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US attacks Khodorkovsky guilty verdict

28/12/2010 14:33
A Russian judge has found Mikhail Khodorkovsky, the jailed Yukos oil tycoon, guilty of embezzlement and money laundering in a politically charged second trial decried by the US as casting doubt on the rule of law in Russia.

The judge, Viktor Danilkin, said on Monday that he had found the arguments of Mr Khodorkovsky unconvincing and that both he and Platon Lebedev, his former business partner, were guilty of “embezzling property belonging to others by abusing their official positions”.

The guilty verdict marks a milestone in a seven-year legal onslaught against Mr Khodorkovsky that has come to define Vladimir Putin’s Russia.

The tycoon’s arrest in 2003 on charges of fraud and tax evasion had been seen by critics as Kremlin retribution for Mr Khodorkovsky’s efforts to challenge Mr Putin’s hold on power, by funding opposition parties; the second charges have been seen as designed to keep the two men behind bars until long after presidential elections in 2012.

Mr Khodorkovsky was convicted of embezzling $27bn of oil, or all the oil Yukos produced between 1998 and 2000 and all the crude it exported between 2000 and 2003. Prosecutors said the tycoon used transfer pricing schemes and a vast network of offshore companies to siphon oil from Yukos production units.

But Mr Khodorkovsky said he was being tried for normal business practices with all the oil trades consolidated into Yukos and the profits reinvested in the company.

Even critics of the jailed tycoon have said the charges, which could land Mr Khodorkovsky another six years in jail after his first sentence expires next year, are absurd.

German Gref, Russia’s former economy minister, testified that he would have noticed such large-scale theft if it had occurred.

Analysts said the guilty verdict was a clear sign that Mr Putin, now prime minister, held the upper hand in Russia’s ruling tandem.

The trial had been seen as a test of pledges by Dmitry Medvedev, the president, to uphold the rule of law in the country and boost the independence of the courts.

But just two weeks ago Mr Putin left little doubt he expected a guilty verdict, telling the nation, in a televised question-and-answer session, that “a thief must sit in jail”.

The White House, which stressed Washington’s co-operation with Moscow during the debate on the Start treaty, said Barack Obama, US president, had discussed the case many times with Mr Medvedev and warned that relations would be affected by Russia’s “failure” to respect the rule of law.

In an apparent barb at Mr Putin, the White House said the administration stood “in solidarity with the many people in the Russian government, in the legal system, and in civil society who are committed to strengthening the rule of law” and praised Mr Medvedev for his “important campaign” for reform.

Vadim Klyuvgant, Mr Khodorkovsky’s lead lawyer, said the defence team would appeal against the verdict, which he said was clearly predetermined.

“If the court were free and independent in issuing its verdict, it would have issued an acquittal. What we heard here confirms that the court has faced pressure.”

Hillary Clinton, US secretary of state, earlier said the verdict raised “serious questions about selective prosecution – and about the rule of law being overshadowed by political considerations”.

“This and similar cases have a negative impact on Russia’s reputation for fulfilling its international human rights obligations and improving its investment climate,” Mrs Clinton said.

Guido Westerwelle, Germany’s foreign minister, said: “The circumstances of proceedings are highly alarming and a step back for the country on its road to modernisation.”

The UK foreign office called for Russia to create a transparent and independent court system, expressing concern following the verdict that the legal system was being used in a “discriminatory” way.

Dressed in black, Mr Khodorkovsky leant despondently against the wall of the glass cage he and Mr Lebedev have been kept in during the trial while the judge read the verdict. He had appealed to the judge to pronounce an independent verdict in an emotionally charged final speech to the court in November, saying it would decide the country’s fate.

While the judge kept his eyes cast down as he sped through the verdict in a monotonous voice, barely above a mutter, the chants of hundreds of protesters gathered on the icy Moscow street outside the courtroom could be heard. Their shouts of “Freedom” and “Russia without Putin”, however, descended into screams as Russian special forces moved in to quash their demonstration, detaining about 20 people.