Khodorkovsky May Benefit From Kremlin Panel’s Proposal for Crime Amnesty

The Kremlin’s human rights council called for an amnesty for economic crimes that would apply to Mikhail Khodorkovsky, the jailed former billionaire head of Yukos Oil Co.

“An amnesty can’t exclude specific individuals,” Tamara Morshchakova, a member of the council, set up in February by President Dmitry Medvedev, told reporters today in Moscow. “It would apply to all people accused of these crimes.”

Khodorkovsky, Russia’s richest man when he was arrested when on the tarmac of a Siberian airport in 2003, was convicted of fraud and tax evasion in 2005 and oil embezzlement in December 2010, charges he says are politically motivated. Medvedev, a former lawyer, has promised to uphold the rule of law and fight corruption as he seeks to attract foreign investment to boost growth to the level of China and India.

Khodorkovsky will spend 13 years in prison, including eight years he is serving on previous charges, after the Moscow City Court rejected an appeal to overturn his conviction in May. He was sent last month to a penal colony in Segezh in the Karelia region, near Finland, after previously serving his sentence in a prison in the Chita region near the border with China.

Medvedev said May 18 that freeing Khodorkovsky wouldn’t be “dangerous” for Russia as he called for faster action to modernize the economy.

Amnesty ‘Unlikely’

A decision to amnesty the jailed ex-Yukos billionaire is unlikely because it would bolster Medvedev at Prime Minister Vladimir Putin’s expense in the run-up to presidential elections next year, said Olga Kryshtanovskaya, a member of the ruling United Russia party.

Putin, 58, hasn’t ruled out a return to the Kremlin in March 2012 elections. He stepped down in 2008 having served two consecutive terms, the maximum permitted by the constitution, and picked Medvedev, 45, to replace him. The president has also said he may run in the elections.

“As a citizen, I would welcome it but I doubt this is realistic,” said Kryshtanovskaya, a sociologist who studies Russia’s elites, of the amnesty proposal. “Ahead of the elections, it would change the balance of power and strengthen the position of Medvedev. It would be a bold step with far- reaching consequences.”

Khodorkovsky, 47, whose fortune was once estimated at $15 billion by Forbes magazine, has accused Putin of persecuting him in revenge for his financing of opposition parties. Putin has denied any involvement in the case.

Tax Claims

Yukos, once Russia’s biggest oil company, was declared bankrupt and sold off in pieces after facing $30 billion of tax claims during Putin’s presidency. State-owned OAO Rosneft controls most of its former assets.

Medvedev has also sought to simplify rules for small businesses, which complain of routine extortion from local officials who use complicated regulation to extract bribes and, in some cases, force them to surrender ownership.

“There are statistics that show businesspeople have suffered mass repression like no section of society since the kulaks were wiped out,” said Morshchakova, referring to the Stalin-era campaign against wealthy peasants.

As many as 300,000 businesspeople are currently in Russian jails, equivalent to more than one in three prisoners, according to Yana Yakovleva, head of Business Solidarity, a lobbying group. One in six entrepreneurs have faced criminal proceedings, she said by phone.

Lighter Penalties

Yakovleva, the co-owner of Moscow chemical distributor Sofex Co., spent seven months in jail awaiting trial in 2006- 2007 before she was acquitted of trafficking in dangerous substances.

Medvedev has promoted lighter penalties for white-collar crimes, sought an end to pre-trial detention for those charged with economic offenses and expanded the use of bail.

An amnesty for all those convicted of economic crimes would be an essential starting point to change the behavior of law enforcement agencies, said Morshchakova.

“The government can send a signal that we are starting with a blank page by announcing an amnesty,” she said.

To contact the reporter on this story: Henry Meyer in Moscow at hmeyer4@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net

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