"I Miss the Sun", interview to Russian Newsweek (1.31.2005)

Mikhail Khodorkovsky was once one of the richest men in the world. Now he languishes in a Russian jail. Disheartened and disillusioned, he accepts that his career as a businessman is over; his career as a citizen continues. Khodorkovsky gives his first interview from jail in a move that will further inflame the Kremlin.


Did you ever think that your imprisonment would last this long?

Yes. I honestly did, I warned my friends and family, they didn’t believe me. They thought I was showing off. Unfortunately, the duration of my imprisonment depends not on the court, but on several bureaucrats and businessmen who fear that I may start avenging my own hardships and Yuganskneftegaz.

Do you have any idea as to when you will be released?

I don’t know. Maybe when the authorities only have their power, and the courts are independent, not a mechanism for redistributing property. Maybe this year, maybe never.

Why did the authorities view it as necessary to arrest you?

At the end of October 2003 President Putin was misinformed that I was planning to become the Senator of Evenkia (East Siberia), which would grant me immunity. So I was seized on a Saturday morning in a plane in Novosibirsk. I was indeed going to Evenkia, to support my friend Vassilii Shakhnovskii’s election to the Federation Council. Everyone knows this now.

In addition, I think that it was important for the organizers of the attack on Yukos to cross a metaphorical “red line”, forcing themselves and everyone else to play to the bitter end, so to speak. That’s why I was jailed.

Do you agree with a statement that your imprisonment is the Kremlin’s revenge for your increasingly active political role, including your attempts to introduce your people into the parliament?

That’s part of it. Personally, I am in favor of a strong state, but I am convinced that the power of the state should be located not in the multitude and authority of its bureaucrats. Instead, it should be in the people’s trust toward the government, in the government’s ability of solving society’s problems by attracting and consolidating the nation’s best brains, in a system of institutional and social checks and balances.

I’ve supported various political parties and institutions because I am convinced that our country needs to allow for more than one point of view, it needs a strong and independent political opposition.

However, at this point I am sure that the main reason behind the Yukos affair was the desire of four or five people to gain control over a large and successful oil company. Politics was just an excuse to persuade the government to hit back with property redistribution by any means necessary, including those that are unlawful. In the previous decade we regularly witnessed similar attacks, but never directed against such a large corporation. Such high-ranking officials have never been instruments in these attacks before either.

What is your conclusion? Is this an example of your inflexibility and adherence to principles regarding the authorities, or is this a consequence of a series of mistakes in your business and public work?

Both. With fewer mistakes, more people would understand and trust me. But I still hope to gain their confidence. If it weren’t for my principles, I would be somewhere abroad or in the relevant bureaucrats’ offices, not in jail. I didn’t want to, and in any case I couldn’t. Perhaps before I may have, but at some point I started feeling more like a citizen than a businessman.

It’s harder to speak from a prison, but I am better heard this way. From abroad I would only be seen as an oligarch, squandering his wealth and casually discussing Russia’s destiny between the sauna and tennis sessions. It is physically more difficult for me to speak, but morally, I have a right to do so.

Two years ago you were saying that the State Duma needs to approve not only the appointment of the prime minister, but also his dismissal. Do you still believe that today?

It’s a much broader question. Our country needs a concept of a new political system. This concept still has to be developed. It seems to me that the president should position himself above all political battles as a guarantor of national stability. If the government, responsible for the country’s economy and administration, is formed by parliamentary majority, the duration of the presidential term would not be such an issue. The head of state would then play the role of political arbitrator and be responsible for appointing a number of judges, the prosecutor general, the heads of the special forces.

Many people today criticise the concentration of political power in the hands of one man. But we are forgetting that this concentration is a direct product of the 1993 Constitution, written under pressure of short-term political factors. And I hope we don’t change our political system again simply to conform to someone’s petty conjectural aspirations.

What is your opinion of the Kremlin’s new political reforms, such as the presidential appointment of governors and deputies only being elected according to party lists?

The intention of the authorities is to turn all politicians into appointees thereby freezing the ruling class, making it impenetrable for outsiders. This will invariably lead to stagnation. We already saw what happened to the ruling elite in a similar process during the 1980s, and today’s Russia is even more unstable than the USSR of that time. I think these reforms are dangerous. They may lead to a situation where the only way for people to complain is through revolt, a meaningless and merciless revolt. Would the authorities be able to suppress it? I am not sure.

Do you still think that big business has to repent for its mistakes in the eyes of the people?

Yes. This concerns not only big business, but the entire ruling corporation that is responsible for making the market reforms of the 1990’s completely antisocial, undermining people’s trust in liberal values and ideas. Yesterday’s and today’s bureaucracy, which are interrelated, whatever anyone says, should not assume that an apology from business frees it from responsibility for it’s mistakes.

Have you tried to reach an agreement with the authorities about the conditions of your freedom? Not through solicitation of your lawyers, but through talks with those controlling the investigation and the trial?

