The Oligarchs (62 page)

To get to the other shore, Yeltsin also needed the oligarchs—he needed their March “wake-up call,” their media bullhorns, their talented staff, and their money-laundering abilities. They helped amplify his message, discredit Zyuganov, and bring off a victory. The oligarchs saved Yeltsin to save themselves, and he allowed them to do it. Both also believed they were saving Russian capitalism, and they were. Yeltsin won 35.28 percent of the first-round vote, to 32.03 for Zyuganov, 14.52 percent for Lebed, and 7.34 percent for Yavlinsky. The results forced Yeltsin and Zyuganov into a second-round runoff. Yeltsin fired his unpopular defense minister and gave a new Kremlin post to Lebed in order to attract more voters to his side. The campaign staff began planning for a vigorous final assault that included a heavy schedule for Yeltsin. Then Yeltsin's roller-coaster ride of 1996 took another terrifying nosedive.

 

Four days after the vote, two campaign officials left the Russian White House at about 5:20 P.M. The first to walk out was Lisovsky, the entertainment and advertising mogul, who was carrying a Xerox box wrapped in white twine. He was stopped at guardhouse 2, a small structure through which visitors enter and exit the fenced compound. The guards asked Lisovsky if he had a pass for the box. He did not. They asked to see the box.

At that moment, a final, climactic confrontation between Chubais and Korzhakov began. For months, ever since Yeltsin had decided to go ahead with the elections, Korzhakov had been growing increasingly restive. In early May, Korzhakov admitted to a reporter for the
Observer
of London that he wanted to call off the elections, and Yeltsin quickly put him in his place.
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Yeltsin said Korzhakov would stick to his duties as a bodyguard, and the campaign would go on.

Korzhakov knew the Chubais team was carrying big money around in gym bags and suitcases; in fact, his presidential guards were also
ferrying around cash, “driving money around the whole country in suitcases.”
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The argument with Chubais was, in fact, about more than campaign money. Korzhakov said he saw himself as a champion of “Russia and the state,” and his rivals as “a camp of those who wanted to sell and rob this Russia.” The Chubais group saw the opposite: Korzhakov as a power-crazed reactionary who did not understand democracy or capitalism.

Korzhakov set a trap for the Chubais group. The details of the trap remain partly obscure, but the existence of a trap is not in dispute. Korzhakov and one of his deputies, Valery Streletsky, later boasted they had engineered the net. Streletsky has claimed he bugged the room where Chubais aides kept the cash in the Russian White House and lay in wait for someone to come for it.
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Lisovsky told me that Korzhakov's team had been planning the trap for two months.
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Yeltsin said in his memoir it was Korzhakov's “final counterstrike.” The chief of the presidential bodyguards “had been spoiling for a scandal, and now he had found one.”

The box contained $500,000 in neatly wrapped U.S. dollars. Minutes after Lisovsky was arrested, Yevstafiev, the Chubais aide, walked out of the White House and into the same guardhouse. “I saw people standing with Sergei [Lisovsky] with guns,” he recalled. Yevstafiev added that he heard someone tell Lisovsky to take the box, that Lisovsky was bending over and Yevstafiev warned him not to touch it. Yevstafiev was also detained. Both men were taken to closed rooms, their mobile telephones were taken away, and Streletsky's men began to interrogate them.

When both Yevstafiev and Lisovsky disappeared, the campaign headquarters started looking for them. Yevstafiev had left word with his office that he was going to the White House and would be back in an hour. When he failed to return, they grew worried. They found him under armed guard—by Korzhakov's men. “The men with guns had the order to shoot if necessary,” Yevstafiev recalled. They offered to give him an injection for “high blood pressure,” which he firmly refused, suspecting it was something else.

About an hour later, a third man, Boris Lavrov, a commercial banker, was found in the room with the safe by the Korzhakov guards and was questioned also. He had another $38,850 in his briefcase. He told interrogators that Lisovsky had come to the room with Yevstafiev, and that Lisovsky took the box with the $500,000 and signed a receipt for it.
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The tycoons and campaign staff were already gathering for a previously scheduled meeting at Berezovsky's Logovaz Club that evening. But as they pulled up to the building on Novokuznetskaya Street, they were under a watchful eye. Korzhakov had put the building under conspicuous surveillance from unmarked cars and rooftops. Zverev, the Gusinsky lobbyist, recalled that the campaign constantly worried about Korzhakov. “We had the impression something was going to happen,” he said.
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Still, Chubais wasn't sure Korzhakov would go so far as to arrest his campaign staff. “Until the last moment, I couldn't believe that Yevstafiev was arrested,” he recalled later. “It seemed absolutely impossible to me.”

