Putin's former tormentor held in Athens

The former Russian media baron Vladimir Gusinsky appeared in an Athens court yesterday in the first phase of a battle against extradition to his homeland on multimillion-pound fraud charges.

The Greek prosecutor George Vlassis ordered the authorities to detain the 51-year-old former owner of the independent NTV television station until a second hearing later in the week. "It is set to be a long procedure," a court official told The Independent.

The one-time mogul was arrested on Thursday at Athens airport after travelling from Tel Aviv in Israel. He was carrying Russian and Israeli passports and his reason for travelling was unclear.

Confusion also surrounds the decision to detain Mr Gusinsky. Airport officials said they responded to an international arrest warrant, but separate reports suggested that police were acting under an agreement with Moscow. According to Interpol, the international police body based in Lyon, no arrest warrant has been issued. Two years ago, Interpol's general secretary, Ronald Noble, stated that Mr Gusinsky's case was politically motivated. Interpol's statutes ban it from interfering in political affairs.

The Greek government spokesman Christos Protopappas said the authorities had a warrant on their database. "From the minute there is a warrant in our archive - and we have an agreement with Russia - we have to carry it out," he said. "Greece can't ignore its international obligations."

The Greek court will need a formal extradition request to proceed but Mr Protopappas refused to confirm whether Moscow had lodged such a request. Court sources said the adjournment was necessary while Athens waited for Moscow to respond. Mr Gusinsky's lawyer said he would contest the legality of the arrest.

Mr Gusinsky was a member of an elite group of Russian businessmen known as the oligarchs who amassed fortunes from the new private sector in Boris Yeltsin's Russia. The media owner lost his businesses and fled to Spain in 2000 after falling out with the Kremlin, which unsuccessfully sought his extradition.

His arrest was made amid a row between the Kremlin and another oligarch, Mikhail Khodorkovsky, which has fuelled talk that President Vladimir Putin is reining in the super-rich elite in advance of parliamentary and presidential elections.

The oligarchs have a powerful voice through their links to the Russian opposition. Mr Gusinsky claims the charges against him are motivated by NTV's critical coverage of Mr Putin and the war in Chechnya.

A flurry of police raids last month ruptured a three-year peace pact between the Kremlin and the dozen or so super-wealthy but legally tainted oligarchs, who control an estimated 70 per cent of Russia's economic output. Russian police raided the offices of the Russian oil group Yukos. One of its top executives, Platon Lebedev, was arrested and its CEO, Mr Khodorkovsky - Russia's richest man - was interrogated about a decade-old privatisation scandal. Investigators have since charged the company with tax evasion and reopened five murder inquiries dating from 1998 that they say may be linked to the company.

Sergei Kolmakov, vice-president of the independent Foundation for the Development of Parliamentarism in Moscow, said: "These prosecutions are a typical showcase, using prosecutors to carry out political tasks. It's a pity, because three years of stabilisation in this country has been shattered with a single blow."

Roman Abramovich, the new owner of Chelsea Football Club, has been accused of avoiding the equivalent of £190m in taxes by Sergei Stepashin, head of the Russian parliament's Accounting Chamber and a close Putin ally. The implication was that Mr Abramovich, another billionaire oligarch, used the money that should have gone to the state to pay for Chelsea and a wave of subsequent lavish cash offers to lure top European players.

Mr Abramovich had been on the verge of merging his Sibneft petroleum firm with Yukos, a move that would create the world's fourth-largest oil major, second only to Exxon-Mobil in gas and oil reserves.

At the heart of the expanding police raids are renewed questions over the unsavoury manner in which Russia's powerful oligarchs acquired their vast holdings through smoke-and-mirrors privatisations in the 1990s. Most of them are wealthy today because they expropriated the former Soviet economy's crown jewels through insider trading, fixed auctions and corrupt Kremlin ties during the chaotic Yeltsin years.

The oligarchs banded together in 1996 to back the re- election campaign of President Boris Yeltsin against a strong Communist challenger, in a campaign marked by massive media manipulations, funding abuses and polling station corruption.

After Mr Yeltsin's victory, the tycoons were rewarded with unprecedented Kremlin access, and two of them - Boris Berezovsky and Vladimir Potanin - were given high government posts, which experts say they used to further their business interests.

President Putin came to power in 2000 pledging to install a "dictatorship of law" in place of the economic anarchy that thrived in the wild 1990s.

His message to the oligarchs was stark: if they halted their political meddling, the authorities would abstain from scrutinising the murky origins of their business empires.

Mr Putin's first year in power was marked by tough clashes with Mr Gusinsky and Mr Berezovsky, who refused to play by the new rules. Mr Gusinsky and the oil, auto and airline magnate Mr Berezovsky found themselves charged with criminal offences dating back to the 1990s and were gradually stripped of their property holdings and hounded into exile.