- The Washington Times - Tuesday, April 21, 2009

MOSCOW (AP) - Imprisoned former oil tycoon Mikhail Khodorkovsky entered a not guilty plea on Tuesday to new embezzlement and laundering charges that are widely seen as politically motivated.

He and imprisoned business partner Platon Lebedev are accused of embezzling more than $25 billion worth of oil from subsidiaries of his Yukos oil company and laundering most of the proceeds.

“No, I do not admit my guilt,” Khodorkovsky said calmly, standing in a steel-and-glass cage. “If I stole the oil … and profits while the state got 40 billion rubles in taxes, what were the taxes paid for?” he added.

Lebedev, who also pleaded not guilty, called the charges “schizophrenic” and “blatantly falsified.”

Meanwhile, a different Moscow court granted parole to a former Yukos lawyer imprisoned on charges widely seen as part of the state campaign against Khodorkovsky.

Svetlana Bakhmina, serving a 6 1/2-year prison term for embezzlement and tax evasion, gave birth while in detention in November. She was denied parole twice while she was pregnant, to the anger of rights activists who argued pregnant women who did not commit violent crimes are typically granted early release.

Her plight also prompted a petition calling for a presidential pardon. She was transferred to a clinic near Moscow and gave birth to a girl last year.

Khodorkovsky and Lebedev, who face up to 22 years in prison if convicted, describe the new charges as nonsense, saying they amount to an accusation that Khodorkovsky stole all the oil produced by Yukos from 1998 through 2003.

“The claim that 350,000 tons of liquid (oil) have been stolen or hidden makes no sense,” Khodorkovsky said. “It’s no bucket of paint stolen from a store.”

Khodorkovsky, once Russia’s richest man, has been imprisoned since his arrest in 2003. In 2005, he was sentenced to eight years in prison on fraud and tax evasion charges. The accusations were seen as part of a Kremlin-driven campaign to punish him for challenging then-President Vladimir Putin and to increase state control over oil revenues.

The pair’s supporters claim the second trial is just a new phase of a reprisal campaign driven by political calculations, commercial interests and personal motives.

“The main problem of state prosecutors and the small-time corrupt vermin who profited on dismantling Yukos and who tried to stage this process is the need to cover their petty, greedy interests with lofty political goals,” Khodorkovsky said.

The trial is being watched for signs of more judicial independence under Putin’s successor, President Dmitry Medvedev, a former lawyer who has stressed the importance of the rule of law.

Khodorkovsky, however, remained skeptical about Medvedev’s pledges.

“As president’s words are one thing, and (his) practical steps are the other, the new Yukos trial is very significant, almost symbolic,” he said while prosecutors tried to shout him down.

Defense lawyers argue that Khodorkovsky and Lebedev, meanwhile, are being tried a second time for the same actions. They say the tax evasion charges in his initial trial were based on the same oil pricing and trade practices that the state is now using as the foundation for the embezzlement and money-laundering charges.

The state’s claims are based largely on the difference between the relatively low prices Yukos paid production subsidiaries for what came out the wells and the higher prices Yukos and related companies received for the oil sold abroad. Khodorkovsky’s legal team says such pricing mechanisms are common practice, but at the time shareholders in the production companies claimed bitterly that they were being robbed of their rightful profits.

Yukos, once Russia’s largest oil producer, was declared bankrupt in 2006 and by 2007 had been sold off in auctions ordered by the state to pay off billions of dollars in alleged back taxes. Much of the company’s assets were purchased by the state-controlled oil company Rosneft, which in turn became the country’s biggest oil producer.

Khodorkovsky and his supporters have blamed powerful deputy prime minister and Rosneft chairman Igor Sechin of being a driving force behind the crackdown on Yukos.

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