07MOSCOW2562, TAX INSPECTORS UNBLOCK INTERNEWS/EMF BANK ACCOUNTS

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Reference ID Created Released Classification Origin
07MOSCOW2562 2007-06-01 03:21 2011-08-30 01:44 CONFIDENTIAL Embassy Moscow

VZCZCXRO2056
PP RUEHDBU
DE RUEHMO #2562 1520321
ZNY CCCCC ZZH
P 010321Z JUN 07
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC PRIORITY 0767
INFO RUEHXD/MOSCOW POLITICAL COLLECTIVE

C O N F I D E N T I A L MOSCOW 002562 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: DECL: 05/30/2017 
TAGS: PHUM KDEM SOCI PGOV EAID RS
SUBJECT: TAX INSPECTORS UNBLOCK INTERNEWS/EMF BANK ACCOUNTS 
 
REF: A. MOSCOW 1896 
     B. MOSCOW 1810 
 
Classified By: Political Minister Counselor Alice G. Wells. 
Reason 1.4(d). 
 
1. (SBU) SUMMARY: On May 30, Moscow tax inspectors 
acknowledged that an earlier decision to freeze the bank 
accounts of Internews/Educated Media Foundation (EMF) had 
been a "misunderstanding" and allowed the accounts to be 
re-opened.  The inspectors' decision in the wake of multiple 
interventions by the Embassy and Secretary allows the 
beleaguered, USG-funded NGO, which has been providing media 
training for regional outlets and journalists, to pay rent 
and salaries.  Still pending in the EMF case are possible 
criminal charges against ex-EMF Director Manana Azlamyan and 
a case filed by EMF lawyers to force the return of the NGO's 
computer servers and other materials confiscated during a GOR 
raid on the organization's offices. EMF's ordeal has been a 
blunt reminder to the NGO community of their vulnerability to 
GOR prosecution.  End Summary. 
 
2. (U) On May 30, the Moscow the Tax Inspectorate reversed 
its May 23 decision to freeze the bank accounts of the 
Educated Media Foundation (EMF), the successor organization 
to Internews.  The inspectors had alleged that EMF had not 
filed a VAT declaration in the last quarter, a charge that 
Aslamazyan denied, according to media accounts. EMF attorney 
Viktor Parshutkin told us May 31 that the Tax Inspectorate 
had acknowledged that the decision to freeze the account had 
been the result of a "misunderstanding."  The Inspectorate's 
reversal of course frees EMF to pay its rent, salaries, and 
other expenses. 
 
3. (SBU) Although able now to discharge its administrative 
responsibilities, the work of the NGO remains blocked by an 
earlier confiscation, during a raid on EMF headquarters, of 
its computer servers and other materials.  An EMF-filed case 
to force the return of its equipment remains unheard as of 
May 31.  It has been delayed by changes of court and of 
investigatory jurisdiction.  In the latest twist, Parshutkin 
has filed a new complaint in the Tverskoy Court that, if 
accepted, will shift the venue for the third time in less 
than one month. The Court has seven working days in which to 
announce the date of the trial.  Parshutkin was cautiously 
optimistic that EMF's equipment would eventually be returned, 
and that the organization, at some point in the future, would 
be able to resume its work. 
 
4. (SBU) In addition to the impending hearing on the 
confiscation of EMF's computer servers and other materials, 
an investigation continues on the charge against Aslamazyan 
that ultimately prompted the raid of EMF.  (Azlamazyan was 
charged (reftels) with failing to declare currency above the 
allowable limit upon entry into Russia.)  According to 
Parshutkin, on May 23 Aslamazyan's case was transferred to an 
inspector in the Investigative Division, who is reportedly 
pursuing the possibility that she was involved in contraband 
operations.  Contraband charges, if filed against Aslamazyan, 
are much more serious than the administrative violation she 
was initially investigated for.  Parshutkin described the 
latest potential development simply as "bad."  Aslamazyan is 
reportedly in Paris, and is preparing to take a position in 
New York working for Internews. 
 
5. (SBU) Because of the uncertainty over EMF's continued 
operations, plans for its future are on hold and alternatives 
are being considered.  EMF had hoped to spin off its Media 
and Research Analysis Center and other activities as 
commercial enterprises, with some funding from USAID to help 
in the transition.  Those plans are now stalled.  To fill the 
void left by the possible crippling of EMF, USAID is 
preparing a USD 2.5 million fund (USD 1.6 million more than 
was planed for EMF) for a partnership program that will pair 
Russian media associations with U.S. or international 
counterparts. 
 
6. (C) Comment:  The unfreezing of accounts and ability of 
EMF to continue operations in Russia, (although without its 
current director), if borne out, is welcome news.  It follows 
multiple interventions by the Embassy and the Secretary with 
GOR officials.  However, EMF's ordeal has been a blunt 
reminder to an already skittish NGO community that they are 
under scrutiny and vulnerable to aggressive prosecution. 
BURNS

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