Russia's missing billions revealed - FT.com Russia's central bank governor has lifted the lid on $49bn in illegal capital flight year - more than half of which, he says, was controlled "by one well-organised group of individuals" that he declined to name. Sergei Ignatiev, due to step down in June after 11 years in his post, is seldom outspoken about any issue other than interest rates. But he unburdened himself in an interview with the Moscow newspaper Vedomosti about money leaving the country through the back door, which he said equalled 2.5 per cent of gross domestic product last year. "This might be payment for supplies of narcotics . . . illegal imports . . . bribes and kickbacks for bureaucrats . . . and avoiding taxes," he told the daily, which is part-owned by the Financial Times. Russia's central bank has access to daily monitoring data on all payments within the commercial banking system, and Mr Ignatiev said the $49bn figure was mainly drawn from analysing "payments made by Russian organisations to non-residents, the stated aims of which are clearly false." He added: "Apart from this, our analysis shows that more than half of the total of shady operations is conducted by firms directly or indirectly linked to each other by payments. The impression is created that they are all controlled by one well-organised group of individuals. Mr Ignatiev also drew attention to the prevalence of what is known in Russian as "one-day firms," which operate as conduits for money transfers and then vanish before they pay taxes. He estimated that half of the 3.9m registered commercial organisations in Russia were inactive and "waiting for their hour to come." A Moscow-based economist, who asked not to be identified, said the schemes described by Mr Ignatiev were exactly those being investigated now in several jurisdictions in connection with the case of the lawyer Sergei Magnitsky, who died in police custody in 2009 after he attempted to track a fraudulent tax refund that appeared to benefit a group of bankers and law enforcement officers. "What Magnitsky was looking into - that was the tip of the iceberg," the economist said. Igor Yurgens, a former adviser to Dmitry Medvedev, the prime minister, said that if what Mr Ignatiev said about a "single organised group" was true, "such an operation would not be possible without serious support from law enforcement." Mr Ignatiev appeared to allude to somewhat lacklustre efforts by Russia's law enforcement agencies at tackling the problem, saying: "In the event of a serious concentration of effort by the . . . agencies, I think such people, and the beneficiaries of such operations, could be found." Sergei Aleksashenko, a former first deputy central bank governor from 1995-98, said the capital flight schemes spoken about by Mr Ignatiev could be deduced from the daily commercial banking data. He said: "It is easy to spot if you know what to look for." However, he pointed out, excessive diligence in bank supervision was hazardous to one's health in Russia. Mr Ignatiev's former deputy in charge of bank supervision, Andrei Kozlov, was shot dead in 2006 after launching a crusade to clean up the banking sector, revoking the licences of several banks. The head of a private bank, closed by Mr Kozlov for violating money laundering regulations, was convicted two years ago of ordering his murder. Mr Kozlov's successor, Gennady Melikyan, deputy governor of the central bank in charge of bank supervision, resigned for unclear reasons in September 2011. Acquaintances of Mr Ignatiev found his public revelations remarkable, adding that his decision to unburden himself about high-level corruption was probably connected with his forthcoming exit. "He usually doesn't make big public statements unrelated to monetary policy," said Sergei Guriev, rector of the New Economic School in Moscow, who serves on the board of state-owned Sberbank together with Mr Ignatiev. He is a very intelligent person of high integrity, and in closed-door meetings he is always very straight. Probably, he just believes that central bankers should not speak too much in public.