Once again, Chubais exhibited nerves of steel. From Berezovsky's elegantly appointed mansion, he picked up the phone. It was now late in the evening. He could not reach Korzhakov, and Yeltsin was asleep and could not be awakened. His anger rising by the minute, Chubais finally reached Barsukov, the head of the Federal Security Service. Barsukov was a weak figure who had been overpromoted by his pal, Korzhakov.

“I told him I would destroy him,” Chubais said. “I promised him that. I would destroy him if a single hair fell from Yevstafiev's head.” Unexpectedly, Barsukov quickly backpedaled. “He was saying, ‘It was no big deal, we are holding him temporarily, another thirty minutes, then everything will be all right. Just don't worry.'”
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Kiselyov, the NTV founder and anchor, got a call at home and was told by Malashenko to rush to the television studio and “be prepared to stay on the air throughout the night.” Malashenko was both Kiselyov's colleague as president of NTV and Yeltsin's campaign media boss. NTV went on the air after midnight with news of the arrest, portraying it as a trap set by Korzhakov. Kiselyov appeared, announcing an “emergency” news bulletin, and reminded viewers that Korzhakov had admitted in May he wanted to call off the elections. “It looks like the country is on the brink of a political catastrophe,” Kiselyov said. “I would like to wish you a good night, but I cannot.”
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The final countdown had begun: one group or the other was going to be sacked in the morning. Kiselyov then went to the Logovaz Club, where he found anxiety rising. Gusinsky, Berezovsky, Chubais, Zverev, Yumashev, Dyachenko, and the liberal governor of Nizhny Novgorod, Boris Nemtsov, all milled about. Zverev said, “I went away to destroy some documents because there could be some arrests that night.”

“Everyone understood,” Kiselyov said, “that tomorrow morning,
Korzhakov would go to Yeltsin and say, ‘Look, Boris Nikolayevich, these guys whom you trust so much are crooks. They are stealing money, in cash, from under your nose. They are just bringing it in empty Xerox boxes from the very building where the government sits, and you have to decide, finally, who you trust.”
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That was, in fact, exactly the Korzhakov plan.

“Everybody was very frightened,” Kiselyov recalled. “It's not as if people were trembling—no one said it openly, no one confessed—but I had a feeling that some of the people gathered in the Logovaz mansion were afraid to leave. They were thinking, I could be arrested.” Kiselyov said that Dyachenko's presence through the night gave them confidence that they were safe, inside the Logovaz Club at least. “Korzhakov would not dare” storm the building with Dyachenko inside, he assumed.

But even as they waited anxiously in the Logovaz Club, Gusinsky and Berezovsky had in their hands a weapon more powerful than Korzhakov's presidential guards. Their television station broadcasts in the middle of the night had electrified the political elite in Moscow and underscored how close the oligarchs had bound themselves to Chubais and Yeltsin. The campaign staff, the businessmen, and the broadcasters were all on the same team.

At 1:00 A.M., after Chubais reached him by phone, Lebed tried to call Korzhakov and Barsukov on a special top-secret Kremlin phone system, S-1 and S-2. No answer. Lebed then deployed his cannon-sized voice and vivid vocabulary on behalf of the Chubais team in a televised statement. “Attempts are being made to wreck the second round; that is my first impression,” Lebed said. “Any mutiny will be crushed and crushed with extreme severity. Those who want to throw the country into the abyss of bloody chaos deserve no mercy at all.” Lisovsky and Yevstafiev were released about 3:00 A.M., after ten hours of interrogation. Their captors were unnerved by the television broadcasts. Chubais later told me that television proved to be the key element in the whole affair.

