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Posted by September 19, 2014

Russian Businessman Freed From House Arrest

Russian billionaire Vladimir Yevtushenkov was freed from house arrest on Friday, a company spokeswoman said, but the tycoon will have to stay in Russia to face money laundering charges over a deal to acquire a regional oil company.

There were conflicting reports in Russian media over whether the head of the Sistema telecoms-to-oil conglomerate had seen a change in the conditions of his pre-trial detention, which some in Russia's business elite said were too harsh.

The investigative committee, which charged Yevtushenkov, 65, in connection with a deal to acquire an almost 80 percent stake in oil producer Bashneft five years ago, was quoted as saying by Interfax news agency he was still under house arrest.

Other media said he was now allowed to use his phone.

"He has been freed from arrest," the spokeswoman said, declining to give further details. She said the company would most likely issue a statement on Monday.

The conditions of Yevtushenkov's detention, which some investors feared was a return to state intervention in the economy, were criticised by many in Russia's business elite, who said they were excessive for a man unlikely to flee after cooperating with the investigation since earlier this year.

Sistema was cited as saying on state TV that Yevtushenkov's form of pre-trial detention had been changed to only prevent him from leaving the country.

Prime Minister Dmitry Medvedev, attending a business forum in Russia's southern city of Sochi, was reported as saying that punishment for entrepreneurs could be changed to multiple fines in place of criminal prosecution.

The idea, unlikely to pass into law, appeared an attempt to calm critics, including Economy Minister Alexei Ulyukayev, who said Yevtushenkov's treatment would lead to more capital fleeing Russia.

President Vladimir Putin's spokesman Dmitry Peskov distanced the Kremlin from the case saying Putin had heard the news of Yevtushenkov's possible removal from house arrest from the media.

"An investigation is ongoing. It should be carried out fully. Correspondingly, no one should be considered guilty before it is proven in court," Russian Internet news outlet Dozhd quoted him as saying.

Russian stocks received short-lived relief after the news that Yevtushenkov had been freed from house arrest pending trial, with shares in Sistema spiking before settling 5 percent higher on the day at the close of trading.

The head of the Russian Federation of Industrialists and Entrepreneurs (RSPP), a big business group that controls two thirds of the Russian economy, said it had sent a letter to Putin criticising Yevtushenkov's house arrest.

"We're not trying to prove to the president or to social opinion that Vladimir Yevtushenkov is an angel, guilty or not, we believe the form of pre-trial detention is too harsh," union head Alexander Shokhin told Russian state TV.

Vladimir Markin, a spokesman for Russia's Investigative Committee, an agency which answers to Putin, was quoted as saying by Interfax that the conditions of the businessman's arrest and the charges had not changed.

Sistema has denied the charges, saying the acquisition of assets in the Bashneft was legal and transparent.


By Anastasia Teterevleva