Russian citizen, Russia had priority in prosecuting him. The court did not reject the American extradition request, however, but merely ruled on the sequence of prosecution. [7] Adamov was transferred to Russian authorities on the last day of 2005. [8] Theoretically, after his trial in Russia, Adamov can be required to stand for a second trial, following extradition to the United States, on the American charges.

Since his extradition from Switzerland, Adamov has remained in a Moscow jail while his two co-defendants (the third is still at large outside Russia) have been released pending trial and prohibited only from leaving their cities of residence. Three times, in January, April, and May 2006, Adamov’s defense petitioned Basmannyi District Court, in Moscow, for his release on bail, but each time the petition was refused. [9] An appeal of the April extension of his incarceration was rejected by the Moscow City Court. [10] Under the latest ruling, he will remain in jail until August 8, 2006, and a new appeal is likely. [11] Adamov reportedly also intends to sue Switzerland in the European Human Rights Court, in Strasbourg, for illegal arrest. [12]

Arguments made by Adamov’s lawyers at bail hearings suggest that during the future trial his defense is likely to claim that charges against their client are politically motivated. “The State Prosecutor’s Office was only an instrument in a scheme of extracting Adamov from Switzerland,” declared Henry Reznik, a well known lawyer defending Adamov during the court hearing. [13] This line of defense, if successful, risks landing Adamov in a U.S. court, however.

The behavior of Russian authorities, including at the bail hearings in the Moscow court, has demonstrated that the government apparently intends to proceed with its prosecution and is not willing to release the former minister under some pretext. Under existing law, Adamov, now 67, might be sentenced to seven years in prison.

It should be noted, however, that notwithstanding the Russian and U.S. charges against Adamov, many former colleagues and subordinates in MinAtom (now RosAtom) retain a positive view of their former chief. Among other reasons, during his tenure the Russian nuclear industry began to grow and became more market-oriented; salaries and bonuses for employees also increased dramatically compared to the situation under Adamov’s predecessor, Viktor Mikhailov. [14]

Adamov’s indictments in Russia and the United States for misappropriation of funds provided to support U.S. nonproliferation and nuclear safety programs in Russia and for illegally privatizing a state-owned Russian company charged with implementing an important U.S. nonproliferation assistance program raise a number of troubling issues. Perhaps most important is whether Adamov’s alleged self-dealing influenced the implementation of U.S. nuclear safety and nonproliferation programs in Russia during his tenure at NIKIET and as Minister of Atomic Energy. Among other possibilities is that his private behavior may have reduced the flow of safety assistance for Russian nuclear power plants or may have influenced Russia’s negotiating position on those aspects of the “Megatons to Megawatts” program, where GNSS played a major role.

As new information emerges in the Adamov case, U.S. decision-makers may need to revise their understanding of Russian nuclear policy during the years of his leadership and, if abuses occurred, look for mechanisms to help avoid them in the future.

On June 1, 2006, Adamov had a heart attack, said to be his third during his incarceration. Although unable to walk, he was not immediately transferred to the prison hospital, according to official sources. [15]

Nikolai Sokov – Monterey Institute Center for Nonproliferation Studies