MOSCOW, September 18 - RAPSI. The Moscow Dorogomilovsky District Court sentenced Yuri Privalov, former head of a Sovcomflot (SCF) subsidiary, to 4.5 years in prison for embezzling $67 million, the court spokesperson told the Russian Legal Information Agency (RAPSI/rapsinews.com) on Tuesday.
The court also obligated Privalov to pay a fine of one million rubles ($32,630) to the state.
On Monday, the court established Privalov's complicity in a large-scale embezzlement as part of an organized criminal group.
As Privalov did not attend the trial, the sentence was announced in his absence.
When making his last plea, Privalov admitted his guilt in full. He said he had done everything he could to remedy the situation and return Sovcomflot and Novoship the stolen assets. Privalov told the court that he partially compensated the damages by assigning them around $4 million: he handed over a residential house in London worth almost ?2 million to Novoship and transferred $2 million to Sovcomflot. He requested the court to take into account the mitigating circumstances and impose any punishment but imprisonment.
Sergei Polevoy, the representative of the aggrieved party, submitted a similar request to the court. On behalf of Novoship and Sovcomflot he highlighted Privalov's active assistance in compensating for the damages incurred by the companies.
Privalov's defense is determined to appeal against the sentence, his attorney told the Russian Legal Information Agency (RAPSI/rapsinews.com), insisting that Privalov should be given a suspended sentence.
Investigators claimed that Privalov and other members of an alleged criminal group embezzled funds from Sovcomflot and Novoship subsidiaries between 2000 and 2005.
The Investigative Committee said that the money was misappropriated by overstating commissions payable to foreign brokerage companies for the conclusion of purchase and sale transactions for Novoship and Sovcomflot ships. After payment was received, the margin was transferred to the accounts of companies controlled by the accused. The total sum embezzled came to over $67 million.
As Privalov made a plea bargain, his case was considered without a full examination of the evidence or witness interrogation.
Sovcomflot and its subsidiaries were in litigation with former Sovcomflot CEO Dmitry Skarga, former CEO of SCF British subsidiary Fiona Maritime Agencies Yuri Privalov, former Novoship President Tagir Izmailov and businessman Yuri Nikitin for over five years until 2010. The claims amounted to a total of more than $800 million. Sovcomflot won $150 million following the litigation.
Sovcomflot is Russia's largest fully state owned shipping company. Its fleet consists of over 150 ships.
