May 24th, 2011

Investment Risk in Russia Rises as Khodorkovsky Conviction Upheld

Reuters

Pavel Ivlev, founder and chairman of the Committee for Russian Economic Freedom, condemned today’s verdict by the Moscow City Court upholding the false conviction of Mikhail Khodorkovsky, former Yukos CEO and Russia’s most well-known political prisoner, saying the result compounds investment risk in Russia.

Putin’s regime today put its own greed ahead of the interests of ordinary Russians who are starved for the capital they need to bolster their economy, create jobs and modernize the country,” Ivlev said. “The court’s decision mocks the rule of law and reconfirms the wide-held belief that it’s unsafe both physically and financially to invest in Russia.

Khodorkovsky and his business partner and co-defendant Platon L. Lebedev were found guilty by a lower court in Dec. 2010 on a second round of trumped up charges stemming from bizarre allegations that they embezzled the entire production of the Yukos Oil Company from 1998 to 2003. Today, the Moscow City Court upheld the verdict. Both men, who have been in jail since 2003, now face prison camp terms through at least 2016.

Years after Russia began its so-called modernization, the country still looks very much as it did two or three decades ago, where individuals can be locked up indefinitely based on little or no evidence,” Ivlev said. “Investors should be wary of putting their money in a country where the judiciary fails to follow the rule of law and where the rulers pick the market’s winners and losers.”

Khodorkovsky, who entered the Moscow courtroom to applause, spoke about the Dec. 2010 verdict, saying,

In what dusty cellar did they dig up that poisonous Stalinist spider who wrote this drivel? What kind of long-term investments can one talk about with such justice? No modernization will succeed without a purging of these cellars.”

“There is no way to correct this verdict,” Khodorkovsky continued. “Either overturn and terminate this shamefulness, or join ranks with the criminals, who spit on the law. I have nothing to talk about with criminals, even those in a judge’s robe. And indeed there is no reason for me to. I do not need mercy from criminals.”

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