By the Blouin News Politics staff

Mixed motives behind Putin’s call for white-collar amnesty

by in Europe.

Russia's President Vladimir Putin attends the St. Petersburg International Economic Forum June 20, 2013. REUTERS/Dmitry Lovetsky/Pool

Russia’s President Vladimir Putin attends the St. Petersburg International Economic Forum June 20, 2013. REUTERS/Dmitry Lovetsky/Pool

In a surprise move at the St. Petersburg International Economic Forum, Russian president Vladimir Putin strongly encouraged legislators in the State Duma to pass a law amnestying a wide range of economic crimes. Speaking on June 21, he described this as an “act of humanity” and part of a “reset” with society.

The proposed law would pardon those with first-time convictions for economic crimes who either have or are willing to reimburse their victims. As such, it would exclude Russia’s highest-profile economic detainee, former oil magnate and Putin critic Mikhail Khodorkovsky, as he was convicted twice, in 2005 and 2010.

Putin urged the Duma to pass the law before it recesses for its summer vacation, on July 14 (it could conceivably consider it as early as July 5). The proposal is not uncontroversial. Already, Andrei Kostin, head of VTB, Russia’s second-largest bank, has argued that what the country needs is tighter, not looser economic controls. However, given the extent to which the legislature is dominated by the Kremlin, there seems little doubt that Putin will get what he wants. What is less clear is quite why Putin suddenly took this position.

An amnesty had originally been mooted by Boris Titov, the business rights ombudsman, who had said that there were 111,000 businesspeople in prison who were largely either no threat to society or else who had been forced into breaking the law by flawed and overly strict financial regulations. However, the scale of the proposed amnesty has been scaled down in successive drafts and would now cover around 10,000 individuals.

In this respect, the amnesty would seem to address a number of objectives. It helps present Russia as a more business-friendly country (at present it languishes at 112th place in the World Bank’s Ease of Doing Business survey). It reaches out to the new creative and entrepreneurial class who make up a significant proportion of the anti-Putin protest movement. And it eases the pressure on Russia’s overcrowded and dangerous prisons.

It may also allow the government to push through a conviction in its current, and controversial, trial of protest figurehead Alexander Navalny on fraud charges. A guilty verdict would bar him from standing for office—the Kremlin’s main aim—while an amnesty would spare it from the negative international response to jailing such a figure.

Finally, the proposal also reflects behind-the-scenes maneuvers within the Russian security apparatus. Investigations Committee chief Alexander Bastrykin wants to create a specialized finance police that would report to him. The main internal security agency, the Federal Security Service (FSB), is suspicious of Bastrykin’s empire-building. It is trying to block this initiative, but is now backing the amnesty as a fallback. So if Bastrykin does get his new force, this would at least narrow its scope.