Russia To Search Hermitage Official’s London Home

Sep 8 2010 | 12:00pm ET

Despite the international outcry following the death of one of its lawyers in prison, Russia is continuing its investigation of Hermitage Capital Management, taking its probe onto the London-based hedge fund’s home turf.

The Russian Interior Ministry, which is investigating the hedge fund for tax evasion and whose own officials have been accused of defrauding Hermitage of US$230 million, has won a search warrant for an unidentified Hermitage executive’s London address. Russia has also asked Interpol for help finding six other lawyers linked to Hermitage who are believed to be in London, The Independent reports.

Sergei Magnitsky, a lawyer for Hermitage, died in a Moscow prison in November after a year in custody. Human rights activists say he was tortured and denied adequate medical care. The Council of Europe, of which Russia is a member, has also blasted the investigation into Hermitage, once the largest foreign investor in Russia, as politically-motivated. Hermitage chief William Browder has been an outspoken critic of corporate governance in Russia.

Russia is also seeking the arrest of Hermitage’s Ivan Cherkasov, who is also in London.

“If Major Silchenko seriously thinks he can come to London and try the same thing here,” Browder told the Independent of Oleg Silchenko, the Russian Interior Ministry official who signed the arrest order for Cherkasov, “he will find himself in a legal mess so large, he will need a very good lawyer for a very long time.”

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