The project of “loans for shares” and the rise of the “oligarchs” The new capitalist opportunities due to the opening of the Russian economy in the late 80s and early 90s affected the interests of many people. As the Soviet system was being dismantled, well-placed leaders and technocrats in the Communist Party, the KGB and Komsomol (Communist Union of Youth) were taking advantage of the power and privileges they had in the Soviet era. Some gathered silently in your organization profits and hid overseas accounts and investments. Others created banks and businesses in Russia, taking advantage of their privileged positions to win exclusive government contracts and licenses to acquire financial crs and supplies at rock bottom prices low, subsidized by the state. It created great fortunes overnight. The privatization program was deeply corrupt from the beginning.The Western world generally advocated a quick dismantling of the Soviet planned economy to pave the way for the “free market reforms”, but later disagreed about power and corruption of the “oligarchs”. Some called this wave of spoils “nomenklatura capitalism”. At the time when the Yeltsin government undertook sweeping reforms, the “nomenklatura capitalists” had already established itself as powerful. Subsequently, the privatization of state enterprises gave many of those who had enriched the early 90’s an opportunity to convert their money into shares of privatized companies. The Yeltsin government hoped to use privatization to expand as much as possible the holding of shares in former state-owned enterprises, thus political support for his government and his reforms. The government used a system of free vouchers as a way to kick-start the mass privatization.But it also allowed people to buy shares in privatized companies with cash. The government ended the phase of privatization vouchers and cash privatization began devising a program to accelerate the privatization thought that while money would give him a much needed cash. Under the plan, which quickly became known in the West as “loans for shares”, the Yeltsin regime auctioned off substantial packages of shares in some of its most desirable companies, such as energy, telecommunications and metallurgy as collateral for bank loans. In exchange for loans, Yeltsin often gave valuable assets. Under the terms of the agreements, if the Yeltsin government did not return the loan in September 1996, the lender would become the title owner and could sell it or acquire an equivalent position in the company. The first auction took place in the fall of 1995.Usually made in a way that limited the number of bids for bank stocks so as to retain the stock price extremely low. In the summer of 1996, the largest parcels of shares in some of the largest Russian companies had been transferred to a small number of large banks, allowing banks to make these powerful owners of a large number of shares of large companies at prices surprisingly low. The concentration of immense financial and industrial power, which he had helped “loans for shares” scheme was extended to the media. One of the most important financial tycoons, Boris Berezovsky, who controlled large stakes in several banks and companies, exerted great influence on state television programming for a while.Berezovsky and other powerful and influential tycoons who controlled these great empires of finance, industry, energy, telecommunications and media became known as the “Russian oligarchs”. Along with Berezovsky, Mikhail Khodorkovsky, Roman Abramovich, Vladimir Potanin, Vladimir Bogdanov, Rem Viajirev, Vagit Alekperov, Viktor Chernomyrdin, Viktor Vekselberg and Mikhail Fridman emerged as the most prominent and powerful oligarchsin Russia. Corruption covered the area of social relations in the new Russia. Today, what remains of what leaders are drug traffickers and organized crime (see also Russian Mafia). Among them is a small army of extortionists who left the ruins of the socialist system. The oligarchs, who used the contacts made during the last years of the Soviet era to plunder the vast resources of Russia during the unbridled privatization of the Yeltsin years, became the most hated men in the nation.