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Russias oil tycoon trial is political

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Russia Oil Tycoon's Trial Is Political
Fri Jul 16, 2004 01:28 PM ET

By Oleg Shchedrov
MOSCOW (Reuters) - The co-defendant in the fraud and tax evasion trial of Russia's richest man and oil magnate said on Friday the case was politically motivated.

Platon Lebedev, like Mikhail Khodorkovsky a big shareholder in oil giant YUKOS, made his blunt declaration a day after prosecutors accused both men of acting in a gang committed to securing shares unlawfully in privatized firms in the 1990s.

"The authorities are prosecuting me for political reasons. The accusations are not true," Lebedev said from the defendants' metal cage, without saying who he thought was behind the trial.

The oil giant, fighting to avert bankruptcy after being served with back tax bills close to $7 billion, hired Credit Suisse First Boston and Renaissance Capital to evaluate its assets after bailiffs began an inventory of its Siberian units.

Current chairman Viktor Gerashchenko, once seen as a figure to reach a settlement with authorities, called for dialogue to avert bankruptcy and said there was no reason for him to quit.

Khodorkovsky's lawyers have said the former central banker has failed in his role as a go-between.

Khodorkovsky and Lebedev are facing up to 10 years in a labor camp if found guilty by the Moscow court.

President Vladimir Putin and other Russian officials deny frequent accusations from critics, media and political analysts that the case had political motivation.

But the first trial of an "oligarch" -- one of a handful of businessmen who made vast fortunes under Putin's predecessor Boris Yeltsin -- is widely seen as part of a Kremlin crusade to stamp out any political ambitions among the super-rich.

Gerashchenko said in a statement YUKOS was riven by internal conflict pitting groups of owners and managers against each other.

"There are groups of influence interested in a protracted conflict with the state in order to resolve their personal, mercantile interests," he said. "A YUKOS board headed by me will oppose these groups by all means."


A YUKOS official told Reuters the company wanted "as many independent evaluations as possible" amid market concerns that bailiffs could sell off YUKOS's assets after it failed last week to meet a deadline on a $3.4 billion back-tax bill for 2000.

The Justice Ministry sent bailiffs to Siberia and the Volga region this week to estimate the value of YUKOS's three core producing units, Yugansk, Tomsk and Samara.

Under Putin, the "oligarchs" have become media targets, accused of plundering industrial wealth during 1990s privatization's and trying to rule Russia from behind the scenes.

Analysts suggest that Khodorkovsky, who funded opposition parties, was picked as a victim for not bowing in time to the Kremlin's demand that "oligarchs" stay out of politics.

Khodorkovsky said he was a scapegoat for others' errors.

"I will prove that what is happening is an awkward attempt to blame me for the faults of the privatisation laws in the 1990s," he told the court.

In a letter from his cell, published in March, he acknowledged privatisation had been unfair and turned millions against market economics. But he denied breaking laws.

On Friday, he cited the example of two successful companies, which he is alleged to have seized in a breach of law in the mid-1990s, to show his ownership ultimately benefited thousands.

Khodorkovsky has offered to give up his stake to save YUKOS from bankruptcy. But officials have shown little willingness to talk to him or management.

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Russias oil tycoon trial is political

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