RUSSIA: Prosecutors raid Yukos-affiliated cos.

Investigators raided a number of companies connected to the shattered Yukos oil empire, prosecutors said Wednesday, as part of a $7 billion money-laundering probe.

Prosecutors in May indicated that they were pursuing money-laundering charges against Yukos' former owner Mikhail Khodorkovsky, who was sentenced that month to nine years in prison on tax and fraud charges. The sentence has since been reduced to eight years.

A spokeswoman for the prosecutor's office confirmed the new searches were under way, but would not say if they were linked to the May statement by prosecutors.
A statement posted on the Prosecutor General's Office Web site said investigators had uncovered information suggesting that managers and employees of Yukos had stolen money from 2000-2003 oil sales by paying dividends to front companies overseas.

Searches at four companies were "close to completion," the statement said.

Yukos spokeswoman Claire Davidson said she could not immediately confirm the raids, but noted that the company had repeatedly been visited by prosecutors. In the last six months of 2004, Yukos' downtown headquarters were searched hundreds of times, she said.

"It is disappointing to us that despite our efforts to engage with the Russian Federation to find an appropriate solution to this ongoing situation, we are once again the focus of an inappropriate, coordinated unfounded series of attacks," the company said in a statement released later.

Yukos' most important processing unit was acquired by a state-controlled oil company following its auction against a disputed, multibillion dollar back-tax bill. The company had once been Russia's largest oil producer, and investors' confidence has only recently begun to recover.

Observers called the case against Yukos a Kremlin-backed campaign to punish Khodorkovsky's funding of opposition parties in 2003.

• 107 Energy