The arrest of billionaire and Russian telecoms and oil tycoon, Vladimir Yevtushenskov, stunned and triggered fears among the country's business community, dreading the return to the dark days of a decade ago when the Kremlin avowed its power by arresting Russia's hen-richest man and seizing his companies.
The arrest of Russian billionaire tycoon Vladimir Yevtushenkov, owner of Sistema Holding, has directed shares in his holding company into a nosedive Wednesday morning, September 17, 2014. Yevtushenkov, Russian's 15th-wealthiest man who is worth $9 billion (€7 billion)according to the Russian Forbes magazine, was placed under house arrest late Tuesday, September 16 and must now wear an electronic bracelet, in a money-laundering case which was comparable with a decade's ago government crackdown on the Yukos oil company.
According to a spokeswoman for Moscow's Basmanny court which ordered his detention, the 65-year-old Russian tycoon has been placed under house arrest until mid-November in his country residence outside Moscow and is banned from using the Internet.
The felonious case against Russian tycoon Vladimir Yevtushenkov struck the first attack on a billionaire businessman since the arrest of Yukos' former leader Mikhail Khodorkovsky in 2003, which was the Russia's largest oil company at the time. He consumed the next decade in custodial on tax evasion and embezzlement charges and saw his company taken over by the state and sold in pieces.
The prosecution of Khodorkovsky had sent a strong message to Russian oligarchs to keep out of politics and your assets will be safe. Russia's wealthy sectors have abided that rule for nearly a decade, and now fuss the implicit promise could be negated.
As per Economy Minister Alexei Ulyukayev's statement on Thursday, the arrest of Russian billionaire tycoon Vladimir Yevtushenkov on money laundering charges has stunned Russia's business community and could trigger capital fears. Onlookers believed Yevtushenkov's arrest symbols a crisis for Russian business as it hints that even loyal-Kremlin moguls are no longer invulnerable from prosecution. Finance experts are almost unanimous in saying that Yevtushenkov's house arrest is a course of action by the government and state-owned oil giant Rosneft to assume responsibility of his oil company, Bashneft. Rosneft sighted its oil output dropping and has been smash by Western sanctions, whereas Bashneft is relishing a roar, stationing an industry-leading 11.5 percent rise in oil production in this year's second quarter.
Russia's top criminal investigative agency, the Investigative Committee charged Yevtushenkov with money laundering and placed him under house arrest on Tuesday. He can face up to seven years in prison if found guilty.
The arrested Russian tycoon Yevtushenkov manages and reins Sistema, an expansive conglomerate which includes Russia's largest mobile operator MTS, Bashneft and other assets. With a market capitalization of $6.7 billion, Bashneft is one of the scarce oil companies still in private hands. Sistema's shares lost 38 percent by Wednesday late afternoon, dabbing more than $2.5 billion from its share value in just one tradeoff day.
Russia's investor buoyancy has been tattered this year by apprehensions over the economic penalties of Moscow's involvement in the Ukraine crisis. Since Russia's seizure of Crimea in March, the nation has been struck with series of US and EU sanctions. Venture capitalists are also distressed by the Kremlin's willingness to enforce import bans that are doomed as retribution against the West but are also affecting local companies and households.
The charges against the arrested Russian tycoon Yevtushenkov was due to Sistema's acquisition of oil assets in Bashkiria province in 2009. These assets were once state-run but altered before they were vended to Sistema. The prosecutors contend the seller had attained them unlawfully, making Sistema's purchase illegal.
Yevtushenkov's billionaire peers from the Union of the Industrialists and Entrepreneurs insist that the arrested Russian tycoon's company was a legitimate buyer. Sistema, which too has its stocks listed in London, said Wednesday its acquisitions of the oil assets were "legal and transparent" and it sworn to safeguard and them.
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