Sixty one percent of respondents from Russian companies who fell victim to economic crimes said that from one to 10 fraud cases had been noted in their companies, 39% of respondents noted more than 10 incidents. The deteriorating situation on the global markets due to the economic downturn was named as the most probable reason for the increasing rate of corporate fraud. As shown on the graph, the most common type of economic crime in Russia is misappropriation of assets (64%); meanwhile, high levels of bribery and corruption (48%, which is twice the global rate) remain the hallmark of the Russian Federation. According to 62% of respondents, fraudulent activities were conducted with assistance from external parties. According to PwC, it is probable that this is due to the fact that Russia’s business is increasingly relying on brokers and agents.

According to some estimates, corporate losses due to fraudulent activity amount to up to 7% of revenues. According to the 2009 survey, 43% of respondents noted greater losses due to fraudulent activity in the last year. For 47% of companies, these losses exceeded $1 million (the remaining companies suffered losses less than $1 million). The greatest losses are endured by large companies (more than 5,000 employees) in the financial services, fuel and energy, and mining industry sectors. According to the survey, companies have become less tolerant toward those engaging in economic crimes. In the struggle against the perpetrators, dismissal is the preferred method of punishment (57%). Before, this figure had been substantially lower: 25% - in 2007 and 15% - in 2005. Meanwhile, 33% of respondents have initiated civil and criminal law suits.

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So far, a small positive trend has been noted in the mortality decline. In 2003, 35,600 people died in traffic accidents, in 2008 that number dropped to 29,900. In the same period, the number of accidents remained the same (204,000 and 218,000), and the number of victims increased from 243,900 to 270,900 (the highest number – 292,000 – was recorded in 2007). The rate of highway fatalities in Russia (22 deaths per 100,000 inhabitants) is significantly higher than that of Germany (5.9), France (7.3), and Latvia and Lithuania (15.9 and 16.8, respectively). Since 2003, highway fatalities in our country have decreased by only 10%, whereas in Germany they have decreased by 25%, France - 16%, and in our Baltic neighboring countries – by nearly 30%.

Part of the problem is in the rapidly growing number of motor vehicles. In 2003-2008, Russians purchased more than 5.9 million new and 2.2 million used foreign-made cars, as well as nearly 4.7 million domestic cars. But, according to statistics, only foreign vehicle purchases help lower fatality rates due to the fact that they meet the current safety requirements. In Moscow, there is one death for every 16 accidents (almost as in France), in Primorsk and Khabarovsk Krais – every one in eight accidents is fatal.

In places where drivers tend to use the products of the domestic automobile industry, the mortality risk is much higher: in Krasnodarsky Krai, every one in six accidents is fatal.

Officials blame undisciplined drivers and poor education in driving schools for the high rate of traffic accidents and fatalities. However, experts are naming other reasons: our roads are too narrow and are unsuitable for the increase in traffic. The state failed to provide the increasing number of vehicles in improved infrastructure, and it is not due to a lack of finances. In 2006-2008, about 1.1 trillion rubles ($40 billion) was allocated for the federal highway target program, “Development of the Transportation System". However, roads of federal importance were extended by only 3,000 km, of which highways were extended by 1,000 km.

The state displayed an inability to build high-quality modern roads; it is allowing officials to overlook traffic rules and create dangerous situations. "Passengers’ safety is above this [traffic jams and accidents],” said Gen. Viktor Kiryanov, STSI (State Traffic Safety Inspectorate) chief.

It is possible to reduce the number of casualties, for example, by enabling an easier access to quality vehicles, which are equipped in a way that can save the driver’s life in the event of a serious accident. Or, by installing built-in breathalyzers in cars, thus serving state and security services officials.

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Financial pyramids of the 17th century

Argumenty i Fakty: Vladimir, the numerous discussions about the crisis and the countless predictions on its development made ordinary citizens nothing but confused. In your opinion, what is the main myth about the crisis that became rooted in the consciousness of society?

