Russia's richest man denies fraud charges

Russia’s richest man Mikhail Khodorkovsky pleaded not guilty to all charges against him today, nearly eight months after his arrest at gunpoint at a Siberian airport.

Khodorkovsky, the former head of Yukos, Russia’s largest oil producer, faces charges including tax evasion and fraud and could receive a 10-year sentence if convicted.

He entered the plea in Moscow after prosecutors read the lengthy case against him and co-defendant Platon Lebedev, but the judge granted his request to delay making a full, formal response until tomorrow.

Lebedev also pleaded innocent, his lawyers said.

The case is part of a complex web of legal actions, including €3bn back taxes bill that Yukos says could force it into bankruptcy.

The state says the legal actions against Yukos and Khodorkovsky are part of an anti-corruption drive, but critics say they are Kremlin-led retaliation for the tycoon’s political aspirations and growing clout.

Khodorkovsky wrote a long jailhouse critique of the current state of Russian liberalism earlier this year, and he has spoken with reporters during breaks in court sessions.

But he has yet to publicly present his defence in the case, which has put his honour, the fate of Russia’s largest oil producer, and Russia’s reputation as a law-ruled state in peril.

Lebedev, asked earlier in the day if he understood the charges against him, said “I don’t understand what is going on in this court.”

The charges centre on the 1994 privatisation of a company that makes a key fertiliser component – one of the deals that helped Khodorkovsky build an empire that made him Russia’s richest man. Prosecutors say Khodorkovsky and Lebedev were part of an “organised group” that won a 20% stake in the company, Apatit, through a scheme involving shell structures that bid for the shares.

The trial is running as Yukos struggles for a compromise over the back taxes claim for 2000. Yukos is seeking a deal that would allow it to restructure its debts and keep the government from seizing its key assets.

Khodorkovsky stepped down as Yukos’ chief executive after his October arrest, but remains a major shareholder. He has proposed turning over his stock and that of close associates to settle the tax debt.