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A court has recognized the evidence collected by the Novosibirsk Region Office of the Investigative Committee sufficient to convict former deputy head of housing department of the Novosibirsk mayor’s office Andrei Gudchenko, founder and CEO of Novosibirsk Hous, a real estate agency Pavel Selyakin, founder and manager of the said agency Lyudmila Yepiklhina found guilty of 25 counts of fraud under Part 4 of Article 159 and 1 count of attempted fraud under Part 4 of Article 159, Part 3 of Article 30. Real estate appraiser Valeriya Selyakina was found guilty of 8 counts of attempted fraud under part 4o f Article 159, Part 5 of Article 33 and 1 count of complicity in fraud under Part 4 of Article 159, Part 5 of Article 33, Part 3 of Article 30.

The court and investigators have revealed that no later than 30 August 2006, former deputy head of the housing department of the Novosibirsk mayor’s office Gudchenko and director of Novosibirsk House Selyakin set up and organized group which involved managers of the said agency to commit frauds, namely to steal money owned by Novosibirsk municipality, in the form of a difference between the underestimated cost of housing and its actual cost which would be paid by an honest buyer they had found to buy this housing. They found an accomplice in late 2010, who estimated the cost of a housing planned by the accomplices to be withdrawn from the municipal ownership at its minimum price so that the accomplices were able to get the maximum possible revenue from the difference between the understated price of the housing and its actual cost paid by an unaware buyer.

The group acted in Novosibirsk for 7 years and was broken off by the agents of the Economic Security and Corruption Department of the Interior Ministry’s Novosibirsk Region Office in February 2014 during a series of investigative and search operations.

The damage done to the municipality by 25 counts of fraud is more than 18 million rubles. The property of Gudchenko and Selyakin, as well as that of others worth more than 30 million rubles was arrested during the investigation to guarantee the execution of a sentence regarding a civil action, to exact a fine and other damages.

The investigators carried out a lot of operations. The case has 212 files including 55 files of indictment. 30 different forensic examinations were run. 181 witnesses were questioned and other operations were run which allowed getting irrefutable evidence against the accused and present it to the court.

The court has sentenced Gudchenko to 8 years in a minimum-security correctional facility, Selyakin to 7 years in a minimum-security correctional facility, Yepikhina and Valeriya Selyakin were handed a 6 and 4-year suspended sentences. 2 counts of fraud committed by Gudchenko, Selyakina and Yepikhina were knocked off from the indictment due to a statute of limitations. Gudchenko and Selyakin were taken in custody right in the court room. The court also turned the property of the accused to compensate for the damage done to Novosibirsk.

Following a request filed by the investigative office under Part 2 of Article 158 of the RF Criminal Procedure Code with the Novosibirsk Council of Deputies, since March 2015 the municipal housing can only be sold via an open bidding and only if the housing cannot be used to settle housing issues of local significance (namely, if they cannot be provided to people in need of better living conditions).

Some files were severed from the case earlier to open a case over similar crimes committed by former official of the housing department of the Novosibirsk mayor’s office Svetlana Stynina, CEO of OOO Komfort Vera Glotova, CEO of OOO AD REM Yelena Kamerzanova and some unidentified people. The investigators keep on revealing instances of stealing money from Novosibirsk by withdrawing housing owned by or funded by the municipality at understate cost. By now the investigators have revealed 36 counts with a total damage of more than 29 million rubles. The property of the accused and the third persons worth more than 250 million rubles was arrested.