I have repeatedly and openly offered my shares of Yukos to the authorities. Not as a ransom for my freedom: I was hoping that by gaining my shares, those who are interested in Yukos would not destroy the company, leaving hundreds of thousands of Yukos employees jobless and hopeless. Yet these people’s fates have been sacrificed to someone’s selfish interests, oriented on Yuganskneftegaz. I mentally said goodbye to the company in spring 2004. That Yukos managers and employees continue to work defiantly marks them out not only as professionals, but as heroes. I feel sorry for the people who have been arrested and forced to make false statements, for the people who were forced to leave the country, and for the people who keep fighting despite everything.

What was the extent of your control over the company’s actions all this time? What are the prospects of the bankruptcy case started in Texas? Will the shareholders’ lawsuits affect the buyer of Yuganskneftegaz?

After my arrest I understood that the business would be taken away, but I could never even imagine that that would happen with the destruction of the company. Being in jail, it’s hard to interpret the situation adequately enough to continue managing it. As you know, I resigned as a Yukos board member. The company’s managers and the board of directors are responsible to the stockholders, so they are doing whatever is necessary to avoid any future complaints, especially from minority shareholders. The same goes for the directors of Menatep, where I held 9.5% and was beneficiary of 50%. Today this has also gone to other shareholders. Those that remain free may have changed something, but the directors are still independent, and are acting in the interest of all stockholders, according to the law.

As one of the Yukos shareholders, Menatep has repeatedly declared its intention to sue both the legal entities responsible for the so-called auction and the companies dealing with the ownership of Yuganskneftegaz. Personally, I am not planning to chase after any sums from the company or the state.

If you could address President Putin right now, what would you tell him?

Mister President, don’t let political power be devaluated and profaned. Don’t let it become a tool for property repartition in the interests of bureaucracy. This will only aggravate the problems of the 1990s.

What are your plans after liberation? Will you remain in Russia?

I don’t want to leave. I don’t see myself as a businessman anymore, I think that stage of my life has come to an end. However, I would like to continue with my educational and social projects through the “Open Russia” foundation, with my university project. I hope I can do this.

What do you do when not dealing with your lawyers and the court?

I read books, trying to stay in shape intellectually. I get many books, so I read a lot. I get stacks of newspapers, magazines, but sometimes I would rather not know or hear any news… I answer letters, people write me often, both from Russia and from abroad. There are almost no “bad” letters, everyone is empathetic, some people ask for help. I cannot exercise much; there is not enough room and only one hourly walk allowed daily.

Who are your neighbors in jail?

There are different people in jail, everyone has their problems, but so far I have found common language with everyone.

Are you satisfied with the conditions?

Well, it’s a closely confined cell, the conditions are tough. But there are pluses in a high security jail: the cell is 12 square meters, a few neighbors, a refrigerator, a television. The monthly meetings through a glass screen are especially hard. I miss my family — my wife, children, parents. I am very sorry for them. And I miss the sun.

Speech by Mikhail Khodorkovsky in Meshchansky Court (1.12.2005)

I rarely make statements during the proceedings because I find there is no sense in doing so. But sometimes it is impossible to keep silent. Before the New Year, Mrs. Vishnyakova, the official representative of the Office of the Prosecutor General, made a statement about imaginary billions of dollars stolen in the YUKOS case. I kept silent.

But today in Argumenty I Fakty newspaper, Mr. Biryukov, who is the Deputy Prosecutor General and who as I understand or I may be speaking incorrectly from the procedural point of view, is also the supervising prosecutor for our case, made the same mistake. In these proceedings we have repeatedly come across incorrect claims made by the Prosecutor General's Office. I would just like to draw attention to the statements made by Mr. Biryukov and other investigators in connection with Apatit shares about the stealing of 238 million dollars from the state. Even the prosecution has given up these charges by now (I refer to the charge of stealing from the state of this or a comparable amount in Apatit shares). At this time, I do not want to point out other incorrect claims made by the Office of the Prosecutor General and the [legal] violations that my lawyers have mentioned before. These include what we consider to be the illegal methods of working with witnesses - questionings immediately before court hearings, suggestive [leading] questionings held at the Office of the Prosecutor General, sometimes with questions that were not included in the record, and questionings after the investigation had been completed. If the prosecution needs to be reminded of the facts, we have them ready. But I think that all the participants in the proceedings remember them and I do not want to waste time on that.

During the preparation for these and other proceedings, which I believe are being prepared behind the court's back and which the representatives of the prosecution have mentioned, all the documents that were embarrassing to the prosecution were seized. At YUKOS alone, 150 searches were undertaken, and documents were seized from the lawyers' offices as well. Not all of the documents. The lawyers are surprised at the careless manner in making an inventory of the documents that were seized. There is nothing to be surprised at. In my opinion, the task was not only to find dirt, but also to block the defense's access to documents in order to work with witnesses without any restrictions. Business documents are stubborn things, and now many of them are missing. In some cases, they are unavailable to us, or they may not be included in the [document] inventories, or they are simply not admitted to the proceedings by the court at the prosecution's request. For example, documents on the transfer of promissory notes are included in the case, but documents on payment [of these] are in part not admitted to the proceedings, at the prosecution's request. It is funny that Lebedev was not even allowed to include his employment and tax record in the case materials.

