Tropical Hypocrisy: One Russian Lawmaker's Florida Real Estate Problem

By Michael Weiss

The chairman of Russia's ethics committee opposes foreign property holdings -- except for himself.

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Visitors walk along Ocean Drive, temporarily closed to vehicles for the weekend, during the Urban Beach Weekend, on southern Miami Beach on May 26, 2012. (Andrew Innerarity/Reuters)


The late Christopher Hitchens liked to say of any outspoken homophobe from the Beltway to the Bible Belt that "sooner rather than later, he will be discovered down on his weary and well-worn old knees in some dreary motel or latrine, with an expired Visa card, having tried to pay well over the odds to be peed upon by some Apache transvestite." A similar, if slightly less colorful, rule applies to loudmouth Russian officials who inveigh against the evils of the United States and routinely render glory unto the Motherland. One need only count the hours before a portfolio emerges showing a strong preference for beachfront properties located everywhere but on the Black Sea.

Not only does a jingoistic anti-American Russian lawmaker love the Sunshine State, he also clearly enjoys doing business in a country with transparency and the rule of law.

Embattled anti-corruption campaigner and opposition political figure Alexey Navalny had great good fun in the last fortnight showing how Vladimir Pekhtin -- not just a decade-long United Russia State Duma deputy but the chairman of the State Duma Ethics Committee -- was in violation of the bill he has co-sponsored banning state officials from owning property, bank accounts or assets abroad, punishable by a $328,000 fine and five years in jail for violators. A slightly watered-down version of the bill (this one proscribing stocks and bank accounts but allowing "declared" property) passed the lower house of parliament unanimously on Friday and will almost certainly become a law as part of Vladimir Putin's new " deoffshorization " effort to keep rubles from leaving Russia.

It seems that none of the Floridian condos, homes or land plots which Pekhtin co-owns with his 35 year-old son Aleksey, and which Navalny reckoned are worth more than $2 million, had been declared in Pekhtin's public financial disclosures. Even before the ban on foreign holdings is passed, these hidden assets would pose a problem for any state official the Duma's draft code of ethics for deputies: "The failure by any Duma deputy to submit a declaration of his income, assets, and liabilities, as well as the income, assets, and liabilities of his spouse and underage children, or the submission of an untrue or partial declaration, is a violation of the laws of deputy ethics."

For a man who supports the current ban on American adoption of Russian orphans, as well as the paranoid effort to register NGOs as "foreign agents," Pekhtin's voting record is in his many property deeds and bills of purchase in Florida. And his response to the disclosures, which Navalny obtained from the original spadework of Russian blogger/physicist Doctor Z, was a marvel of semantic ingenuity. An initial interview with the pro-regime newspaper Izvestia went like this:

Izvestia: "Tell me, in principle, do you have any property outside of Russia?"

Pekhtin: "Well, practically nothing."

I: "Practically? So yes or no?"

P: "No, I do not! I've lived here all my life in Russia."

Pekhtin later corrected himself and said that everything listed in his name belonged to his son who first went to the U.S. for academic study, then started businesses there; if Pekhtin's name was scribbled onto a few property deeds, well, that didn't make him an owner. But this absurdity was plainly too much for Putin. On February 15, Pekhtin resigned from the Duma Ethics Committee chairmanship pending an investigation into the offshore assets he claims he doesn't have. Then, on February 20, he resigned from parliament altogether with a stentorian valedictory that was broadcast on state television and had his fellow MPs on their feet with applause.

"I will give up my mandate, which I always achieved in honest political battle, and my rivals, my opponents, know this," he said. "Nevertheless, I will not cling to it. Because I think that my personal matters are secondary to United Russia. Thank you for many years of work, and for your devotion. We will fight on."

For now, though, Pekhtin is free to attend as many pilates classes or eat as many pulled-pork sandwiches as he likes. As Navalny pointed out, the hypocrisy in this scandal is actually twofold. Not only does a jingoistic anti-American Russian lawmaker love the Sunshine State, he also clearly enjoys doing business in a country with transparency and the rule of law despite abetting a system back home that treats such concepts with utter disdain. It also didn't help anyone but Pekhtin's detractors that he happened to buy and sell property in a state with one of the most publicly accessible registry systems in country.

Public records don't lie, and neither do court judgments. A lien in the amount of $5,690 owed was placed in 2007 on a lot that Vladimir and Aleksey jointly own at the nice-sounding Plantation Pines in Ormond Beach. They failed to pay construction costs on project (probably something to do with one of the pools they were building) at 433 Juniper Lane. The lien was later dismissed after the complainant, Prestige Gunite Florida LLC -- the owner of Prestige Concrete Products -- tried to foreclose on it in 2008, and the Pekhtins evidently satisfied their debt, although a woman at Prestige's offices refused to discuss the lien or any details with me.

In 2007, Aleksey Pekhtin purchased Unit No. 1548S at the Flamingo South Beach Condo at 1500 Bay Road in Miami Beach. Aleksey then transferred ownership of the unit to himself and his father on August 4, 2007. Vladimir's share is valid to this day, as you can see by this helpful summary -- complete with aerial photograph -- of the property at the Office of the Miami Dade County Property Appraiser. The unit was purchased for $540,900 and is now worth $248,490. Judging from this promotional video of Flamingo condos, they're very nice digs indeed.

On April 4, 2012, Pekhtin fils et pere purchased 1,530-square-foot apartment at 1500 Ocean Drive, the "Michael Graves" building as one learns at this helpful website. Navalny estimates, based on property taxes, that the purchase price was $1.27 million. The Appraiser currently has the condo listed at around $885,710 -- not such a terrible loss for a guy on a public salary in this down market. After some trawling of my own, I even found a copy of the Condo Association's Certificate of Approval of both Pekhtins' ownership. I then phoned Frank Fiorentino who was at the time the Vice President of the Condo Association and the man whose signature appeared on the certificate. A very nice man with a comforting Brooklyn accent recalled "the Pekhtins" (plural) though said he never met them, much less did he know what the father did for a living. I asked if they jointly owned the property. He said that if both men's names were on that document, they'd both be on the contract of sale.

Vladimir Pekhtin seems to think that if he takes his name off a deed or title or transfers assets to another party, this too is undetectable. In December of last year, he sold his share in the 1500 Ocean Drive apartment to Aleksey, likely in response to opposition parliamentarian Dmitry Gudkov's writings linking Pekhtin to the so-called "Golden Pretzel's list," a study of how, despite a proscription on Duma deputies engaging in business ventures, plenty of them do anyway. Yet that sale is recorded, complete with Vladimir's signature.

It's usually the most frivolous scandals in Russia that get the most attention internationally. But what's changed in the last year is the effectiveness with which Russian activists can now chivvy the Putinist nomenklatura. As Vladimir Kara-Murza rightly noted on this case of United Russia's double-bookkeeping, "The regime may still be stronger than civil society. But it can no longer ignore it."

This article available online at:

http://www.theatlantic.com/international/archive/2013/02/tropical-hypocrisy-one-russian-lawmakers-florida-real-estate-problem/273542/