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Russian tycoon flies back into tightening prosecutors' net

MOSCOW, July 16 - Russian tycoon Mikhail Khodorkovsky flew back to Russia Wednesday as the net of investigations tightened around his Yukos oil group with the tax ministry ordered to probe the company and a new criminal inquiry reported.

Khodorkovsky, who had been at an elite business gathering in the United States attended by Microsoft founder Bill Gates, warned that the mounting campaign against him would provoke huge flight of capital from Russia.

But the oil billionaire vowed to pursue his business activities as he accused political forces of targetting him by misusing the law.

"It will be clear by the end of the year what damage the country has suffered from this," Khodorkovsky was quoted as saying by the Interfax news agency.

"Law enforcement agencies are using the law for personal interests. But I intend to continue work as normal. Investors have reacted nervously but we have kept the situation under control," the 40-year-old businessman added.

In the latest blow to the company, it was announced Wednesday that the Russian prosecutor general's office has ordered the tax ministry to carry out a probe into the affairs of Yukos.

"Last week, the prosecutor general's office ordered us to carry out an investigation into tax records at Yukos," deputy tax minister Rinat Dosmukhamedov told reporters.

Yukos is already facing three criminal investigations, including one involving a core shareholder, Platon Lebedev, who has been in jail since July 2 on charges of defrauding the state in a 1994 privatization deal.

And last week prosecutors said they had launched a preliminary investigation into tax evasion by Yukos and fellow-Russian oil firm Sibneft -- which are due to merge to create the world's fourth-largest oil producer.

Commentators have linked the prosecutors' moves to displeasure within the Kremlin at the growing political influence of Khodorkovsky, whose eight-billion-dollar (seven-billion-euro) fortune makes him Russia's richest man.

Powerful elements from the security services who wield influence in the presidential administration are said to be alarmed at the tycoon's financing of opposition parties ahead of December parliamentary elections.

Aluminium baron Oleg Deripaska has also come into prosecutors' sights over shares transactions in 2001, sparking concern about a general campaign against the club of billionaire businessmen who dominate the Russian economy after buying up the richest oil and metals resources in the 1990s.

President Vladimir Putin, who has refused to intervene so far, had agreed in 2000 soon after his election not to reexamine these dubious mass privatization deals if the so-called oligarchs kept out of politics.

But foreign investors have become alarmed at the lack of rule of law and threat to property rights and have warned of lasting damage to Russia's image. The Moscow stock market lost more than 10 percent last week.

A Russian daily meanwhile reported Wednesday that a fifth investigation was to be opened against Yukos.

The liberal Gazeta newspaper published an order signed by a senior investigator authorizing a criminal probe into a share deal by Yukos following a complaint by state-owned oil firm Rosneft.

The general prosecutor's office said it had no information on an inquiry being launched.

But Gazeta reported that prosecutors were now looking at the alleged misappropriation of a 19-percent stake in Yeniseineftegaz. The stake, Rosneft head Sergei Bogdanchikov claims, was unlawfully transferred to the Yukos-controlled offshore company Maastrade Limited.

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