The alleged corruption scandal at the heart of the Kremlin lapped closer to the former president Boris Yeltsin and his successor, Vladimir Putin, yesterday when Swiss authorities announced they had issued an international arrest warrant for Pavel Borodin, the official who managed the Kremlin's vast property empire until earlier this month.
Mr Borodin is a close colleague of Mr Yeltsin and his influential daughter Tatyana, as well as being Mr Putin's former boss.
He is suspected of laundering Russian budget funds and oil privatisation proceeds through Swiss banks. The funds financed prestige projects to refurbish the Kremlin, contracts that were awarded to a Swiss-based Kosovan Albanian businessman, Beghjet Pacolli.
For the past year Mr Pacolli, head of the Mabetex firm, based in Lugano, Switzerland, has been repeatedly linked to allegations that he underwrote credit cards for the Yeltsin family as part of bribes given to secure the lavish contracts, said to be worth £305m.
Admitting that bribery was usual business practice in Russia, Mr Pacolli confirmed last week that he had guaranteed five credit cards for Mr Yeltsin's wife, Naina, and two daughters, Tatyana Dyachenko and Yelena Okulova, for a period of two months. His bank, the Banca del Gotardo in Lugano, has also disclosed that it guaranteed credit cards for the Yeltsin family, also for a two-month period.
Mr Borodin is a key figure in the alleged scandal. In the first personnel changes he made as acting president after Mr Yeltsin's resignation on New Year's Eve, Mr Putin removed Mrs Dyachenko from her post as image adviser to the president and Mr Borodin from his position as Kremlin property manager.
In 1996-97 Mr Putin had worked as Mr Borodin's deputy in the Kremlin, managing the Kremlin's vast property assets abroad.
Swiss magistrates said yesterday that the arrest warrant for Mr Borodin was issued in secret last month. As a former KGB spy and Russian intelligence chief, Mr Putin may well have known of the Borodin warrant before he removed him from the Kremlin on January 10.
Immediately after becoming acting president, Mr Putin signed an amnesty for Mr Yeltsin and his family, guaranteeing his predecessor and mentor immunity from prosecution.
On Wednesday Mr Borodin was appointed to the senior post of state secretary of the new union of Russia and Belarus.
Last night Mr Borodin denied all knowledge of the warrants. "I can't understand what's being talked about when they speak about a warrant for my arrest," he told the Interfax news agency.
"Not once in my life have I seen an employee from the Swiss prosecutor's office, and I haven't received any documents whatsoever from this agency."
He claimed that the reports of an international arrest warrant were part of a conspiracy. "The roots of this provocation are to be found in Russia," he said - although the news of the warrant was leaked to a Swiss weekly magazine by the investigating magistrate in Geneva, Daniel Devaud.
The "provocation", Mr Borodin added, was aimed at undermining the Russia-Belarus union sealed on Wednesday. Last year the Kremlin repeatedly said the Mabetex scandal was aimed at discrediting Mr Yeltsin.
Swiss prosecutors have been investigating the case for the past year after being asked for help by Russia's prosecutor general, Yuri Skuratov. Millions of dollars in assets have been frozen in Switzerland as a result, including bank accounts in Mr Borodin's name, though he denies having any Swiss bank accounts.
Mr Skuratov fell foul of the Yeltsin coterie and was dismissed by the Russian president last year. But he has since gained parliamentary support for reinstatement and seen the Moscow courts rule in his favour.
He was shown on state television last year cavorting in bed with prostitutes, a video widely assumed to have been filmed and distributed by the KGB's successor, the FSB, which was then headed by Mr Putin.
Mr Putin expects to be elected president in March and Mr Skuratov, proclaiming an "anti-corruption crusade", is running against him.
"Putin is trying to cover the former president of Russia and the closest members of his entourage," Mr Skuratov ssaid, declaring the Yeltsin immunity deal illegal.
"A warrant for the arrest of Borodin suggests that the Swiss investigators have found signs of criminal action in Borodin's doings, involving punishment for money laundering through the Swiss banking system," he said.
Mabetex carried out a series of lucrative building projects in Russia throughout the 1990s, starting in Yakutsk at the beginning of the decade, when Mr Borodin was the town's mayor.
Mr Borodin, 53, who last month failed in his attempt to become mayor of Moscow, was trained as an agricultural engineer.
He made his early career in the Siberian towns of Tuva and Yakutsk, serving as mayor of Yakutsk in 1991-93. It was here that Mr Pacolli obtained the first of many lucrative building contracts in Russia. It was also in Yakutsk that in 1990 Mr Borodin first got to know Mr Yeltsin.
Mr Borodin joined Mr Yeltsin's staff in the Kremlin at the beginning of 1993 and by the end of the year had risen to become the Kremlin's property manager, overseeing billions of pounds worth of property at home and abroad.