RUSSIAN OLIGARCH PLACED
Vladimir Yevtushenkov, one of Russia's richest men, has been placed under house arrest on charges of money laundering in a case linked to his company's acquisition of Bashneft , the Russian oil producer.
Mr Yevtushenkov is the chairman and largest holder of AFK Sistema , one of Russia's largest private corporations. As well as Bashneft, Sistema's subsidiaries include MTS , one of the largest mobile operators in Russia, and Russian children's store Detsky Mir. It also has interests in healthcare, tourism and IT.
Forbes ranks Mr Yevtushenkov as the 15th richest man in Russia with a net worth of $6.8bn. Lord Mandelson, the prominent former British government minister and EU commissioner, sits on Sistema's board .
Russia's investigative committee, its equivalent of the Federal Bureau of Investigation, said on Tuesday that it was probing the alleged theft of shares in energy assets in Bashkortostan, a region in central Russia where Bashneft operates. It said investigators had "reasonable grounds" to suspect that Mr Yevtushenkov was involved in legalising property acquired by criminal means.
Sistema said in a statement that it considered the allegations against him "wholly unfounded" and said it would use all possible legal means to make its case.
The announcement that Mr Yevtushenkov had been placed under house arrest came in the wake of media reports that Rosneft , the state-controlled Russian oil group, was interested in buying Bashneft. Rosneft declined to comment on the reports.
Bashneft is one of the few Russian oil companies that is not under state control.
The news about Mr Yevtushenkov will inevitably evoke memories of the campaign against Mikhail Khodorkovsky, former head of Yukos oil company, who spent 10 years in prison after being convicted of fraud and tax evasion. His prosecution was widely seen as politically motivated.
Rosneft is headed by Igor Sechin, a close ally of Russian President Vladimir Putin. The company acquired many of Yukos' assets after Mr Khodorkovsky was imprisoned.
Sistema's troubles began earlier this year when Russian investigators opened a case linked to deals with Bashneft shares in the last decade. The case came as Bashneft planned an initial public offering of its shares in London. Sistema's shares in Bashneft were frozen in July.
Mr Yevtushenkov's arrest will deal another blow to Russia's investment climate, which has rapidly deteriorated this year in the wake of the Kremlin's annexation of Crimea and its involvement in the armed insurgency in eastern Ukraine.
Mr Yevtushenkov worked for the Moscow city government from 1987 until 1993, when he and a group of partners set up Sistema. The company started life selling Russian oil abroad and importing computers, and grew quickly during the chaotic 1990s.
Mr Yevtushenkov was an ally of Yuri Luzhkov, the powerful Moscow mayor who ruled Russia's capital from 1992 to 2010, and was also seen as close to Dmitry Medvedev, Russia's more reform-minded president who is now prime minister.
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