Fake payments in the Russian author’s society has reached 439 million rubles.

Office RAO

Photo: Stoyan Vasev / TASS

The leadership of the Russian authors ‘ society has announced the completion of the audit. He revealed that in 2014 and 2015, 63% of payments for a total amount of 211 million rubles were questionable. The payments to authors declined

Following the results of check financially-economic activities of the Russian authors ‘ society and its subsidiaries — CJSC “Service-operating company” (SEC) for 2014-2016, which was conducted by the audit company FBK Grant Thornton, found the bogus charges and the facts of inefficient use of funds that resulted in significant property losses. This is stated in the message RAO, submitted to RBC.

The consultants tested payments to contractors RW from 2014 to 2015 for a total amount of 336 million rubles. 63% of these funds, or 211 million rubles, was questionable. Informed the new management of RAO announced the preliminary results of the audit, in accordance with which a dummy was 75% of payments in the amount of 228 mln., connected with economic activities of RAO UES in 2016. Thus, the total amount of the proven payments for three years amounted to 631 million roubles, of which 439 million are questionable, the calculated RBC.

Also in 2015 there was a decline in payments to authors by 6% compared with 2014, according to the final message RAO. However, the cost of providing its own activities RAO, in contrast, grew by 11%. These funds RAO wrongfully received from the share of the remuneration that was payable to the authors, concluded the auditors.

The head of RAO Maxim Dmitriev also noted that the plan expenditure on waste in 2016 was exceeded several times. It was initially supposed to spend for these purposes of 17.5 million rubles. According to Dmitriev, have been identified and other violations.

“All of these payments and transactions in violation of the law was made in the second half of 2016. At that time, when we convened a special conference in August of 2016, and while it was the courts. When the legally elected members of the copyright Board and the new Director-General is simply not allowed to enter the building RAO. It was during this period actively and funds were withdrawn from the accounts of RAO” is given in the message words Dmitrieva.

The decision to audit was made on 31 August 2016 at the extraordinary conference of authors — members of RAO. Then RAO was headed by Maksim Dmitriev and the author’s advice is updated. Thus, the previous Chairman of the Board, producer Igor Matviyenko called the changes a “hostile takeover attempt” of the organization. Two months before that, the ex-CEO of RAO Sergei Fedotov was arrested on charges of fraud in especially large size. According to investigators, he contributed to the conclusion of RAO more than 500 million rubles In January 2017 Fedotov concluded pre-trial agreement with the investigation.

RAO appeared in 1993 to protect the interests of domestic and foreign copyright holders — composers, writers, playwrights. The society unites nearly 29 thousand members. The organization has 189 concluded agreements on mutual and unilateral representation with 119 foreign copyright societies in 68 countries. For the services of RAO were charged from 10 to 35% of the amount of royalties depending on where performed or replicated the work.

The largest societies for the collective management of music rights in Russia along with RAO are the Russian Union of rights holders (RSP) and the all-Russian intellectual property organization (WIPO). They all have the state accreditation and can collect remuneration for authors and performers. So, RAO is engaged in duties in favor of the authors of RSP — electronics manufacturers for private copying and WIPO performers and producers of phonograms.

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