Ethics Newsline®

MOSCOW
Russian oil tycoon Mikhail Khodorkovsky was sentenced last week to nine years in prison for tax evasion and fraud, ending a trial that critics say was a thinly veiled vendetta against a political rival of President Vladimir Putin.

Khodorkovsky was arrested by masked gunmen in fall 2003, kept in a metal cage during trial, and given only one year less than the maximum penalty sought by prosecutors, reported the New York Times.

Khodorkovsky, an ascendant oligarch and founder of the powerful Yukos oil company, was convicted of six charges, as was his Yukos colleague and codefendant Platon Lebedev. The men also were ordered to pay roughly $613 million in taxes and fines.

While few thought Khodorkovsky was wholly innocent of the charges, press reports suggested that the law had been selectively and brutally applied to him after he broke an unspoken rule and challenged Putin by funding rival political candidates.

Critics suspect that Putin targeted Khodorkovsky not only for stepping out of line but in order to take control of his company, which was largely dismantled after his arrest, with its primary asset becoming the property of Putin’s government after an auction some believed to be rigged, according to the Times.

Yukos released a statement denouncing the verdicts as “a gross travesty of justice produced by a judicial system that has not only been content to be maneuvered to destroy Mikhail Khodorkovsky, but also is intent on bringing down Yukos.”

U.S. Rep. Tom Lantos (D-Calif.), a member of the House’s International Relations Committee who traveled to the Russian court for the verdict, last week denounced the proceedings as a sham.

“This political trial, tried before this kangaroo court, has come to a shameful conclusion,” Lantos fumed. “The conclusion of this trial was predetermined politically.”

The Moscow government insists it was legitimately and simply cracking down on corruption.

Khodorkovsky and Lebedev are both expected to appeal their convictions.

Many observers say the targeting of Khodorkovsky has soured the business climate in Russia, spooking Western investors and sparking capital flight — which tripled to $7.9 billion the year after Khodorkovsky’s arrest, noted the Associated Press.