Putin's Oil Heist Episode 1: Putin’s Plan
“If you want to understand the story behind the story of Russia's invasion of Ukraine, you can draw a straight line back to the Yukos Affair.” The demise of Yukos, Russia’s second-biggest oil company, marked the first time that Vladimir Putin tested the West, watching to see how the West would respond to the seizing of the company’s assets, Bruce Misamore says. Putin’s Oil Heist is an insider’s account of the Yukos Affair. In this pilot episode, host Loren Steffy explores how it unfolded, with first-person accounts from Misamore, the company’s former Chief Financial Treasurer.
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Bruce Misamore’s expectations when he went to Russia in the early 2000’s. When Vladimir Putin rose to power, he was seen as someone who wanted to reform the Russian government and strengthen ties with the West. Bruce thought he’d be helping to modernize and establish new standards for Russian business to operate in the global market.
Mikhail Khodorkovsky’s rise to riches. Prior to being Misamore’s boss at Yukos, Khodorkovsky was a communist youth leader who started a business selling imported computers with some friends. With the money they made from the PC business, they started a bank, Menatep, and helped keep the Russian government afloat by buying assets from struggling state-owned businesses. Among the companies Menatep controlled was Yukos.
How Misamore came to work for Yukos. By the year 2000, Khodorkovsky had positioned himself as the leading practitioner of normalized democratic capitalism in Russia and insisted on making Yukos more transparent by bringing in foreign directors to establish internationally recognized standards for the company’s operations. Despite Khodorkovsky’s reputation of questionable business dealings, Misamore felt that he was sincere in his passion for Yukos.
Yukos’ role as a model for Russian businesses in the global marketplace. It became the first Russian company to publish quarterly financial statements that adhered to the U.S. generally accepted accounting principles, or GAAP. Yukos became Russia's largest oil and gas company and the only large Russian company with no state ownership. They were the fastest growing oil company in the world by rate of both percentage and actual production, and the best performing international equity, both in emerging markets as well as the oil and gas markets.