Putin’s People. Catherine Belton

were horrified at the choice. But, compromise by compromise, Sobchak was climbing his way to the top. By the time the city held elections for mayor in June 1991 he was the front-runner and won with relative ease.

      When, that August, a group of hard-liners launched a coup against the Soviet leader, Sobchak relied on part of the old guard – in particular Putin and his KGB connections – to see himself, and the city, through a defiant stance against the attempted putsch without any bloodshed at all. Threatened by the increasing compromises Gorbachev was making to democrats driving for change, the coup plotters had declared a state of emergency, and announced that they were taking over control of the Soviet Union. Seeking to prevent Gorbachev drawing up a new union treaty that would grant the leaders of the restive Soviet republics control and ownership of their economic resources, they’d essentially taken Gorbachev hostage at his summer residence at Foros, on the shores of the Black Sea.

      But in St Petersburg – as Leningrad was now named once again – as in Moscow, the city’s democratic leaders rebelled against the coup. While members of the city council manned the defences of the democrats’ headquarters in the tattered halls of the Marinsky Palace, Putin and Sobchak garnered the support of the local police chief and sixty men from the special militia. Together, they persuaded the head of the local television company to allow Sobchak on air on the first evening after the coup.[105] The speech Sobchak gave that night denouncing the coup leaders as criminals electrified the city’s residents, and brought them out in the hundreds of thousands the next day, when they gathered in the shadow of the Romanovs’ Winter Palace to demonstrate against the coup. Sobchak rallied the crowd with powerful calls for unity and defiance, but in the main he left the most vital and difficult mission to his deputies, Putin and Scherbakov. That first tense night of the putsch, after making his televised address, he buried himself deep in his office in the Marinsky Palace, while Putin and Scherbakov were left to negotiate with the city’s KGB chief and the Leningrad region’s military commander to make sure the hard-line troops approaching in tanks did not enter the city.[106] While Sobchak addressed the crowds gathered on the Palace Square the following day, Putin and Scherbakov’s negotiations had stretched on. And when the tanks came to a rumbling halt that day at the city limits, Putin disappeared with Sobchak and a phalanx of special forces to a bunker deep beneath the city’s main defence factory, the Kirovsky Zavod, where they could continue talks with the KGB and military chiefs in safety through an encrypted communication system.[107]

      By the time Putin and Sobchak emerged from their bunker the next morning, the coup was over. The hard-liners’ bid to take power had been defeated. In Moscow, elite special units of the KGB had refused orders to fire on the Russian White House, where Boris Yeltsin, by then the elected leader of the Russian republic, had amassed tens of thousands of supporters against the coup’s bid to roll back the freedoms of Gorbachev’s reforms. What remained of the legitimacy of the Communist Party was in tatters. The leaders of Russia’s new democracy were ready to step up. Whatever his motives, Putin had helped them be in a position to do so.

      All the while, true to his KGB training, Putin had reflected everyone’s views back to them like a mirror: first those of his new so-called democratic master, and then those of the old-guard establishment he worked with too. ‘He would change his colours so fast you could never tell who he really was,’ said Sedelmayer.[108]

       2

       Inside Job

      *

      ‘What we’ve discussed is how the darkest forces never give up. The French Revolution, the Soviet one, all the others, appear first as a liberating struggle. But they soon morph into military dictatorship. The early heroes look like idiots, the thugs show their true faces, and the cycle (which isn’t what revolution means) is complete.’

      Christian Michel

      *

      MOSCOW, August 25 1991 – It was late in the evening when Nikolai Kruchina trudged wearily through the door to his flat in the closely-guarded compound for the Party elite. Just four days before, on August 21, the attempted coup by Communist hard-liners seeking to preserve Soviet power had collapsed in failure. And now, the institutions Kruchina had served for most of his life were being dismantled in front of his eyes. The evening before, he’d held a series of high-level meetings with the powerful boss of the Central Committee’s International Department, Valentin Falin, and he seemed exhausted.[1] The KGB watchman outside his home noticed his downcast gaze, his clear reluctance to talk.[2]

      The changes in those four short days had come thick and fast. First, the pro-democratic Russian leader Boris Yeltsin had signed a decree, broadcast live, suspending the Soviet Communist Party and ending its decades of rule. Yeltsin’s defiant stance against the hard-line leaders of the attempted coup had put him firmly in the ascendant. He now by far eclipsed Gorbachev, who stood timidly to the side of the podium as Yeltsin addressed the Russian parliament. Arguing that the Communist Party was to blame for the illegal coup, Yeltsin ordered that the sprawling, warren-like headquarters of the Party’s Central Committee on Moscow’s Old Square be immediately sealed. Filed in hundreds of its rooms were the secrets of the Soviet Union’s vast financial empire, a network that spanned thousands of administrative buildings, hotels, dachas and sanatoriums, as well as the Party’s hard-currency bank accounts and untold hundreds, perhaps thousands, of foreign firms set up as joint ventures in the dying days of the regime. Through these bank accounts and other connected firms, the strategic operations of the Communist Party abroad – and those of allied political parties – had been funded. It was the engine room of the Soviet struggle for supremacy against the West. This was the empire Kruchina had administered as the chief of the Communist Party’s property department since 1983. Its sudden sealing felt like a symbol of all that was lost.

      Kruchina’s wife turned in early that night, leaving her husband alone, she believed, to spend the night sleeping on the couch. But early the next morning she was awoken by a knock on her door. It was the KGB watchman. Her husband, she was told, had fallen to his death from the window of their seventh-floor flat.[3]

      There were no apparent signs of disturbance, and the watchman said he’d discovered a crumpled note lying on the pavement next to Kruchina’s body. ‘I’m not a conspirator,’ it said. ‘But I’m a coward. Please tell the Soviet people this.’[4] The KGB immediately declared his death a suicide. But to this day, no one knows what exactly happened – or if they do, they are not willing to tell. Those who were at the centre of events in those days, like Viktor Gerashchenko, then the head of the Soviet state bank, prefer to limit their explanations to a Delphic ‘He fell.’[5] Others like Nikolai Leonov, then the powerful head of the KGB’s analytical department, insist that Kruchina was a victim of a ‘deep depression’ that set in at the empire’s collapse.[6]

      A little over a month later, the same thing happened to Kruchina’s predecessor as property department chief. On the evening of October 6, Georgy Pavlov fell to his death from the window of his flat. His death, at the age of eighty-one, was also recorded as a suicide. Eleven days after Pavlov’s death, another high-ranking member of the Party’s financial machine fell to his death from his balcony. This time it was the American Section chief of the Communist Party’s international department, Dmitry Lissovolik. Again, it was recorded as a suicide.

      What linked the three men was an intimate knowledge of the secret financing systems of the Communist Party at the time the KGB was preparing for the transition to a market economy under Gorbachev’s perestroika reforms. The property department Kruchina and Pavlov oversaw had been understood to have a value of $9 billion.[7] Western experts estimated its foreign holdings at many times more.[8] But in the first few days after the Communist Party’s collapse, Russia’s new rulers were bewildered to discover that the Party’s coffers were nearly empty. Rumours abounded that officials, overseen by Kruchina, had siphoned billions of roubles and other currencies through foreign joint ventures hastily set up in the final years of the regime.[9] Russian prosecutors, originally ordered by Yeltsin to investigate the Communist