- The Washington Times - Tuesday, November 4, 2003

The Bush administration has taken a far more critical line in private conversations with the Russian government over its legal campaign against the man who became the country’s most powerful private oil executive, a senior administration official said yesterday.

The Oct. 25 arrest of Yukos executive Mikhail Khodorkovsky on fraud and tax-evasion charges has raised fresh questions about the rule of law in Russia and the commitment of President Vladimir Putin to political and economic reforms.

“There have been continuing conversations at very senior levels and they have been much more pointed than what we’re saying publicly,” a senior State Department official, speaking on background, told reporters yesterday.

Mr. Khodorkovsky resigned Monday in a move to insulate his oil company from his legal troubles.

Yesterday, Yukos officials announced that Simon Kukes, a Russian-born U.S. citizen and the company’s chairman since June, would serve as chief executive officer of the oil giant while Mr. Khodorkovsky fights the legal charges from his Moscow jail cell.

With the appointment of Mr. Kukes, who engineered the sale of the smaller Tyumen Oil Co. to British Petroleum Co. Ltd. earlier this year, Yukos’ top executive and the two senior executives of its flagship subsidiary are now all Americans.

The stunning fall of Mr. Khodorkovsky, once named the world’s richest man younger than 40, has roiled the Russian political and business worlds and unnerved foreign investors.

Having made his fortune in the widely criticized privatization deals after the collapse of the Soviet Union, Mr. Khodorkovsky embarked on an ambitious rehabilitation program, embracing Western-style corporate reforms and becoming a major financial backer of political parties and candidates hostile to Mr. Putin’s United Russia faction in parliament.

Russian state prosecutors have targeted several senior Yukos executives this year, but Mr. Putin told a group of Italian journalists at the Kremlin yesterday that there was no vendetta against a political critic.

The prosecutors “are acting correctly as long as they don’t go beyond the law,” he said, according to the government transcript.

Sergei Mironov, a close Putin ally who chairs the upper house of the Russian legislature, denied there was an ulterior motive behind the prosecution. He asserted that Mr. Khodorkovsky had failed to pay about $1 billion in taxes owed to the state treasury in recent years.

Mr. Mironov, who met with reporters during a visit to Washington yesterday, hinted that more charges may be filed against Mr. Khodorkovsky but denied there was any Kremlin master plan to void the massive privatization deals of the 1990s.

“There is no political motivation behind this,” he insisted.

Mr. Mironov did express unease with the decision to freeze about 44 percent of Yukos’ stock assets. That is far more than Mr. Khodorkovsky’s personal stake in the company.

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