Tornado Alley (PROG)

[StephanieVanbryce]

From AM - another board

http://www.investorshub.com/boards/board.asp?board_id=2301

Khodorkovsky didn't receive severe sentence, guilty of treason

Pertinent facts are being omitted by the press.

Background:
Putin referring to the United States said "Some would like to cut a juicy piece of our pie. Others help them," he said. "Terrorism is just one instrument they use."

One way in which we were to cut a piece of their pie may be glimpsed in the Khodorkoysky affair. A close scrutiny shows the Khodorkoysky case was in essence a means by which the United States could invade Russia by gaining not only control of Yukos but a foothold in their Duma.

Another problem connected to YUKOS—the issue of buying seats in the Duma—has been noticeably less discussed. YUKOS is accused of not limiting its lobbying to “one-time” deals, but generously “sponsoring” various parties to cobble together its own Duma “faction.” Other oligarchs do similar things, but not on the same scale as YUKOS.
http://www.gateway2russia.com/st/art_164082.php

This is how generously they were sponsoring.

The Russian president and the former secret police members who now dominate his staff struck at Khodorkovsky when it became clear that the billionaire was preparing to spend $100 million to win a large bloc of seats in Duma elections next month and eventually to run for the presidency himself.
http://seattlepi.nwsource.com/opinion/147219_hoagland7.html

Exxon Mobil originally meant to buy a controlling interest in Yukos, only later did they back down to 40%.

Therefore the merger in its original intent would have given Exxon Mobil, a foreign entity, seats in Duma.

The sale of Yukos shares to a U.S. company would entail that representatives of American big business would be sitting in the Russian parliament. Russia would cede its sovereignty if it allowed transfer of strategic assets to corporations that are, in turn, closely linked to foreign governments. This would be like having a representative of Russian business in the U.S. congress voting on or blocking key legislation relating to the national interest. Knowing that Khodorkovsky has been siphoning profits from the impoverished Russian people under the umbrella of privatization compliments of democracy and is associated with not only the Carlyle Group but the elder Bush and others it becomes painfully obvious that his allegiance is with the United States and not Russia yet he would be president. This is betrayal, he’s lucky Putin does not try him for treason.

The sovereignty of Russia was being challenged albeit in a small way but nevertheless a precedent Putin could not ignore. Khodorkovsky was plotting against his own country.

Our objective has always been to contain Russia, keeping them in abject poverty by controlling pipelines and limiting Russia’s ability to get their oil and gas to market.

-Am

Russia's Khodorkovsky jailed for 9 years
Tue May 31, 2005 09:34 AM ET


By Christian Lowe and Dmitry Zhdannikov
MOSCOW (Reuters) - Russian oil magnate Mikhail Khodorkovsky was sentenced to nine years in a prison camp on Tuesday after being found guilty in a tax evasion trial widely seen as orchestrated by the Kremlin to crush a political rival.

"My sentence has been decided in the Kremlin," an unrepentant Khodorkovsky, 41, said in a statement read to reporters by his lawyer.

The severity of the sentence -- a year short of the maximum demanded by the prosecution -- is certain to stoke concerns in the West and among investors about the high risk of doing business in President Vladimir Putin's Russia.

The central Moscow court found the billionaire guilty of six of seven charges of fraud and tax evasion in a verdict that took judges 12 days to read and which climaxed an 11-month trial.

Khodorkovsky's YUKOS business associate, Platon Lebedev, was handed the same sentence. Both plan to appeal.

"Khodorkovsky and Lebedev entered into an organized group with the aim of illegally appropriating other people's property and then selling the assets for their own gain," said chief judge Irina Kolesnikova.

"The court finds (the defense arguments) to be groundless."

A charge of repeated forgery of documents was dropped.

Standing to hear the sentence, Khodorkovsky looked straight ahead and showed no emotion as it was read out.

Outside the heavily guarded court, his supporters shouted "Shame!."

The verdict produced a gasp from Khodorkovsky's female relatives, one exclaiming: "How could you do that to a person?"

After the verdict, the prosecutor general's office said there would soon be new charges against him but gave no details.

Khodorkovsky and Lebedev were both sentenced to a prison camp where inmates live in barracks with relative freedom to move around within the grounds of the jail. But they will stay in their Moscow jail until appeals have been exhausted.

LITTLE SYMPATHY IN RUSSIA

If the sentence stirs unease in the West, Khodorkovsky's plight is unlikely to elicit support from ordinary Russians.

They mostly view the hugely wealthy, and usually young, oligarchs like Khodorkovsky who emerged from the ruins of the Soviet Union as little more than thieves of state wealth who left them even worse off than under communist rule.

Khodorkovsky has spent nearly 20 months in jail and Lebedev almost two years, time that will be taken off their sentences.

The billionaire, once Russia's richest man and founder of the YUKOS (YUKO.RTS: Quote, Profile, Research) oil company, and Lebedev had faced charges including fraud, theft and tax evasion.

The company has since been crushed under the weight of back tax claims and its core assets passed into state hands.

"(We) see this sentence as an incredible perversion of justice ... this system not only readily fulfilled the order to destroy Mikhail Khodorkovsky, but, it seems, wants to ruin YUKOS itself," YUKOS said in a statement.

After the verdict, the stricken oil firm said it would file a 324 billion rouble ($11.53 billion) suit against the Russian government in compensation for the enforced sale of its main asset, now in the hands of a state firm.

The judges had made clear from the start of their summing up that the accused would be found guilty.

VERDICT EXPECTED

"There was no reason to expect a soft sentence," said Masha Lipman, political analyst at the Carnegie Moscow Center who said the judges had so taken the side of the prosecution they had reportedly even repeated its spelling and arithmetical errors.

"Nobody has any illusions the court was independent, not even the broader public. The sentence had to be long enough so Khodorkovsky was in jail in 2008, at the next presidential elections."

The United States had voiced its concerns earlier that the trial has undermined investor confidence in Russia.

"This political trial before a kangaroo court has come to a shameful conclusion," U.S. Democratic representative Tom Lantos said outside the court.

"The conclusion of the trial was pre-determined politically ... we will watch with great interest at the appeal process and what happens from here on."

Britain's ambassador to Russia, Tony Brenton, warned the outcome of the trial could have a major impact on business and investor confidence in Russia. (Additional reporting by Meg Clothier, Andrew Hurst, Darya Korsunskaya, Tom Miles and Elif Kaban)

http://www.reuters.com/newsArticle.jhtml?type=topNews&storyID=8652623