Vladimir Medinsky: The main myth is that the crisis is over. Kudrin’s statements that Russia has finally come out of the recession are far from reality. Moreover, talks about this being the first world-scale financial cataclysm should be added to the group of other great misunderstandings. In the last century the world had experienced crises that were far more severe. The Great Depression of the 1930s was also global in scale. The Wall Street crash and the marches of the homeless on Washington, the financial collapse in Europe, Nazification of Germany, war in Spain and China, starvation in Ukraine, Kazakhstan and central USSR – all of that was also related to the global depression.

The Soviet Union, of course, experienced at that time somewhat differently than other countries because, at that time, it was not a part of the global economy – to a certain degree, that fact was to our advantage.

“AiF”: You say that Russia, like other countries, suffered a number of financial crises which, today, have been forgotten. If we were to look far back in history, in what period could we find a first mention of economic cataclysms?

V.M.: The entire history of civilization is, in fact, the history of financial crises. If one were to dig deep enough, I am sure that notes on economic setbacks could be found in the writings of ancient Sumerians. But, the further we look, the more we see politics and economics intertwine. As far as the Russian crises, the first ones that come to mind are the Copper and Salt Riots of the 17th century.

After all, what was the Copper Riot, for example? Today, it would be considered a financial crisis caused by the unwise monetary policies of the government. And the Salt Riot was provoked by unwise tax policies against the background of a difficult war with Poland. Or, take 17th century Holland as an example – I am talking about the “tulip fever”: that was an attempt to find a new equivalent to gold. Alas, the attempt was unsuccessful; it compromised one of the most developed European economies of that time. The history of British, and partly French, economies of the 18-19 centuries with all the “Lousianas”, “Panamas” and “tropical sea campaigns” – are all financial pyramids typical of those that we have experienced in the daring 1990s. Thus, only the undertone and magnitudes of economic shocks change.

Our civilization and its economy – are a single organism. And a crisis is like a flu for this organism. If the illness were to be treated correctly, then the organism will finally grow immune.

The “suffering” of the oligarchs

“AiF”: Speaking of magnitudes: if I understand correctly, only two crises – the U.S. crisis of the 1930s and the current one – are global in character. Is that correct?

V.M.: Yes, but not quite. Let us remember the times of Pericles in ancient Greece. Silver mines were opened in the territory controlled by Athens. This resulted in this polis-state having an abundance of silver coins. Sparta, which, at that time, had a closed monetary financial system (much like the USSR, which had a non-convertible ruble), understood, that from then on, that its entire system of isolated existence would be threatened. Then, the Spartan government, firstly, prohibited the circulation of Athenian currency on its territory, and secondly, released new unique currency – large metal or stone disks resembling pancakes or rods. When taking a trip to the market, a Spartan would bring along a couple of slaves-helots who rolled his "wallet" in a cart. But, the new currency had its pluses: it was impossible to steal such money, one could not offer it as a bribe, and black-marketeers would face many difficulties as well. Moreover: they were always in sight; therefore, they were a tax declaration in themselves. Today, this seems amusing; but in those days, this was an attempt to keep the banking system independent from foreign influence, an attempt to dissociate from a so-called “all-Greek WTO”.

“AiF”: Who suffers more in the time of crises: the rich, as it is customary to believe, or those living from paycheck to paycheck?

V.M.: In any financial shock, the rich get richer and the poor – poorer. During the Great Depression, for example, America’s wealthiest families bought the property of their competitors. The published rating of our oligarchs, “who suffered most”, did not lack in irony. It is clear that they have not lost anything. Moreover, many are shamelessly trying to get rich at the public expense. In fact, all that has changed is simply the virtual evaluation of their assets. No one lost their key assets. If, say, their possessions were nationalized, seized for banks’ debts, and the oligarchs, who lost their factories, newspapers, steamships as well as yachts and soccer clubs, got buried in long-term debt – then one could say – yes, they have suffered.

Dossier

Vladimir Medinsky was born in 1970 in Smela, Ukraine. He graduated from the Faculty of International Journalism at MGIMO. He has a Ph.D. in political science, is a professor at MGIMO, and a State Duma deputy.

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