MOSCOW, December 14 - RAPSI. Investigators have initiated a criminal case against Alexei and Oleg Navalny on charges of fraud and money laundering, Investigative Committee official spokesperson Vladimir Markin told RIA Novosti.

"Oleg and Alexei Navalny embezzled over 55 million rubles ($1.7 million) from a trade company... In order to legalize the illegally obtained funds, the Navalny brothers transferred over 19 million rubles ($620,850) under false pretexts from a fly-by-night company to an account belonging to Kobyakovskaya Fabrika Po Lozopleteniyu (Kobiakovo Willow Weaving Factory), also founded by the brothers," Markin said.

Investigators found that Alexei Navalny is registered as the founder and general director of a company called Glavnoye Podpisnoye Agentstvo (Main Subscription Agency), but in fact he has not had anything to do with the company's activity.

While holding senior position with Russia's Postal Service, Oleg Navalny is accused of having "manipulated" a trade company into entering into a contractual agreement for cargo mail transportation with the Main Supscription Agency.

The enterprise transported mail from August 2008 till May 2011. While the real cost of the transportation amounted to no more than 31 million rubles ($1.02 million), over 55 million rubles ($1.8million) were transferred to the agency's account for transportation services allegedly rendered.

A fraud case has been initiated against the two brothers. The maximum punishment for this crime is ten years imprisonment.