Moscow, Nov. 11 (Reuters): A Moscow court denied bail today to oil magnate Mikhail Khodorkovsky and ordered him to remain in prison pending an investigation into charges of fraud and tax evasion.
The ruling was issued after a closed hearing at which Khodorkovsky, former chief executive of Yukos, appeared briefly by video link. It was the first time he had been seen in public since his dramatic arrest on October 25. As the session opened, Khodorkovsky smiled wryly when the judge said the hearing, to rule whether he could be detained further or released on bail, should be closed and ordered journalists and observers to leave.
Khodorkovsky, who faces seven charges of tax evasion and massive fraud, answered questions confidently. It was the first time he has been seen publicly since he was arrested at gunpoint and dragged off a plane when it touched down to refuel in Siberia.
Khodorkovsky, rated Russia’s richest man with a personal fortune estimated at $8 billion, was filmed behind bars in prison and confirmed his name to the court.
“I support the position of my lawyers,” said Khodorkovsky, whose prosecution analysts say is prompted by Kremlin worries over his political ambitions.
The prosecutor general’s office had already said it wanted to keep Khodorkovsky in jail until December 30 and few had expected the court to bow to the request to release him. But Robert Amsterdam, a lawyer acting on behalf of Khodorkovsky, said in Oslo: “There is no reason under the Russian criminal code to keep him in jail... he is a political prisoner.”
Chris Granville, chief strategist at Moscow-based investment bank UFG, said prosecutors had the argument that when suspects were rich and influential, “they could use their wealth and influence to suppress evidence”.
Lawyers for Platon Lebedev, a close ally of Khodorkovsky and a fellow Yukos shareholder who was arrested in July, have failed repeatedly to secure his release on bail.
Khodorkovsky’s arrest has shaken confidence among investors in Russia and triggered concerns it may signal increased state interference in business.
Yukos shares, weak all day, fell two more percentage points after the court declared the hearing closed.
The conflict blew up in July, when police arrested Lebedev. A few days after Khodorkovsky’s arrest, prosecutors froze a 40 per cent block of shares in Yukos belonging to Khodorkovsky and his allies.
Lawyers acting for Khodorkovsky are believed to be planning a separate appeal against that decision.
Analysts say the Kremlin has instigated the investigation to punish the billionaire for his political activities and strong parliamentary lobbying to frustrate moves by the Kremlin to increase taxation of oil companies.
Khodorkovsky’s lawyers said they wanted a panel of foreign observers to monitor the case and predicted that it would end up at the European Court of Human Rights.