Russian investigators say ex-minister blocking probe

MOSCOW Fri Jan 11, 2013 1:02pm EST

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MOSCOW (Reuters) - Russian investigators accused former Defence Minister Anatoly Serdyukov on Friday of trying to obstruct their inquiry into a suspected $100 million fraud, the biggest corruption scandal of President Vladimir Putin's third term.

Serdyukov was fired by Putin in November after more than five years in office and is now a witness in a case in which a former subordinate, Yevgeniya Vasilyeva, is accused of fraud and embezzlement over deals involving Defence Ministry property.

Vasilyeva, 33, was charged in connection with a string of cut-price deals in which, investigators say, prime real estate was sold off to insiders at a loss to the taxpayer of at least 3 billion roubles ($98 million).

She was found to have paintings, rare antiques and more than 100 expensive rings when her apartment was raided in October.

The former minister, seen as a loyal Putin ally in years heading the Russia's tax inspectorate and the military, was summoned by the federal Investigative Committee for the second time and refused to answer questions, the committee said.

It said Serdyukov and his lawyer, Genrikh Padva, had "informally laid out their version of events in a way that benefits (Serdyukov), but did not answer uncomfortable questions of substance".

Padva said Serdyukov "had prepared answers to many questions that he understood could concern the prosecutors, and he presented them in written form and said he does not consider it possible to give any other evidence."

The Investigative Committee said it was Serdyukov's constitutional right to decline to give evidence against himself or relatives but that the choice prompted "puzzlement at the least" and warned that he could at some point become a suspect.

"In the given situation, the stance of the former defence minister can be regarded by the investigation as his effort to hinder the inquiry," the committee said in a statement.

The committee said it was "entirely possible" his status could be changed from witness to suspect.

It is extremely rare for a former Russian government minister to be prosecuted in a criminal case since the collapse of the Soviet Union in 1991.

Putin has made renewed promises to crack down on corruption in his new six-year term, which began in May, but critics say graft has worsened since he came to power in 2000.

Serdyukov, 51, made no comment as he left the Investigative Committee headquarters in Moscow. Vasilyeva, who is under house arrest in her large Moscow apartment, has not spoken publicly about the charges.

Russia ranked 133rd, alongside Honduras and Guyana, out of 174 states in Transparency International's 2012 Corruption Perception Index.

(Reporting by Gabriela Baczynska; Editing by Steve Gutterman and Robin Pomeroy)

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