24 May 2004 17:40
Chelsea owner may become next target for Kremlin prosecutors
Billionaire Chelsea boss Roman Abramovich may be the next target of Kremlin prosecutors after the remote region he
runs was declared bankrupt by Russia's highest audit body.
The Chukotka region has doled out questionable tax breaks to the magnate's oil company, said Russia's Audit
Chamber.
The strongly critical announcement suggests Abramovich and his Sibneft oil company might be the Kremlin's next
target of prosecution, after Yukos.
The nine-month probe into Yukos has crippled the company and led to the jailing of its former chief executive and a
top shareholder.
The probe into Yukos was widely seen as a politically motivated campaign to stifle the political clout of former
Yukos head Mikhail Khodorkovsky. Abramovich, however, has consistently maintained a much lower political profile,
despite his governorship of the Chukotka region in Russia's north-eastern corner.
Russia's Audit Chamber said that authorities in Chukotka had handed out tax breaks of pounds 263 million, most
of which went to 22 companies linked to Sibneft, according to reports.
Sergei Ryabukhin, an auditor with the fiscal watchdog, said the affiliates were only nominally registered in the
remote Arctic region and were not operating or producing anything there, making the tax breaks illegal.
He also told Russian television that 'for all practical purposes the region is bankrupt,' with a state debt
of pounds 178 million as of January 1, more than two and a half times the budget revenue of pounds 75 million.
A Sibneft spokesman played down the charges, saying the oil giant and its subsidiaries were operating in the region
and investing in oil exploration and other spheres.
Besides paying taxes in Chukotka -as well as other regions in which Sibneft operates -'we have been rebuilding a
region neglected by the federal government,' spokesman John Mann said.
When Sergei Stepashin, the head of the Auditing Chamber, announced the launch of the Chukotka audit, he said the
checks were routine. He added, however, that he had moral questions for Abramovich, whom he sought to cast as a big
spender who neglects Russia's woes.
Abramovich's purchase of the Chelsea last year was derided by some Russian officials, who criticised the
billionaire for not pumping his money into Russia's own struggling football clubs.
[The Birmingham Post] |
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