1/ Two fatal bridge collapses in 24 hours have highlighted the shoddy state of Russia's railway infrastructure. Despite a recent record level of investment, much of the money has been stolen by corrupt contractors and Russian Railways officials. ⬇️ 
2/ The Russian Crime website, which tracks corruption in Russia, reports that "schemes for embezzling tens of billions of rubles, procurement abuses, overstated project costs, and abuse of official position for personal gain have been uncovered" in Russian Railways (RZD).
3/ The scale of the problem is systemic and spans the length of Russia. In 2023 alone, 143 criminal cases of corruption were opened against employees and officials of Russian Railways, with 111 people convicted so far.
4/ Much of this relates to procurement fraud, exploiting RZD's high level of state funding. Typical crimes include kickbacks, price gouging, and collusion with suppliers, including being paid to overlook corruption, overpaying for work, or accepting poor-quality work.
5/ Under RZD CEO Oleg Belozerov, appointed in 2015, investment grew to a record 1.5 trillion rubles ($19.4 billion) in 2024. However, this was accompanied by an unprecedented increase in freight tariffs, which drove many customers to switch to road and water instead.
6/ RZD has failed to bring down the high cost of its infrastructure projects. It has funneled money to single contractors selected without competition in corrupt schemes, most notably involving the 1520 Group of Companies, which received 218.2 billion rubles in one year.
7/ 1520's co-owners are said to have paid over 2 billion rubles to Interior Ministry officials to overlook systematic procurement fraud. One Interior Ministry colonel received a monthly 'subscription' of $150,000 to protect 1520 from investigations.
8/ Much of the fraud involved awarding contracts to preferred contractors who then overcharged or under-delivered, with the difference ending up in individuals' pockets. At least 218 billion rubles ($2.8 billion) is said to have been stolen this way.
9/ As a result, projects have been delivered late or at excessive cost (or both), and routine maintenance has suffered because of a lack of funding or poor-quality work being delivered.
10/ For instance, RZD paid Transtelecom for telecom equipment at costs 20-30% higher than market prices. Another RZD division paid nearly 100% more for a batch of equipment, with local managers claiming the difference for themselves.
11/ The cause of the two recent bridge collapses is not yet known, but it's likely to have been the result of a lack of maintenance or of maintenance work being done poorly. Similar problems are likely to exist across the Russian railway network. /end
• • •
Missing some Tweet in this thread? You can try to
force a refresh
