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Tuesday, September 22, 2009     FOLLOW UPDATES ON TWITTER

Russia prosecutes firms that sold aging jet fighters to Algeria

MOSCOW Ñ Russia is prosecuting executives at a company that torpedoed a $1.3 billion deal to supply advanced MiG-29 fighter-jets to Algeria.   

Officials said Russian prosecutors have drafted an indictment against at least two senior executives of Aviaremsnab, a key supplier in the MiG project. The indictment charges the executives with providing obsolete systems for the MiG-29SMT fighters sold to and rejected by Algeria in 2007.

"This [indictment] is meant to warn businesses that they must honor their contracts, faithfully," an official said.

In May 2009, Aviaremsnab chief executive officer Musail Ismailov and his deputy, Alexander Kutumov, were convicted of selling aging systems to the MiG Corps. for the MiG-SMT for Algeria. The two executives were convicted of fraud in the $14.3 million contract, including forging certificates that designated old and obsolete equipment as new.


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In 2006, Algeria ordered 28 one-seat MiG-29SMT fighters and six two-seat MiG-29UB combat trainers to Algeria as part of an $8 billion military cooperation agreement with the North African state. A year later, the Algerian Air Force rejected the MiGs, saying they contained parts and systems as old as 1982 and that the aircraft fell short of military requirements.

Officials said Aviaremsnab also sold aging parts to the Polish Air Force. They said the state-owned arms agency Rosoboronexport and MiG detected the aging parts before they were installed on the MiGs for Poland.

In April 2009, the MiGs exported to Algeria were returned and absorbed by the Russian Air Force. The MiG-29SMT, an upgrade of the heritage of the MiG-29, was said to comprise a three-fold increase in effectiveness and a 40 percent decline in operating costs.

Another Russian company involved in the Algerian MiG-29SMT deal was the Moscow-based missile producer Dux. Dux has been sued by Rosoboronexport for $15 million to compensate for the export of what was regarded as inferior missiles to Algeria. A hearing was scheduled for Oct. 5.



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