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MOSCOW (Reuters) - A lawyer whose gruesome jailhouse death spooked investors and blackened Russia's image probably was beaten to death in pre-trial detention, the Kremlin's human rights council said in a report published on Wednesday.
Sergei Magnitsky, a lawyer for the equity fund Hermitage Capital, whose British-based head fell foul of the government during Vladimir Putin's presidency, died in November 2009 after nearly a year awaiting trial on a tax evasion charge.
Colleagues allege that the case against Magnitsky was fabricated by police investigators whom he accused of stealing $230 million from the state through fraudulent tax returns, and say his death was the result of a conspiracy led by the same officers.
Magnitsky's death has turned into a test of President Dmitry Medvedev, who has vowed to reform a justice system he says is badly flawed but is seen as having made little progress since he was steered into the Kremlin by Putin in 2008.
The report, which Medvedev's human rights council presented to him on Tuesday, added to allegations that Magnitsky had been mistreated and denied adequate medical care in jail, particularly in the last days and hours of his life.
Shortly before his death, a prison doctor who complained that Magnitsky was acting irrationally summoned a team of eight guards, who handcuffed Magnitsky and took him to a small room, where a first aid unit was denied access, the report said.
"Before his death, Magnitsky was completely deprived of medical help. Additionally, there are grounds to suspect that Magnitsky's death was the result of a beating," it said.
"His relatives afterward found that he had broken fingers and bruises on his body. Moreover, there is no medical record for the last hour of his life," it said.
The council, an advisory body that includes respected human rights and judicial reform advocates, also accused a judge of committing Magnitsky to pre-trial detention without just cause and suggested the tax fraud charges against him were fabricated.
The council said the case against Magnitsky was marred by an obvious conflict of interest, because it was conducted by the same investigators he testified against after Hermitage accused Interior Ministry officers of a multi-million-dollar fraud.
"The case linked to Sergei Magnitsky was investigated by the very same employees of the Interior Ministry and of the investigative committee against whom he made accusations," the report posted on the council's website said.
"This conflict of interest testifies either to negligence or to a particular interest on the part of those leading the investigation."
Medvedev, who had ordered an official probe shortly after the attorney's death, made no public comments after hearing the council's report on Tuesday but said it would be handed to investigators.
Medvedev ordered the sacking of several prison officials after Magnitsky's death, but former colleagues including Hermitage founder William Browder say justice will not be done until the officers they blame face criminal charges.
Rights activists say the fact that nobody has been prosecuted demonstrates Medvedev's inability to make major changes and emerge from the shadow of Putin, who may return to the presidency himself in March 2012 election.
Hermitage was once Russia's biggest equity fund but Browder, who had campaigned for better corporate governance, has pulled money out of the country after he was denied entry in 2005 and relations soured.
Lawmakers in countries including the United States and the Netherlands have introduced legislation that slaps travel restrictions on dozens of investigators, prosecutors, judges and other officials whom Hermitage blames for Magnitsky's death.
Magnitsky's death sent a warning to potential investors in Russia, which trades at a discount to other emerging markets because of risks associated with corporate governance and misuse of funds, and drew fierce criticism from foreign governments.
Writing by Alissa de Carbonnel; Editing by Steve Gutterman and Michael Roddy;