Europe

Rostelecom Russia: Police search home of telecoms chief

Alexander Provotorov, head of Rostelecom, at a forum in the Russian city of Sochi, 16 September 2011 Image copyright Reuters
Image caption Alexander Provotorov has led Rostelcom since July 2010

Police have searched the Moscow home of the head of the Rostelecom telecoms company in the latest fraud inquiry involving state officials in Russia.

Backed by commandos, they searched Alexander Provotorov's residence in an elite suburb, Russian media report.

The nearby home of a minority shareholder in the company, Konstantin Malofeyev, was also searched.

Neither man has been arrested in the case, which Mr Malofeyev suggested was to do with corporate politics.

The case relates to an investment fund owned by Mr Malofeyev.

There was no immediate comment from Mr Provotorov while the fund, Marshall Capital, said Mr Malofeyev and his legal representative, Dmitry Skuratov, were being "treated as witnesses".

Since Vladimir Putin was re-elected as Russian president in March, a number of high-profile corruption scandals have emerged.

The best-known of these involved Anatoly Serdyukov, who was sacked as defence minister earlier this month during an investigation into the sale of ministry assets at prices below market value.

'Pictures seized'

A Russian criminal inquiry is under way into Marshall Capital over a loan of $225m (£141m; 176m euros), which was granted in 2007 by the British arm of Russian bank VTB, VTB Capital Plc.

It was given to a company called Russagroprom in order to buy dairy farms in Russia from a food producer called Nutritek, co-owned by Marshall Capital.

Russagroprom defaulted on the VTB loan and the bank brought proceedings against Nutritek and Marshall Capital, securing a British court order freezing part of the fund's 10% stake in Rostelecom.

Mr Provotorov was director-general of Marshall Capital from 2005-2009, and in July 2010 became head of Rostelcom, Russia's former fixed-line telephone monopoly, which is valued at $12bn.

Two police teams swung into action at around 06:00 (03:00 GMT) on Tuesday, raiding the homes of Mr Provotorov and Mr Malofeyev in Odintsovo, Russia's Kommersant business newspaper reports.

The two men handed over documents during the searches, and a picture collection was reportedly seized at Mr Malofeyev's property.

Mr Malofeyev was himself brought in for questioning and an office of Marshall Capital was also searched.

Speaking later to liberal TV channel Dozhd, Mr Malofeyev said: "My version is that this is pressure for the purpose of replacing the Rostelecom management."

An interior ministry spokesman quoted by Russia's Ria-Novosti news agency said the investigation was not related to Rostelecom.

In another development on Tuesday, the director-general of Russagroprom, Yevgenia Kremneva, was also questioned, Russian media report.

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