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Russia to charge boss of lawyer in posthumous trial

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(Globalpost/GlobalPost)

Moscow police said on Tuesday they would press fresh charges against the US employer of a Russian whistleblowing attorney who died in prison but is still facing an unprecedented posthumous trial for tax evasion.

The new claim against Hermitage Capital investment fund founder William Browder came a day after a Moscow court set March 11 as the date for the posthumous trial -- the first of its kind in Russia -- of his former accountant Sergei Magnitsky.

Tuesday's announcement appears aimed at driving public opinion further against Browder in a case that has assumed much broader diplomatic repercussions for Moscow's relations with Washington.

Magnitsky died in prison in 2009 less than a year after being arrested upon revealing a $230-million fraud scheme allegedly run by senior Russian interior ministry and tax officials.

He was put in jail and was later himself charged with stealing the money by those whom he had accused of organising the original crime.

No one has been convicted over his death or the $230 million theft from the Russian federal budget despite President Vladimir Putin's vows to crack down on corruption and institute the rule of law.

The case has inflamed tensions between Moscow and Washington and resulted in tit-for-tat sanction measures and even legislation barring US families from adopting Russian children.

The new charges against Browder were read out live on state television's rolling news channel in a sign of the importance Moscow attaches to the case.

A senior police official said the new charge against Browder will concern shares he acquired in Russia's natural gas monopoly Gazprom for Hermitage Capital -- the biggest foreign investor in Russia at the time.

A now-revoked presidential decree had made fast-rising Gazprom stock available for purchase only by Russian nationals and foreigners who had special permission from the state.

Browder is alleged to have used offshore companies registered in the names of Russian nationals to purchase the stock. The scheme is widely believed to have been practised by most other large foreign investors in Russia.

Interior ministry official Mikhail Alexandrov told reporters the arrangement amounted to theft of Gazprom stock worth 2.134 billion rubles ($70 million).

"Browder was illegally receiving shares between 2001 and 2004," Alexandrov said in televised remarks.

Browder defended minority shareholder rights by acquiring small stakes in big Russian companies such as Gazprom and then attempting to get access to financial records that could expose theft and graft.

Alexandrov said Browder used his shares to try to gain access to secret Gazprom records and to the company's board.

Browder was expelled from Russia without an explanation in 2005 after initially proclaiming his support for Putin.

Hermitage Capital was forced to move its headquarters from Moscow to London as a result.

Browder has refused to travel to Moscow for questioning in the Magnitsky trial and appeared unlikely to be willing to travel to Russia to face the new charges now.

He has used his time instead to get EU states to follow the US example and pass a so-called Magnitsky Act that slaps travel bans against officials who investigated Magnitsky and then put him on trial.

Hermitage Capital issued a statement denouncing the new charges as a "poorly disguised attempt by officials to keep the Magnitsky Act from being adopted in Europe that appears to be orchestrated directly by the Kremlin."

"All transactions with Gazprom shares were conducted in strict accordance with the law applicable at the time," the statement added.

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http://www.globalpost.com/dispatch/news/afp/130305/russia-charge-boss-lawyer-posthumous-trial-0