Yukos tycoon stands trial

Russia's richest man stood trial on Wednesday for fraud, tax evasion and embezzlement.

    Khodorkovsky says the charges are politically motivated

    The case against former Yukos chief Mikhail Khodorkovsk

    y has seen him

    toppled

    from the heights of corporate power and driven the nation's leading

    oil group to the brink of bankruptcy.

    Khodorkovsky is standing trial with a top associate, Platon

    Lebedev, whose arrest last July heralded the start of the so-called

    Yukos affair - widely seen in Russia as a political witchhunt.

    The first day of their trial, which is expected to last several

    months, was still going on eight hours after it began at the

    Meshchansky court in central Moscow amid tight security.

    Khodorkovsky's lawyers asked the judge to release their client

    for the duration of the proceedings. Earlier, the judge declined a

    similar request by Lebedev's attorneys.

    Potential sentence

    "In my understanding, a person can be kept in custody if there

    is a risk he will commit a crime comparable to what he is accused

    with," Khodorkovsky told reporters during a break in Wednesday's

    session.

    "Nothing like that was proved where I am concerned."

    Khodorkovsky and Lebedev are charged with seven counts of fraud,

    tax evasion and embezzlement and are accused of defrauding the state

    of more than $1 billion.

    "In my understanding, a person can be kept in custody if there

    is a risk he will commit a crime comparable to what he is accused

    with.

    Nothing like that was proved where I am concerned"

    Mikhail Khodorkovsky,
    former Yukos chief

    Both have denied any wrongdoing but face up to 10 years in

    prison if found guilty.

    For the first time since the arrests last year, reporters were

    allowed into the courtroom, although attorneys said conditions for a

    truly open hearing had not been provided.

    Khodorkovsky and Lebedev sat in a courtroom cage, as is the

    custom in Russia's Soviet-era judicial system, and joked between

    themselves during a break in the proceedings.

    Yukos shares fall

    Meanwhile, investors frantically shed shares in Yukos, which

    Khodorkovsky and Lebedev, along with several other associates,

    acquired during Russia's controversial privatisations in the 1990s

    .

    Yukos faces two upcoming court hearings of its own that could

    force the oil giant to declare bankruptcy.

    On Friday, a court is due to decide whether to uphold the tax

    ministry's claim of $3.5 billion dollars

     in unpaid taxes for 2000, as well as extra fines and

    interest.

    On 23 June, a court will rule when the claim, if upheld, can be

    enforced.

    With Yukos warning that it cannot pay the tax bill because of a

    freeze imposed on its assets after Khodorkovsky's arrest, investors

    and analysts did not wait for any court decisions.

    Fabulous wealth

    After closing on Tuesday at their lowest levels in 30 months,

    Yukos shares ended Wednesday's trading down 3.88% on Russia's

    benchmark RTS Index.

    Putin has vigorously pursued
    Russia's oligarchs

    The probe into Yukos and its key shareholders was launched last

    summer and is widely seen as Kremlin payback for Khodorkovsky's

    political ambitions. However, President Vladimir Putin has angrily

    lashed out at such speculation.

    Khodorkovsky, 40, was detained on 23 October when masked

    security service agents stormed his private jet during a stopover in

    Siberia and flew him to Moscow.

    The confident tycoon who last year was among Russia's most

    powerful people has been in jail ever since.

    Khodorkovsky's supporters say he was targeted because he had

    spent part of his fortune financing opposition parties before

     last

    December's parliamentary election and because he had dared to openly

    defy Putin.

    Khodorkovsky's wealth was estimated this year by Forbes magazine

    at $15.2 billion.

    SOURCE: AFP


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