government sources to obtain background information on prospective
customers and clients, Leasing Life has discovered.
Former Russian security service employees are being hired into
leasing companies’ security departments to obtain government
reports on private individuals.
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According to Eric Sievers, senior vice-president at Nordkap
Bank, it has become an accepted and “nearly universal business
practice” of any medium to large-size company.
“[The companies] hire this guy, he is a salaried employee, and
he just goes to these government ministries or security services
and gets reports on people, or gets reports on companies,” Sievers
explained.
Europlan, the number one car lessor in Russia, employs 40 such
employees in its security department, 15 of which are based in
Moscow, according to Pierre De La Baume, a director at the
company.
There is “general camaraderie” among former and current
employees of the defence and security services in Russia, which
enables the security departments of leasing companies to obtain
information from government sources.
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By GlobalDataAccording to Sievers, these reports are “the stuff that these
guys don’t want you to know”, such as past bankruptcies, suspicion
of corruption, whether business partners dislike them, and more.
Although information can crop up about a person being disliked for
his political views, he estimates that this happens “no more than 2
percent of the time”.
“They just make a phone call, or walk in, and ask for a report
on anyone,” he said. “They just hand over an envelope with $100 to
$200 [€78 to €156] in it, and within a few days we get a report
back.”
For example, Sievers’ bank, Nordkap, a Swiss-based bank that
provides finance to emerging market economies, recently requested a
report on a “well-respected” executive of a major investment bank
who had referred a deal to them.
The government report revealed he was not just referring the
deal because he thought the company was a good prospect, but
because his cousin owned the company.
“We view these reports as the best two pages of information we
can get,” said Sievers. “We could call up a law firm and get
charged $5,000, or we could hand over a couple of hundred and get a
‘to-the-point’ report within three days – from a cost-benefit
analysis, it is a great deal.”
These same employees will often also be in charge of
collections, as they have the “skills that are pertinent to that”.
Sievers emphasises they are not hired because they are “big burly
guys”, but because firms want to be politically smart.
“If you are in charge of collections and you want to speak to
the local police; who is better – an expat who doesn’t speak much
Russian, or a guy who used to work for the security services?” he
added.
Sievers believes that most Western leasing companies would not
be aware of these practices, as they will have been instituted by
local employees, who can easily hide small amounts from company
accounts.
“It would be a hard one to explain, and it just plays into the
prejudices of it being a Kremlin-controlled economy, with
corruption here and there,” said Sievers.
“Why get into that discussion? Is it a bribe? It is not an
exorbitant amount of money. This is part of the cash flow of the
security services.”
Jason T Hesse
