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Sochi Winter Olympics: activist alleges cost overruns and conflicts of interest Sochi Winter Olympics: activist alleges cost overruns and conflicts of interest
(35 minutes later)
A website launched on Monday by anti-corruption activist Alexei Navalny paints a vivid picture of suspected cost overruns and other apparent abuses including conflicts of interest at the Sochi Winter Olympics.A website launched on Monday by anti-corruption activist Alexei Navalny paints a vivid picture of suspected cost overruns and other apparent abuses including conflicts of interest at the Sochi Winter Olympics.
Russia has spent about £30bn to deliver the Sochi Olympics, which run from 7-23 February, making them the most expensive Olympics ever, even though fewer athletes compete in winter than summer Games. Russia has spent about £30bn to deliver the Sochi Olympics, which run from 7-23  February, making them the most expensive Olympics ever, even though fewer athletes compete in winter than summer Games.
Navalny claims that Russia spent twice as much as necessary to build at least 10 of the Olympic venues, including the Bolshoi Ice Palace, the Fisht Stadium and the speed-skating arena.Navalny claims that Russia spent twice as much as necessary to build at least 10 of the Olympic venues, including the Bolshoi Ice Palace, the Fisht Stadium and the speed-skating arena.
Allegations of corruption have dogged preparations for the Sochi Games for years. Navalny's new website Sochi.FBK.info combines data gathered in his own investigations with media reports and other activists' analysis.Allegations of corruption have dogged preparations for the Sochi Games for years. Navalny's new website Sochi.FBK.info combines data gathered in his own investigations with media reports and other activists' analysis.
Using colourful graphics, the website makes a wide range of data accessible in English and Russian.Using colourful graphics, the website makes a wide range of data accessible in English and Russian.
"Athletes are not the only people who compete in Sochi," Navalny, who finished second in Moscow's mayoral election last year, wrote on the website. "Officials and businessmen also took part in the Games and turned them into a source of income.""Athletes are not the only people who compete in Sochi," Navalny, who finished second in Moscow's mayoral election last year, wrote on the website. "Officials and businessmen also took part in the Games and turned them into a source of income."
Russian president Vladimir Putin has rejected claims about rampant corruption in Sochi, saying the inflated prices were due to the honest mistakes of investors who underestimated the costs. Russian President Vladimir Putin has rejected claims about rampant corruption in Sochi, saying the inflated prices were due to the honest mistakes of investors who underestimated the costs.
"If anybody has got this information, please show this to us," Putin said in a recent television interview. "But so far we haven't seen anything except speculation.""If anybody has got this information, please show this to us," Putin said in a recent television interview. "But so far we haven't seen anything except speculation."
A 2012 report by the government's audit chamber found about 15 billion rubles (about £260m) in "unreasonable" cost overruns in the preparations for the Sochi Olympics. A 2012 report by the government's audit chamber found about 15bn rubles (about £260m) in "unreasonable" cost overruns in the preparations for the Sochi Olympics.
Auditors found the work of some staff members at Olympstroi, the state company in charge of Sochi construction, between 2008 and 2010 was "conducive to incurring unreasonable cost overruns". At least three criminal investigations against Olympstroi employees have been opened, but none of them has reached court. Olympstroi has since changed its management.Auditors found the work of some staff members at Olympstroi, the state company in charge of Sochi construction, between 2008 and 2010 was "conducive to incurring unreasonable cost overruns". At least three criminal investigations against Olympstroi employees have been opened, but none of them has reached court. Olympstroi has since changed its management.
The Sochi Organising Committee would not comment on Monday about Navalny's new website..The Sochi Organising Committee would not comment on Monday about Navalny's new website..
Olympstroi was given free rein by Putin to "determine the ground rules for selecting investors and contractors" for Olympic venues. This created fertile ground for corruption in the allocation of funds, according to Ivan Ninenko, deputy director of Transparency International in Moscow.Olympstroi was given free rein by Putin to "determine the ground rules for selecting investors and contractors" for Olympic venues. This created fertile ground for corruption in the allocation of funds, according to Ivan Ninenko, deputy director of Transparency International in Moscow.
Olympstroi "is even less transparent than companies in [Russia's] state-owned sector, where corruption is rife," he said.Olympstroi "is even less transparent than companies in [Russia's] state-owned sector, where corruption is rife," he said.
Navalny's new website lists several Sochi construction projects with apparent conflicts of interest. In one of the most glaring examples, the Ice Cube curling stadium was built by a company controlled by businessman Alexander Svishchev, father of Dmitry Svishchev, president of the Russian curling federation, the website said, citing public records.Navalny's new website lists several Sochi construction projects with apparent conflicts of interest. In one of the most glaring examples, the Ice Cube curling stadium was built by a company controlled by businessman Alexander Svishchev, father of Dmitry Svishchev, president of the Russian curling federation, the website said, citing public records.
One of the key beneficiaries of lucrative Olympic contracts was Putin's childhood friend Arkady Rotenberg. Through a majority-owned subsidiary, Rotenberg holds nearly 39 percent of the Mostotrest company, which amassed a dozen Olympics-related state contracts to build nearly all of the highways in the area. One of the key beneficiaries of lucrative Olympic contracts was Putin's childhood friend Arkady Rotenberg. Through a majority-owned subsidiary, Rotenberg holds nearly 39% of the Mostotrest company, which amassed a dozen Olympics-related state contracts to build nearly all of the highways in the area.
Mostotrest's contracts in Sochi amounted to $3.1 billion, including a $1.6 billion bypass for Sochi, as well as tunnels, bridges and railroads, the company confirmed. Mostotrest's contracts in Sochi amounted to $3.1bn, including a $1.6bn bypass for Sochi, as well as tunnels, bridges and railroads, the company confirmed.
The Russian business daily Vedomosti in 2009 analysed scores of tenders for Olympic contracts and discovered that the majority of bids were very close to the maximum the state said it would pay, and in many cases bidders were barred from running, leaving one company to claim the contract.The Russian business daily Vedomosti in 2009 analysed scores of tenders for Olympic contracts and discovered that the majority of bids were very close to the maximum the state said it would pay, and in many cases bidders were barred from running, leaving one company to claim the contract.
Mostotrest won the $1.6 billion bypass contract after firms owned by tycoons Oleg Deripaska and Roman Abramovich dropped out of the competition in 2009. Mostotrest offered to build the road for 59.36 billion rubles, just barely below the maximum state price of 60.9 billion rubles. Mostotrest won the $1.6bn bypass contract after firms owned by tycoons Oleg Deripaska and Roman Abramovich dropped out of the competition in 2009. Mostotrest offered to build the road for 59.36bn rubles, just barely below the maximum state price of 60.9bn rubles.