Russian Presidential
Security Service (PSB), formerly an element of the 9th Chief Directorate
of the KGB, was established as an independent government agency in
December 1993 to provide security for Russian top officials and the
guards for the Kremlin. Initially, the PSB's functions were determined
by an unpublished Presidential decree. Then the Duma granted it the
right to put certain persons under surveillance, and in May 1996 its
statute was issued by the Duma. The code granted the service virtually
unlimited powers, including among other things the right to combat
foreign intelligence, fight crime, and design weapons systems, though
the Duma cut out a clause that would have allowed it to engage in
commercial activity. Over time the PSB evolved from a government
organization into one which was loyal only to its own commander, serving
Korzhakov's personal political interests. Korzhakov had been Yeltsin's
bodyguard since 1987, and in August 1991, he stood next to his boss on
top of a tank during Yeltsin's historic speech.
Korzhakov was frequently accused of meddling in
governmental affairs, as the Service gathered evidence on high
government officials engaged in corruption, bribe-taking, and
squandering money. Korzhakov's people studied the origin of capital at
the National Sports Fund and in the end placed at the head of that
purely commercial structure a staff member of the Presidential Security
Service. The service engaged in the suppression of smuggling, as when on
29 February 1996 the Presidential Security Service completed an
operation which confiscated a batch of jewels worth a total of $3
million delivered from London to Moscow at Sheremetevo-2. Reportedly the
PSB acquired documents which implicated Anatoly Chubais in illegal
financial machinations during the privatization period, in which his
banker associates Gusinsky, Berezovsky, and Vladimir Potanin, In
December 1994 Korzhakov organized an armed raid on the Moscow
headquarters of Most Bank headed by Vladimir Gusinskii. Gusinskii is
allied with Moscow Mayor Yuri Luzhkov, a potential rival to Yeltsin in
the 1996 presidential elections. Soon after the raid, Luzhkov denied he
had any desire to run for president, and Gusinskii has not surfaced in
Russia since January 1995, when he moved his family to London. General
of the Army F.D. Bobkov inspirer and creator of the Fifth Department,
later first deputy chairman of the USSR KGB, serves as head of the
analysis service of the Most financial group.
1996 began with skepticism that President Boris
Yeltsin would allow elections to take place, and on 05 May 1996
Korzhakov explicitly called for postponing the elections. But Yeltsin
finished first in the 16 June 1996 initial round of the Presidential
elections with about 35% of the vote, and was scheduled to compete with
Zyuganov in the runoff slated for 03 July 1996. On the evening of 19
June 1996 Sergei Lisovsky and Arkady Yevstafyev, who were allegedly
carrying a case containing $500,000, were arrested while leaving the
White House of Russia. After being questioned for 11 hours by
Presidential Security Service, Lisovsky [a wealthy advertising and show
business magnate] and Yevstafyev [ a close aide to former first deputy
prime minister Anatoly Chubais] were released. Tipped off by Chubais,
television networks broadcast updates on the unfolding scandal through
the night, portraying the arrests as an attempted coup by Korzhakov.
Instigated by First Deputy Prime Minister Oleg
Soskovets [who supervised the defence industry], Federal Security
Service (FSB) director Mikhail Barsukov, and Aleksandr Korzhakov [Barsukov's
son is married to Korzhakov's daughter, and Korzhakov reportedly helped
his in-law obtain the position of counterintelligence chief], the
arrests were apparently part of a plan to discredit Yeltsin's
re-election campaign. However, on 20 June the trio was abruptly fired
by Yeltsin at the urging of Chubais. The three were hard-liners opposed
to market reform, strong backers of the war in Chechnya, and opposed to
holding the presidential election. Duma Speaker Gennadii Seleznev said
that Korzhakov and Barsukov were fired because they "encroached on
the holy of holies the secret financing of the Yeltsin campaign."
According to one view the firings of Korzhakov, Barsukov, and Soskovets
were the result of a battle between factions within the President's
inner circle between a group that wanted to take power by force and a
group that wanted to win the election "legitimately." Others
saw the events in the context of an ongoing struggle between three
groups: the former heads of the power ministries, representatives of the
energy complex, and representatives from financial circles. Consequently the PSB no longer exists in the
form it had under Alexander Korzhakov. The interference of the PSB in
politics ended 20 June 1996 when Korzhakov was dismissed from his post.
He was replaced by Anatoli Kuznetsov, a professional without political
ambitions or interests, who first became a PSB officer when Ryzhkov was
prime minister. Following Korzhakov's replacement, the FSB was
incorporated into the Federal Protective Service (FSO) headed by Yuri
Krapivin. Under the law of 06 June 1996, the PSS and FSO were two
independent organizations.
Changes in the status of the PSB include: PSB is no longer an organization directly
subordinate to the President; PSB no longer has the right to gather
information for the purpose of ensuring the security of the President
and the state; PSB no longer has the right to use the data
bases of the Presidential staff, government staff, etc; PSB is no longer a separate legal entity with
its own logo, stamp, bank accounts, etc; PSB no longer has the right to buy real estate
on the territory of the Russian Federation, etc.
During the months that followed Korzhakov's
dismissal, significant changes were implemented at the PSB. It is now
restricted to carrying out its intended functions of protecting the
President, and it no longer collects compromising documents on
high-ranking officials and politicians. About 15-20 PSB officers were
dismissed immediately after Korzhakov's resignation, and another 100 PSB
officers submitted their resignations in the following months, with some
850 men remaining on staff [though other accounts report the total FSB
staff as about 1,500].