From Russia with Blood. Heidi Blake

was a dashing young officer with an insouciant eye who boasted a more swashbuckling KGB career than Putin did, having served two years in Afghanistan during the Soviet-Afghan War. Litvinenko’s information suggested that in the dying days of the KGB, Ivanov had forged close ties with the leader of the Tambov gang—Vladimir Kumarin—and he had brought Putin into the action. The Tambovs were locked in a bloody turf war for control of the St. Petersburg seaport with the rival Malyshev gang, and it seemed Ivanov had sided with Kumarin, marshaling the resources of the KGB to help him drive out the enemy and consolidate the Tambovs’ control of the city. From then on, according to Litvinenko’s evidence, Ivanov became a key lieutenant of Kumarin, assisting him with his operations smuggling heroin into the port as well as bolstering the gang’s other lucrative lines of business: arms smuggling, human trafficking, racketeering, extortion, and contract killings. Putin, meanwhile, appeared to have been enlisted to help whitewash the profits: he was on the advisory board of a sham real estate company called SPAG, which seemed to have been set up by Kumarin to launder Colombian drug money.

      When the KGB fell, in 1991, Putin and Ivanov appeared to have taken their Tambov connections with them. Ivanov went to work for its immediate successor, the FSK, and the evidence suggested he had continued to use the state’s resources to help Kumarin flood St. Petersburg with narcotics. Putin, meanwhile, had won himself a place in the mayor’s administration and it looked like he was using his new role in the city government to protect Ivanov and Kumarin from official scrutiny. Litvinenko was sure he had hit on something big, and he intended to keep digging. The young officer had no idea how deadly his discovery would one day prove to be.

      Mayor Sobchak had warmed instantly to the sober, diligent new functionary at city hall, who kept his head down and let his boss shine. Putin’s fluency in German was a boon as St. Petersburg opened up to the world along with the rest of the country, and he was soon made the head of the mayor’s committee for external relations in charge of attracting foreign investment.

      St. Petersburg was by then in the grip of a crippling food shortage caused by hyperinflation—and Putin soon found that out of every crisis comes opportunity. The local government had been granted federal permits to export oil, timber, and metals to be bartered abroad in exchange for meat, fruit, and sugar for the hungry population, and it was his job to distribute export licenses to local companies. Raw materials worth $100 million were shipped out of the city under his watch—but, oddly enough, the companies to which he awarded the permits all shut down right after the cargo set sail. That left no one to hold accountable when the goods disappeared and no food ever arrived in return.

      The export imbroglio caught the attention of Marina Salye, a redoubtable city council deputy who had made it her business to root out corruption in St. Petersburg. When the food failed to arrive, she opened an investigation. Salye suspected that Putin and his cronies had pocketed the goods for themselves while the people of the city starved, and her inquiry led to a city council vote recommending that prosecutors investigate him for embezzlement. But Putin angrily denied any wrongdoing, blaming the failure on the now-defunct companies, and he would never be prosecuted, because Sobchak stood in the way.

      The mayor had shot to power on the back of stinging attacks on the authoritarianism of the old Communist regime, but he had quickly come to curse the new democratic mechanisms that replaced the Soviet system. There were four hundred freshly elected representatives in city hall following St. Petersburg’s first free elections, and Sobchak found himself hog-tied as the rookie legislators pulled all the levers of their new powers at once. They went to war over even the most basic decisions and reveled in their new right to challenge Sobchak’s every move in court.

      Putin had seen his boss buffeted by the turbulent city council, and now he felt the sting of parliamentary scrutiny himself. Democracy, he learned, just gets in the way. But capitalism was an entirely different story. The market made anything possible. By the time he became deputy mayor, Putin had become a neat fusion of old Russia and new: hybridizing the authoritarian tendencies of his Soviet security training with an appreciation for the market and a kleptocrat’s taste for a criminal scheme. And as his influence in St. Petersburg expanded, his ambitions grew. So when Boris Berezovsky came knocking, Putin saw the path to real power opening up before him.

*Much of the evidence Litvinenko gathered about the Tambovskaya Bratva was later disclosed to the Litvinenko Inquiry and published at litvinenkoinquiry.org. Both Putin and Ivanov have always denied any connection to organized crime.

       iii

      Davos, Switzerland, 1996

      The windows of the opulent Swiss salon gave a warm glow onto the snowy streets of the ski resort where the global elite were gathering for the world’s most exclusive summit. Inside, Boris Berezovsky was in full rhetorical flight, hunched forward as he made his impassioned case to a small but powerful audience. It was January of 1996, and on the sidelines of the World Economic Forum, the future of Russia was once again being decided by a cabal of megarich men.

      Boris Yeltsin was preparing to stand for reelection at the end of his first term, and he was already careening drunkenly toward a humiliating defeat. The national misery caused by his economic shock therapy program, coupled with his increasingly shambolic public appearances, had made the president a figure of contempt among ordinary Russians, and his approval ratings were bumping along below 10 percent. To Berezovsky’s deepening alarm, the Communists had swept the board in the parliamentary elections the previous month and established a commanding lead in the early presidential polls. Berezovsky knew what would happen if the Reds retook the Kremlin: the oligarchs would be destroyed. The former state assets they had accumulated would be confiscated, their wealth would be clawed back, and spells in Siberian prison would be all they had to look forward to. The full horror hit home when the Communist Party leader arrived at Davos to be greeted by a succession of world leaders and the international media as the future president of Russia. Berezovsky was not about to stand idly by and let Russia backslide. He simply had too much at stake.

      The godfather had gathered his fellow oligarchs on the sidelines of the Davos summit to propose a plan to save the motherland. The men around the table must ensure Yeltsin’s reelection at all costs—and when the battle was won, they would make the president pay. Berezovsky’s persuasive powers did not fail him, and the group formed a secret pact to pump tens of millions into a war chest devoted to defeating the Communist threat. Altogether, the “big seven” oligarchs controlled around 50 percent of Russia’s wealth and all its mass-media outlets: they would use the money, as well as their TV stations and newspapers, to wage an all-out information war on Yeltsin’s behalf. Russian electoral rules forbade campaign spending of more than $3 million per candidate—but when had the robber barons ever let a little matter like the law stand in their way?

      Back in Moscow, Berezovsky poured the Davos fighting fund into a slick Western-style election campaign, complete with rock concerts, celebrity endorsements, and glossy advertising, and dedicated the airwaves of Channel One and the column inches of Kommersant to coverage vaunting Yeltsin and painting the Communist Party as blood-crazed Stalinists. The plan worked. Yeltsin climbed steadily back from oblivion in the polls, and when the election came around that summer, he won. But the backing of the oligarchs did not come cheap.

      In exchange for the money they had put into Yeltsin’s reelection, the big seven acquired controlling stakes in yet more of the prized assets still under state control. As soon as Yeltsin was safely back in the Kremlin, the assets were put up for sale in rigged auctions, a move that cemented the hatred of the Russian people toward the band of kleptocrats now all but ruling the country. In 1997, the year after what became known as the Davos Pact and the windfall that followed, Forbes magazine named Berezovsky the world’s ninth-richest entrepreneur, with a personal fortune of $3 billion. And the rewards he reaped for shoring up Yeltsin’s second term were not purely financial.

      The godfather wielded ever more influence after the election. Yeltsin gifted him a prized job as deputy director of the Kremlin’s national security council and made him Russia’s point