The source did not reveal any further information.
The Prosecutor General's Office and the Interior Ministry have not yet commented on the information.
Investigators said that while Nikolayev was not entitled to bodyguard protection, in September 2004 he signed a contract for armed bodyguards, and in September 2005 he illegally signed a contract for the protection of city administration property.
Both contracts were financed from the Far Eastern city's budget, and between September 28, 2004 and January 31, 2007, a total of 4,400,000 rubles ($170,000) was illegally paid out.
Prosecutors said that during his trips around the city, Nikolayev's car would be accompanied by a column of police cars, in violation of the law, and that some 600,000 rubles ($23,000) from the city budget was used to pay for the escorts in 2006.
Nikolayev has denied all charges.
Criminal proceedings were also launched against a deputy city administration head on misappropriation charges.
