LOCAL NEWS

PRESIDENT ORDERS PROBE INTO STATE FIRMS

MOSCOW — President Dmitry Medvedev on Friday ordered Prosecutor General Yury Chaika and the head of the Kremlin’s oversight department, Konstantin Chuichenko, to open an investigation into state corporations, in a sign of growing skepticism over the institutions’ role in the economy.

Medvedev ordered a sweeping investigation into how state corporations function, including their use of state assets and the degree to which their current activities correspond to federal law, according to a statement posted on the Kremlin’s web site.

Medvedev set a deadline of Nov. 10 for the investigators to present their findings, including whether or not the state corporation model should “continue to be used as a legal and management structure.

CIS ALLIES WARY OF MOSCOW FOLLOWING WAR

MOSCOW — A year after Russian troops crushed the Georgian army in South Ossetia, Moscow has cobbled back together its ties with the West, but in a largely unforeseen consequence of the war, relations with other former Soviet states have become increasingly strained.

The war and Moscow’s subsequent recognition of Abkhazia and South Ossetia as independent states halted NATO’s advance toward Russia’s borders and demonstrated to the world the country’s decisiveness in defending what it deems national interests.

ARRESTS CONTINUE AS POLICE CRACK DOWN ON GAMBLING

The city’s police arrested the owner of an illegal gambling venue and detained another owner this week as they continue to target illegal gambling spots after the Kremlin launched a reform last month that ordered all casinos in the country to close down.

RELIGIOUS GROUP WANTS GAY CLUBS MOVED

MOSCOW — A nationwide Christian association has called on government authorities to relocate gay clubs away from residential areas and schools, as well as cultural, sports and medical facilities.

Japan Told To Halt Sending Of Aid to Kurils

MOSCOW — The Foreign Ministry announced on Friday that Russia has stopped accepting Japanese humanitarian aid to the Kuril Islands, which have been receiving the assistance for 18 years.

“The Japanese side has received explanations that there is no need for further humanitarian aid,” the ministry said in a statement, without elaborating.

NATIONAL NEWS

U.S. DIPLOMAT NAMED IN PURPORTED SEX VIDEO

MOSCOW — A senior U.S. diplomat in Moscow was caught up in a sex scandal on Friday, after a grainy video that purports to show him meeting prostitutes was picked up by national newspapers.

The man is named as Kyle Hatcher, the second secretary of the U.S. Embassy, in the video, which was originally published Thursday on Informacia.ru. The video was covered in Izvestia and Komsomolskaya Pravda on Friday.

Izvestia ran a story headlined “An American Diplomat Knows How to Negotiate With Russian Tarts,” while Komsomolskaya Pravda headlined its story “Smut: The Sin of a Diplomat.”

A spokeswoman for the U.

ACTOR FACES 10 YEARS IN JAIL FOLLOWING DRUNKEN BRAWL

MOSCOW — With his impish, round-cheeked face, Vladislav Galkin began his career playing Huckleberry Finn and became one of Russia’s most popular actors.

But his good-guy image took a severe blow when he drunkenly shot at a barman who refused to serve him another drink and then punched a policeman.

On Wednesday, Galkin, 37, was charged with hooliganism using a weapon and nonlife-threatening violence against a law enforcement official.

POLITKOVSKAYA TRIAL TO CONTINUE

MOSCOW — The judge presiding over the retrial of the men charged with involvement in the murder of Novaya Gazeta journalist Anna Politkovskaya on Friday threw out requests from her family’s lawyers to send the case back to the prosecutor for further investigation.

NAVY CONTINUES ITS HUNT FOR MISSING VESSEL

MOSCOW — The Navy and the Federal Security Service are searching for a Finnish ship with a Russian crew that disappeared in the Atlantic Ocean en route to Algeria, the Navy said Sunday, Reuters reported.

SAAKASHVILI CRITICIZES ‘INVADERS’

MOSCOW — Georgian President Mikheil Saakashvili defiantly marked the first anniversary of his country’s war with Russia, denouncing Russian troops who control two Georgian regions as “invaders.”

In a heated speech Friday to a rain-drenched crowd of thousands in Gori, Saakashvili vowed that Russia would never again regain control of his small country, his voice sometimes a growl and sometimes rising to a near shout.

CYBERATTACK ON GEORGIAN AFFECTS TWITTER, FACEBOOK

MOSCOW — A massive cyberattack against a Georgian blogger that caused a global knockout of Twitter and slowed several other popular web sites must have originated in Russia, the blogger said Friday.

LOCAL BUSINESS

EATERY REVENUES SLUMP BY ALMOST 20%

Turnover at St. Petersburg’s restaurants and cafes in June fell by 19.3 percent compared to the same period for last year, dropping to 3.5 billion rubles ($111 million), according to new figures released by Petrostat.

The overall decrease during the first half of the year amounted to 15.

FEW DARE TO OPEN BUSINESSES

The entrepreneurial spirit is strong in young Russians, a poll published on Friday showed. It’s only after they finish university and go out into the real world that they lose their desire to be their own boss.

RELATIVE CALM MAY BE COMING TO AN END

Equity markets have been mostly range-bound throughout the summer, taking a breather from a dramatic bounce in the first five months of the year.

But with only a few weeks left before stocks head into the traditionally volatile months of September and October, a variety of factors — from faint signals that the economic crisis could be loosening its grip to fears of ruble devaluation in the coming year — could bring a sudden end to the summer’s calm.

IN BRIEF

Ford Goes Back to Work

MOSCOW (Bloomberg) — Ford Motor Co. resumed production at its factory near St. Petersburg, Russia, after halting output on July 20 because of slumping demand.