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Khodorkovsky quits as Yukos CEO

Russia’s richest man, who was arrested last month on fraud and tax evasion charges, resigned Monday as head of the Russian oil company Yukos, saying he wants to protect the company from any further damage.
/ Source: The Associated Press

Russia’s richest man, who was arrested last month on fraud and tax evasion charges, resigned Monday as head of the Russian oil giant Yukos, saying he wants to protect the company from any further damage.

“I am leaving the company,” Mikhail Khodorkovsky said in a statement on Yukos’ Web site, citing only “the situation that has developed.”

“As a manager, I have to do all I can to pull our workforce safely out from under the blows that are being directed at me and my partners,” he said.

The tycoon’s jailing on Oct. 25 amid a 4-month-old investigation of Yukos caused the company’s shares to drop, leading the Russian stock market into a plunge and raising concerns about the country’s economic recovery.

Russian Finance Minister Alexei Kudrin, in an interview published Monday, said the move by prosecutors to freeze shares in the embattled oil company was part of efforts to restore law and order. He predicted the probe will benefit the economy in the long run.

“One individual court case cannot revoke all the positive changes in the economy and society, everything that has already been done and is planned for development of the market in our country,” Kudrin, who is also a deputy prime minister, told the daily Kommersant.

Russia’s economy had grown for the past four years, and its stock market was thriving before it suffered a series of shocks during the Yukos investigation and plunged 15 percent last week after the arrest of Khodorkovsky and the subsequent share freeze.

Analysts worried the actions could endanger Russia’s recovery from its 1998 financial crisis, and the decision by a court acting at the request of prosecutors to freeze 44 percent of Yukos shares drew sharp criticism at home and abroad, with the State Department saying it raised “serious questions about the rule of law in Russia.”

Kudrin predicted the market will recover once the Yukos affair is over.

“Speculators on the market, of course, will have their fun for a while, but after the final court decision it will fully recover and begin to grow,” Kommersant quoted him as saying.

He also defended the share freeze, saying the court, “was motivated not by economic expediency but by the law.”

“The judicial branch is doing its business in terms of the restoration of law,” Kudrin told Kommersant.

Other top Russian officials, including Prime Minister Mikhail Kasyanov and President Vladimir Putin’s new chief of staff, Dmitry Medvedev, have expressed concern that the share freeze could hurt the economy.

Putin picked Medvedev last week to succeed Alexander Voloshin, the Kremlin chief of staff since his appointment by Putin’s predecessor, Boris Yeltsin, in 1999. Voloshin was seen as the top advocate of Khodorkovsky and other tycoons who won quick fortunes in controversial 1990s privatization deals.

Kudrin said Volshin’s resignation “coincided with the end of the Yeltsin epoch.” He added, “I know that for the economy of Russia it will be better.”

He said the arrest of Khodorkovsky — who is charged with fraud, forgery and tax evasion — and Voloshin’s departure mark a shift toward the rule of law and “honest competition” in business.

Critics say Khodorkovsky was targeted by Putin’s fellow ex-KGB officers in the Kremlin to curb his growing financial and political clout and to retaliate for his funding of opposition parties.

Human rights advocates say the authorities are using the courts as a political instrument, while the attack on Yukos has raised fears among business leaders that the Kremlin could launch a broad revision of privatization — though Putin has denied such plans.

“I’ve heard personally from (Putin) and clearly understand myself that this is not a redistribution of property and not a campaign against oligarchs,” Kudrin said.

In the statement, Khodorkovsky said he planned to continue his work for the Open Russia Foundation, which he founded in 2001, but he added: “Wherever I may work, I will do my all for my country, Russia, in the great future of which I firmly believe.”

Meanwhile, the newspaper Gazeta reported a major Siberian oil and gas field controlled until recently by a Yukos-affiliated company has been handed to another company.

The Natural Resources Ministry has given drilling rights to the Talakan field to Surgutneftegaz until a tender scheduled for the second quarter of 2004, Gazeta reported.

It said the license held by Lenaneftegaz, which is controlled by a company majority-owned by Yukos, expired last month.

Gazeta said the prosecutor general’s office has ordered the ministry to determine whether Yukos is a “conscientious user of natural resources.”