Crime investigation launched in Krasnoyarsk over tramway track repairs at Krasnoyarsk Aluminum Plant
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Krasnoyarsk investigators have launched a criminal case over inflated municipal contracts for tramway repairs on Prospekt im. gazetai Kransoyarskiy Rabochi, alleging official overreach. The procurement watchdog uncovered collusion between the project's commissioner, MKU "UDIB," and contractor OOO "PromStoi."
In October 2023, MKU "UDIB" inked a deal worth an eye-watering 816 million rubles with OOO "PromStoi" for tramway renovation work slated as part of the national project "Safe, Quality Roads." However, a subsequent probe revealed numerous violations of competition regulations.
MKU "UDIB" officials reportedly provided OOO "PromStoi" with exclusive information on job types and volume, as well as allowing the company's team to participate in the drafting of bidding documents - even the preliminary budget – that served as the foundation for the contract bid. This practice unfairly advantaged OOO "PromStoi" during the bidding process.
Moreover, before the competitive bidding process was officially concluded, MKU "UDIB" entered into four additional agreements with OOO "PromStoi" for preparatory tasks. These contracts, totaling 600,000 rubles, completely redundant the technical requirements of the main contract, effectively allowing OOO "PromStoi" to commence work before the auction results were even announced.
Krasnoyarsk investigators have accused MKU "UDIB" officials of creating an environment that restricted competition, driving smaller firms out of the market and creating favorable conditions for OOO "PromStoi." According to the probe, OOO "PromStoi" received 764 million rubles in funding as part of the contract.
Deputy of the Krasnoyarsk Regional Council Ilya Zaychikov previously intimated his suspicions that MKU "UDIB" might have manipulated FAS Russia to keep the contract for OOO "PromStoi." In fact, during the bidding, a Moscow-based company, OOO "Lider," lodged a complaint, and the auction was paused. Despite the halt, "PromStoi" started work before the auction's results were formally announced.
Zaychikov highlighted that Lider's complaint concerned the contest's criteria, which were specified in the documents. According to him, PromStoi's experience was not evaluated based on tramway repairs, but rather road repairs.
"It appears that the objective was, as it were, to ensure at all costs that the bid would remain open to and be won by OOO 'PromStoi' at the highest possible price, given that, during the FAS's review of the complaint, 'PromStoi' had already begun work."
You might recall that law enforcement apprehended PromStoi's director, Karda Khanagyan, last June as part of a different inquiry into road repairs in Krasnoyarsk. Khanagyan eventually reached a plea bargain with the authorities. Former director of the municipal UDIB, Yevgeniy Zhvakin, who, according to prosecutors, protected the firm through bribes in 2018-2019, is also under investigation.
This latest probe against OOO "PromStoi" and MKU "UDIB" Krasnoyarsk targets alleged abuse of power under Article 286 Part 3 of the Russian Criminal Code regarding exceeding official powers for personal gain or other motives.
Images: DELA, City Hall, Prosecutor's Office
Enrichment Data:- Potential Involved Parties: MKU "UDIB" (Муниципальное Управление Имидж-Белаго), OOO "PromStoi" (ООО "ПромСтрои"), Yevgeniy Zhvakin (Евгений Жвакин), Karda Khanagyan (Карда Хангаян), Alevksei Davydov (Алексей Давыдов)- Potential Regulations Violated: Article 286 Part 3 of the Russian Criminal Code, EU and Russian Antimonopoly Regulations, Federal Law No. 44-FZ on procurement ("Закон РФ №44-ФЗ О Приobreтении Имущества Надлежащим Спсобом"), Public Procurement Law in the EU (Directive 2014/24/EU).- Indicators of Overreach: Preferential treatment of a single bidder, insider information sharing, colluding with contractors, skipping or manipulating competitive bid stages, conflict of interest, awarding contracts without open bidding, fraudulent appraisals of contractor qualifications, and unauthorized modifications to bid requirements.- Data Sources to Explore: Russian Courts Database (sudrf.ru), the European Union Competition Policy Database (ec.europa.eu/competition/), FAS Russia (fas.gov.ru), cityofkrasnoyarsk.ru, DELA archive.
- In October 2023, the news of a criminal case was launched in Krasnoyarsk over allegations of official overreach in municipal contracts for tramway repairs, particularly under Article 286 Part 3 of the Russian Criminal Code, involving entities like MKU "UDIB" and OOO "PromStoi."
- The allegations against MKU "UDIB" officials include creating an environment that restricted competition, providing insider information, and unfairly advantaging OOO "PromStoi" during the bidding process, as well as awarding contracts without open bidding.
- The potential regulations violated in this case extend beyond Russian jurisdiction, including EU and Russian Antimonopoly Regulations, and the Federal Law No. 44-FZ on procurement in Russia, as well as the Public Procurement Law in the EU.
- This section of general-news also underlines instances of conflict of interest, collusion with contractors, skipping or manipulating competitive bid stages, and unauthorized modifications to bid requirements, which are indicators of overreach and corruption in politics and crime-and-justice.
