Billionaire foe of Putin arrested

Russia's richest man, Mikhail Khodorkovsky, was sitting in a Moscow jail cell Sunday after a dramatic arrest which some experts believe could herald confiscation of his company, Yukos, the world's fourth-largest oil producer.

The arrest comes amid longstanding tensions between the government of President Vladimir Putin and Russia's oligarchs, who grew wealthy by buying state assets cheaply in rigged auctions after the USSR collapsed.

The allegations against Mr. Khodorkovsky - including fraud, forgery, theft, and tax evasion - relate to the murky decade-old privatization of a state-owned fertilizer company. But experts say the investigation of Yukos and the arrest of its chief are actually aimed at punishing Khodorkovsky for his political activism. The businessman is backing opposition parties running in December parliamentary elections.

"This is clearly an effort by people at the top to demonstrate that tycoons should think twice before involving themselves in politics," says Irina Zvigelskaya, an expert with the Center for Strategic and Political Studies, an independent Moscow think tank. "It's a political operation, not primarily a legal one."

But a spokeswoman for the prosecutor's office in Moscow characterized the arrest as an attempt to punish economic wrongdoing. The damage done to Russia's economy by Khodorkovsky was "in excess of $1 billion," she said, and he is "implicated in a series of crimes, including theft by fraud on a large scale, [and] the failure to pay taxes as an organization and as an individual."

Khodorkovsky responded through his lawyer: "I'm not sorry for anything I've done, nor am I sorry about what's happening now."

His arrest climaxed five months of cat and mouse between the outspoken entrepreneur and state prosecutors, whom most experts believe are acting on Kremlin orders. Two of Khodorkovsky's chief lieutenants have been in prison since July, a third has fled the country, and others have seen their offices and homes ransacked by security police.

Khodorkovsky could face up to 10 years in prison if convicted. On Saturday, a Moscow court gave prosecutors the right to hold him in pretrial detention until at least December while the investigation continues.

The businessman was seized in an early morning raid Saturday by heavily armed agents of the FSB security service, the KGB's successor, who surrounded and boarded his private plane as it was being refueled at a Siberian airport.

"They rushed aboard the plane shouting: 'FSB, drop your weapons,' " Alexander Shadrin, a press spokesman for Yukos, told the Ekho Moskvy radio station. "They used special forces in the same way they would deal with a terrorist attack."

In recent weeks, police have raided a Yukos-funded orphanage, the offices of the chief lawyer handling the company's legal defense, and the dachas of several of the firm's top executives.

On Thursday, prosecutors took over a Moscow public- relations firm that has been handling the parliamentary election campaign of the liberal Yabloko Party, seizing computers, documents, and funds belonging to the party.

Khodorkovsky has openly supported Yabloko, which is the main liberal opposition to the Kremlin. Some experts say the oil tycoon has also funded the Communist Party, with the strategic aim of preventing pro-Kremlin parties from gaining a majority in the State Duma in the vote, slated for Dec. 7.

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