The race was on to get to Yeltsin, but he slept through the night, hearing about the confrontation only in the morning from his daughter. Bleary-eyed, the Chubais team gathered at an office in the tower where Gusinsky had his corporate headquarters. Just outside was the parking lot where Korzhakov had forced Gusinsky's men to lie facedown in the snow. It was decided that only Chubais could persuade
Yeltsin to save them, just as Chubais had talked Yeltsin out of canceling the election two months earlier. Chubais had reached Yeltsin in the morning on a phone with a direct line to the Kremlin.

“When I talked to him on the phone, he said nothing terrible had happened,” Chubais remembered, “that people had tried to steal money, but everything was in order now. ‘We won't allow anyone to steal money. Don't worry. Everything is all right.' I told him that no, it wasn't all right, that the situation was absolutely catastrophic, and I absolutely had to meet with him. He really didn't like that. Nevertheless, he set up a time.”

Edgy and exhausted, the Chubais team felt the outcome was wildly unpredictable. Quite possibly, they were losing out to Korzhakov. They would be fired from the campaign, arrested, and jailed. But they were cheered up when Yumashev made a surprising guess about what Yeltsin would do. “Boris Nikolayevich is going to fire Korzhakov,” he predicted. “I don't know why, but I have known Yeltsin for a long time.” The others were startled. “Many of us were so tired that we were not quite aware of what was happening around us,” Kiselyov recalled, but Yumashev's statement made an impression on everyone. Zverev told me, “Yumashev whispered, ‘He's going to fire them.' We were shocked. No one believed him because we were sure that
we
were going to be fired.”

Chubais went to see Chernomyrdin, who had cautiously kept his distance from the warring camps. Chubais came out with all guns blazing. This was a do-or-die situation, he screamed at the Russian prime minister. Chernomyrdin kept very quiet. “I simply told him that the time had come to say his word,” Chubais recalled. “He had kept quiet for five years, and now it was, either say everything in an hour, or you will be destroyed tonight. There was no middle ground left, no middle whatsoever. You have two hours. If after this you don't go to the president, and don't say it is either ‘me or them,' you are a piece of shit. You don't exist any longer.”

Chubais next bumped into Chernomyrdin a few hours later in the anteroom of Yeltsin's office. Chernomyrdin looked at Chubais and reported, “I've said it all to him.”

When he entered Yeltsin's office, Chubais felt weak-kneed. “I felt that I wouldn't be able to convince him, and that the situation was almost hopeless; there were no chances.” He feared Yeltsin would brush off the conflict as a small misunderstanding, as he had earlier in the day.

It is not known what happened in the meeting, but the result was that Yeltsin decided to fire Korzhakov, Barsukov, and Soskovets, the entire “party of war.” Yeltsin went before the television cameras to make the announcement. “All the time I am being reproached for Barsukov, Korzhakov, and Soskovets,” Yeltsin said in a somber monotone. “Does the president work for them? They began to take too much on themselves and give too little.”

“It was a stunning episode,” Kiselyov recalled. After making his statement, the gray-faced Yeltsin looked at the assembled journalists and beamed broadly. “So what? Why are you staying? You should be rushing to the telephones to announce the breaking news!” Kiselyov saw a flash of the spunky old Yeltsin.

Chubais, triumphant, immediately called a news conference at the Radisson-Slavyanskaya Hotel. He denounced the arrests the night before at the White House as an attempt to wreck the campaign. When asked about the box of money, Chubais threw up a smoke screen. “I am firmly convinced,” he said, “that the so-called box of money is one of the traditional elements in a traditional KGB, Soviet-style provocation, of which we have very great experience in our country.” Chubais suggested the money had been planted. “We are well aware of how foreign currency, money, used to be planted on Russian dissidents and not just on them, and recently we saw a similar situation when drugs were planted. It is, unfortunately, a demonstration of the methods that have become almost commonplace again for Barsukov and Korzhakov, and I am sure this provocation, this falsification, will soon be completely dispelled officially by the bodies of law and order.” Chubais was not asked further about the money.
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In an interview with Chubais that evening on NTV, Kiselyov did not once inquire about the box of money.

Five days later, disaster struck Yeltsin again.

 

At Video International, preparing for an intense second-round campaign, Mikhail Margelov recalled that the company's president, Mikhail Lesin, returned from a meeting of the campaign headquarters with bad news. “It seems that we will have to work during the second round in a difficult situation,” he said.