2 Top Russian Medical Insurance Officials Detained on Embezzlement, Bribery Charges

November 20, 2006

The two top officials of a Russian government health insurance fund have been arrested on suspicion of embezzlement and bribery, the daily newspaper Kommersant reported Friday.

Russia’s chief prosecutor said earlier this week that persistent corruption has “permeated all levels” of government.

The director of the Federal Mandatory Medical Insurance Fund, Andrei Taranov, and his deputy Dmitry Usenko were detained this week as a result of a probe into the fund’s activities in 2005, Kommersant reported.

It said prosecutors also searched offices and questions officials of three companies that distribute prescription drugs intended for people eligible for benefits under a federally-funded program run by the insurance fund, which is known by the acronym

Kommersant cited an unidentified Health Ministry official as saying the detentions could be linked to the competition that awarded several companies the right to distribute a total of 29 billion rubles (US$1.1 billion; €860 million) worth of medicine under the federal program this year.

It said they came before a new competition for participation in the program next year, when its budget is to rise to 42 billion rubles (US$1.6 billion; €1.25 billion).

The newspaper speculated that the scandal could hurt the reputation of Health and Social Development Minister Mikhail Zurabov, who it said was among those who developed the program, which has faced criticism because the money allotted this year had allegedly run out by July.

Taranov and Usenko were detained on suspicion of embezzling state funds and offering and taking bribes, Kommersant reported.

A district court on Friday ordered Taranov held under arrest and was to rule Saturday on whether Usenko should be held, Moscow City Court spokeswoman Anna Usacheva said.

Insurance fund officials could not be reached for comment, and the Health Ministry declined to comment.

In another reported bribery case, the top police official in Moscow’s northwestern district, Alexei Basov, was detained after allegedly being caught accepting a 400,000 ruble (US$15,000; €1,700) bribe, Interfax said.

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