I remain calm in the face of these and other peculiarities of the trial although in many countries they would constitute sufficient reason to stop these proceedings and initiate proceedings against the representatives of the prosecution who have permitted such violations. I stay calm because, frankly speaking, and I don't want to offend anyone, my trust in the Russian justice system has been undermined by the court decisions in the YUKOS case which easily found all the fantasies of the tax authorities and the prosecution to be lawful and justified. For instance, the YUKOS accounts were frozen because, I am quoting the ruling by memory, the chief accountant had stolen money from YUKOS and was keeping it on the accounts of YUKOS enterprises. This is not a joke; people were not paid their salaries for November on time because of that. Another example: according to the court ruling, for a period of four years, YUKOS evaded taxes amounting to a sum that exceeded its profit for those years. After such decisions, why should one pay any attention to trifling matters?

After all, our prosecution, which today is celebrating its 284th anniversary, has extensive experience. It was the prosecution, not the "cheka" or People's Commissariat of Internal Affairs in the late 1930's that led all the public and infamous proceedings. And later, in the 1960s and 1970s, there were generally acknowledged achievements as well.

Now we come to the main purpose of my speech today - [to talk] about the natural constraints that should exist, even in such fabricated proceedings, in light of the changes that have taken place in the world. In claiming that YUKOS, a consolidated company, had sold oil at understated prices and stolen billions of dollars, the prosecution is not only influencing the court in these proceedings, which is not so important, but is also harming itself and the country. YUKOS is the company that has consolidated accounts according to international standards, confirmed by international auditors and examined by analysts from dozens of countries. These accounts show all the income received, and not only income but also expenditures - for investment, acquisition of assets such as Sibneft, Arcticgaz, and Rospan shares. This means that the money was not only received by the company but was also spent by it. It is unlikely that the prosecution officials did not understand that. Unlike my colleague and partner Platon Lebedev, I consider the prosecution officials to be sane and professional. I even think that they have a conscience, but during proceedings like these, something happens to it [their conscience].

Do not simply take my word about oil prices. A mental calculation shows that the supervising prosecutor's remarks about profits of $49 being made by YUKOS for each ton of oil after selling it for 150 dollars sound illogical. Add the $22 charged by Transneft to the more than $50 in taxes and duties actually paid and it all adds up to more than $70. Plus, there were expenses for production and in addition the company's profits were not that low. All the accounts are available on the website. Only in Baikal Finance Group's accounts can billions of dollars appear from nowhere and go nowhere, and even that is unlikely. YUKOS departments stopped the stealing of much smaller sums than that.

I would like to give one more example. Everyone remembers the five billion dollars that the Office of the Prosecutor General allegedly discovered in my personal accounts in Switzerland. At that time I said here, in court, that that was not true. I do not have personal accounts abroad and I do not even have this kind of money. These were YUKOS shares at their market valuation in the accounts of the pension fund. Now even Mr. Biryukov does not completely deny this in his article. By the way, the amount remaining in the pension fund should be returned to the shareholders after fulfilling all obligations to retired employees after 2010. Again, this information is publicly available. The destruction of YUKOS played a mean trick, not only on the retired employees, but also on the Office of the Prosecutor General as well. Where are those 5 billion dollars now? In the same place where my infamous 15 billion dollars (according to Forbes) are to be found. They are buried under the wreckage of the company. Shares now stand at zero or close to zero.

I stopped worrying about my assets or even my future long ago. I think I will be found guilty of anything, as I said even of setting fire to Manezh. But seizing and placing the company's ordinary staff members in custody, including women with small children, is too much even for today's Russia. And inventing billions that do not exist is simply dangerous. Higher-ups may believe and demand that these billions ought to to be brought to the state coffers. But they simply do not exist. Because the shareholders' income from YUKOS consists of dividends, that income is derived publicly and legally. But what is worse is that they will have to deal with international auditors, international legal advisers of the company, and Western financiers of the company who cannot just keep silent in response to such accusations if they are made. And they will have to resolve these problems, not in the Basmanny Court, but in an impartial court, and in different countries. And then again some people will feel sad for their country, and some people will be sorry for specific individuals.

If anything that I have said today from the factual point of view raises question on the part of the court or the prosecution, I am prepared to provide a detailed accounting any day with references to documents and names. But that is not my aim. I do not want the prosecution to paint itself into a corner with its noisome accusations and arrests and in consequence destroy many people's lives in pursuit of a specter. I congratulate many of the conscientious prosecution officials on their official holiday, and believe that the current problems [faced by] the Office of the Prosecutor General will surely be overcome after a truly independent justice system is established in the country. It will be painful, but everyone will win from it - the courts, the prosecutors, and society. I believe that the most important thing for everyone is not what they will gain but their own dignity. That is all [I have to say].