YEKATERINBURG, Ural Mountains ? At a time when Russia faces growing unemployment, some would-be entrepreneurs are being scared out of business by the mob.


One is Oleg Morozov, 23, who started a private real estate company in Moscow in late 1992. Morozov is no shrinking violet. In the army, he spent three days in an underground stockade for his mocking mural of Felix Dzerzhinsky, founder of the Soviet secret police.


Morozov said he dropped out of law school when he realized that students were paying bribes to pass exams and could even buy their degrees.


He and a friend cut their teeth in real estate by leasing a hotel floor for the ruble equivalent of $25 per room, and then renting the rooms to foreigners for $110 a night.


"It was perfectly legal, but they never would have let us do it if we hadn't paid the hotel director and the front desk receptionist," he said.


Fewer than three months after Morozov and a new partner opened a real estate office, racketeers came calling.


"One guy who knew how to talk and four hulking guys with broken noses" promised they would be back in a week to start collecting , he said.


Morozov said he quit then and there. He and others say the only way to stay in business is to find a "reasonable" mafia that charges low rates ? as little as 8 percent ? and provides protection against thugs and extortionists.