The town of Vilyuchinsk, at the foot of the Kamchatka volcanoes, December 10, 2011 Vladimir Karpov / Fotobank Lori

Dozens of construction workers came to the closed town of Vilyuchinsk to build military facilities. Now they aren’t being paid, and they’re not allowed to leave.

In September 2018, an electrician living in Kazan named Ruslan Shamsutdinov came across an online job posting from a company called “Buildings and Structures Construction Management” (SUZS) looking for electricians to work on a project in the town of Vilyuchinsk in Kamchatka, offering 80,000 rubles ($1,180) a month. Shamsutdinov applied for the job and got it. He arrived in Kamchatka on October 12.

Situated on the Krasheninnikov Cove, Vilyuchinsk is restricted-access territory and homebase to several nuclear submarines and attached military units. You’re supposed to enter the town through staffed checkpoints, but Shamsutdinov says he was brought in on a boat, without the proper documents. He soon got to work, and on October 25 he was supposed to receive his first paycheck, but nobody paid him. So Shamsutdinov spoke to some of his colleagues and learned from another construction worker that no one on staff has been paid as promised in months, despite their work building two military facilities designated by the numbers “720” and “3002” (workers declined to give Meduza any further details about the construction). These people can’t leave Vilyuchinsk, either, because they were brought in illegally, and could be arrested at any checkpoint.

Meduza spoke to three of Shamsutdinov’s colleagues (who estimate that SUZS employs about 70 workers at both construction sites), and their stories are similar. Pavel, another electrician, says he came to Vilyuchinsk from Khabarovsk for a job that was supposed to pay 80,000 rubles a month. (He found the position online, and Meduza has a copy of the advertisement.) Pavel says there’s enormously high personnel turnover at SUZS: “The locals don’t work here at all because they cheat them, and outsiders can’t leave — they’ve got no choice.” In the past two months, he’d been paid just 25,000 rubles ($370). Pavel says he’s now planning to submit a formal resignation letter (though he says his employers asked him merely to take a leave of absence), and he hopes to return to Khabarovsk on November 16.

“We’re prisoners of circumstance,” says another electrician from Kazan, who came to Vilyuchinsk on October 10. “They don’t want to discuss anything. They just say: if you make a fuss, we’ll take you out to the perimeter, and you can do what you want.”

One of Shamsutdinov’s other colleagues says SUZS handed out 2,000 rubles ($30) to each worker. He says he was also brought into Vilyuchinsk on a boat “and then by backroads.” “Guys wanted to earn some money ahead of New Year’s, but instead they’re sitting around here with nothing — without even the passes [needed to leave the town],” the electrician told Meduza. “They’ve only given passes to three people. Thank God, they haven’t taken anyone’s passport.”

This isn’t the first time workers in Vilyuchinsk have complained about wage arrears. Russia previously abolished its entire Federal Special Construction Agency because of corruption in the construction of naval installations.

Construction sites for military facilities in Vilyuchinsk have run into problems before. In 2015, the Federal Special Construction Agency (which was then in charge of building new military facilities) hired workers to build a pier for submarines in the town. Construction halted three times because of wage arrears and the agency’s failure to transfer retirement deposits to Russia’s Pension Fund. In late March 2016, workers announced another strike, prompting a visit from a naval official who informed them that the money for their salaries had already been transferred in full to the Federal Special Construction Agency. Citing local labor union leader Oleg Fedorov, the media outlet Kamchatsky Krai later reported that “management handed each worker 5,000 rubles [$74] in cash from some suitcase, after the military officer’s visit, and insisted that nobody complain further to anyone.”

Submarines based in Vilyuchinsk, September 17, 2011 Alexey Kudenko / Sputnik / Scanpix / LETA

Reporting on compliance with federal laws in 2017, Attorney General Yuri Chaika stated that more than 1.6 billion rubles ($23.6 million) in government money had been stolen from naval construction sites developed by subsidiaries of the Federal Special Construction Agency, particularly in Vilyuchinsk. Chaika also noted that these subsidiaries’ numerous legal violations led President Putin to abolish the agency in November 2016 and transfer its functions to the Defense Ministry.

Workers in Vilyuchinsk have gone on strike. Employers are referring them to the Federal Special Construction Agency and threatening staff.

Shamsutdinov says some of the workers went after November 3, when SUZS director and formal owner Alexander Zorych visited Vilyuchinsk and threatened to fire anyone who complained about wage arrears.

On November 6, Shamsutdinov and two colleagues went to the SUZS Human Resources Department, asking to be paid and allowed to go home. (Meduza obtained a recording of this conversation.) HR head Nina Zorych (Alexander Zorych’s wife) told Shamsutdinov that he would be paid in Moscow, because that is where he was registered originally. She could not say, however, when he would be given a ticket to go to Moscow, and advised him to speak to her husband. When Shamsutdinov said he would wait there to speak with him, Nina Zorych became enraged.

