Change of Leadership in Crimea Means Property Grab

Change of Leadership in Crimea Means Property Grab, One day in October, a dozen armed men in masks drove up to the gates of Yalta Film Studios. They weren't actors, and this was no make-believe. It was a hostile takeover.

"They forced all the employees onto the ground, sealed off the premises and halted the work of the studio," said owner Sergei Arshinov.

The studio, nestled in the hills overlooking the Black Sea, is just one of thousands of businesses seized from their owners since Crimea was annexed by Russia eight months ago. Crimea's new pro-Moscow leaders say the takeovers, which they call nationalizations, are indispensable to reverse years of wholesale plunder by Ukrainian politicians and oligarchs.

But an Associated Press investigation throughout this peninsula the size of Massachusetts found many instances of less noble practices: legal owners strong-armed off their premises; buildings, farms and other prime real estate seized on dubious pretenses, or with no legal justification at all; non-payment of the compensation mandated by the Russian constitution; and targeting of assets belonging to or used by the Crimean Tatar ethnic minority and the pro-Kiev branch of the Orthodox Church.

In a preliminary estimate, Ukraine's Justice Ministry told AP that around 4,000 enterprises, organizations and agencies have had their property expropriated.

Some holdings, from shipyards to health resorts, were publicly earmarked for repossession by Crimea's regional government, now part of the Russian Federation. Others were simply seized by armed men, sometimes carrying official decrees that were never published or no documentation at all.

Crimea's Russia-installed prime minister, Sergei Aksyonov, says the nationalization law enacted Aug. 8 seeks to right wrongs committed by officials in Ukraine, where a lot of state property was sold off at bargain prices because the government was broke, or to benefit cronies.

"Over the past 10 years, the majority of state property was illegally stolen from the government," Aksyonov told AP. "Enterprises were privatized via fraudulent schemes and the state didn't receive any money."

'JUST A LAND GRAB'

At the 34,600-acre Dobrobut farm in far eastern Crimea, the fields now lie fallow, and the 26 employees haven't been paid for months.

It was June when two carloads of men arrived at the farm with pistols, clubs and assault rifles. In hand, the men had a piece of paper signed by Aksyonov.

The document, seen by the AP but never issued publicly, proclaimed that the land tilled by Dobrobut ? under lease from the local village ? was being nationalized. The men took over not only the fields, but also Dobrobut's buildings, its harvest and its equipment, all worth about $1.6 million.

Alexander Garfner, an attorney for Dobrobut, sued in a Crimean court, now part of the Russian justice system. On Sept. 2, the lawsuit was thrown out.

"If we look at the law, then there is no basis for this," Garfner said. The nationalization attempt, he said, "was clearly just a land grab, because it's big money."

The seizures investigated by the AP vary in scale and type of assets involved. But many, like Dobrobut, are reliably profitable and would require little additional investment, including a bus company with a monopoly on $14.6 million in annual ticket sales.