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Top Prosecutor Orders Probe into Latest Kremlin Scandal

November 22, 1996

MOSCOW (AP) _ With plans to question President Boris Yeltsin’s top aides, prosecutors on Thursday began investigating an attempt to take a half-million dollars from government offices and a cover-up that allegedly followed.

The criminal investigation could further erode the credibility of Yeltsin’s government, which has been plagued by corruption allegations and power struggles.

Prosecutor general Yuri Skuratov said his deputies will question Anatoly Chubais, Yeltsin’s chief of staff and one of the Kremlin’s most powerful figures. He said officials including First Deputy Prime Minister Viktor Ilyushin and Alexander Korzhakov, Yeltsin’s former personal security chief, also will be interrogated.

The scandal began June 19, during Yeltsin’s re-election race, when two campaign officials were arrested while allegedly trying to take boxes of cash totaling $538,000 out of the government seat in downtown Moscow.

Chubais, then a top campaign aide, has denied the two were carrying any money and called the arrests a KGB-style provocation by political rivals _ among them Korzhakov.

Korzhakov and his allies in the government were ousted by Yeltsin a day later.

However, a supposed transcript of a June conversation between Chubais and Ilyushin alleges that the two agreed to hush up the arrests, which came just three days after the first round of voting.

According to the transcript, published last week by the daily Moskovsky Komsomolets, Chubais met on June 22, with Ilyushin, then Yeltsin’s top aide.

In the transcript, Chubais acknowledges his assistants were carrying the money and tells Ilyushin to arrange for the chief prosecutor to keep a lid on the investigation.

Chubais has flatly denied such a conversation ever took place and accused Korzhakov of being behind it. He also said the publication was ``part of an orchestrated campaign to discredit the president’s authority after Boris Yeltsin’s successful (heart) operation.″

Korzhakov has denied any role in the publication, saying he already was out of the Kremlin by the time the supposed recording took place.

The scandal is the latest salvo in the power struggle that has gripped Russian politics during Yeltsin’s absence from the Kremlin before and after the president’s heart bypass operation Nov. 5.

Chubais is the focal point of that struggle. He has become the closest aide of the secluded president _ and many Russians believe he is essentially running the country.

Yeltsin’s hard-line foes in the State Duma, parliament’s lower house, voted 267-3 last Friday to urge Yeltsin to ask the prosecutor general to speed up an investigation into the campaign aides’ arrest.

The two aides were released hours after their arrest and have not been charged with any wrongdoing.

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