“You think he’ll up and come running all just for you?” she asked, nearly shouting. “Why don’t you settle down, or I’ll fucking have to call in the boys. Just look at this little fucker! He’s a goddamn Tatar. I’ll show you some manners, you shit on a stick. I’m calling the guys now. I’m calling the police.”

At this point, another man joined the conversation, claiming to be responsible for leasing the premises to SUZS. He said the money problems were due to the fact that the main contractor (which he identified as the Federal Special Construction Agency) “was changing its structure and bank.” He asked Shamsutdinov to “be patient,” explaining that “nobody wants to cheat anyone.” The situation, he said, was simply “horrible” and the money “just physically isn’t here” and wouldn’t arrive for at least another month. “You can bang your head against the wall, but it won’t change anything,” he added. Shamsutdinov said he was prepared to take the matter to the news media and the district attorney’s office, mentioning that workers don’t even have passes to be in Vilyuchinsk. Hearing this, the man started threatening Shamsutdinov, saying, “I’m a local resident here, and I’ll call the police now, and they’ll take you away. You’ll never come back here, and you won’t even be able to do anything about it. So let’s be civilized.”

“When will I go home?” Shamsutdinov asked.

“When you start acting civilized,” Nina Zorych answered.

“You don’t get it,” the man added. “This isn’t going to get you anything. It will only make it worse.”

“When will I go home?” the electrician asked again.

“I’ll explain it again, so you understand,” the man said. “Our country is an interesting country. Right now, at this very moment, all our money is just frozen.”

“You’ll go to the district attorney, but the district attorney won’t be able to do anything. Look where we are,” the man added, waving his hand. “Do you realize what the military is?”

The man also told Shamsutdinov that all Federal Special Construction Agency spending is now being routed through Promsvyazbank, because “that’s what the government decided,” even though the bank “just doesn’t exist in Kamchatka.” On December 15, 2017, Russia’s Central Bank began restructuring Promsvyazbank, after discovering violations in its reporting and the destruction of credit history records. The Finance Ministry later announced that Promsvyazbank would be restructured into a base bank for the country’s defense industry and major state contracts, requiring all enterprises involved in this work to transfer their accounts. Pyotr Fradkov, the son of Russia’s former prime minister, was appointed to head the institution.

Update: On November 12, a spokeswoman for Promsvyazbank contacted Meduza, explaining that “account transfers to authorized banks occur in stages” and do not prevent the company from “simultaneously conducting calculations through a previous servicing bank,” regardless of whether the account has already been opened at Promsvyazbank. “To provide services to a company and make calculations, the bank does not require a physical presence in the region,” the spokeswoman said.

Ending the conversation, Nina Zorych told Shamsutdinov that his employment contract would be torn up, if he bought a ticket home. “You haven’t met our expectations, unfortunately,” she said. “Honestly, I wouldn’t have gone so easy on you,” the man added, and then told Zorych, “I’m surprised that you’re so kind to people. I’d have been tougher.”

When contacted and asked to explain the situation with workers' unpaid salaries, Nina Zorych requested the phone number for Meduza’s management. “I could file a police report against you for privacy invasion and defamation,” she said. “The laws must be obeyed!” She did not explain what she meant by “defamation,” and refused to answer Meduza’s questions directly.

One of the contractors in Vilyuchinsk is Prime Minister Dmitry Medvedev’s old ski instructor. Russia’s Defense Ministry ordered the construction.

Meduza has learned that the state contract to build “Installation № 720/1” in Vilyuchinsk went to a company called “Front Engineering.” Previously, it was registered at the same Moscow address on Yuzhnoportovy Proezd as SUZS. Both companies also share the same phone number. Sources in Vilyuchinsk told Meduza that SUZS also operates “under the brand name” of “Front Engineering.” The company Front Engineering actually enjoys a solid track record, having constructed stadiums in Moscow and St. Petersburg, buildings for the Moscow Central Administrative District Prefecture and several Moscow courts, apartment complexes in Moscow and Volgograd, and many other projects.

The contract to build the other military installation in Vilyuchinsk (identified by Meduza’s sources as № 3002) went to a company called “Rosengineering Energy,” ownership of which is split between an offshore in Cyprus and “Rosengineering,” whose main owner is Dmitry Novikov. Mr. Novikov is friends with Prime Minister Dmitry Medvedev, and even acted as his ski instructor. Novikov was also one of Russia’s biggest contractors who received government money to build “ski clusters” outside Sochi for the 2014 Winter Olympics and the Igora Ski Resort (where Katerina Tikhonova, allegedly one of Vladimir Putin’s daughters, married businessman Kirill Shamalov in February 2013).

The Russian Defense Ministry’s Main Military Construction Directorate № 4 administers the contracts for both naval installations in Vilyuchinsk. The slogan that appears on the agency’s website reads, “To build is to create!”

Story by Ilya Zhegulev, with additional reporting by Ivan Golunov and Alexander Gorbachev. Translation by Kevin Rothrock.