Loans for shares scheme
Russian fraudulent privatization scheme / From Wikipedia, the free encyclopedia
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Beginning in 1995, Boris Yeltsin's government began privatizing state-owned shares in companies through a loans for shares scheme.[1] The scheme helped with "fundraising" for Yeltsin's 1996 reelection campaign and restructuring freshly-sold companies at the same time (in order to outweigh communist sympathizers as one source speculated).
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Russian bankers constituted the majority of those who have provided the funds[clarification needed] (see Letter of thirteen [ru]). The rest included such entities as Stolichny bank (Russian: Столичный банк) and World Bank (who made a loan for a small percentage of the Sibneft oil company) and even some targeted investments from USAID in assistance to Chubais.[2][note 1]
The scheme was primarily overseen by Anatoly Chubais who was linked to USAID program managed by head of the Harvard Institute for International Development (H.I.I.D). at the time.[3][2]
The scheme implementation ultimately resulted in the emergence of an influential class of enterprise owners, known as Russian oligarchs.