Swiss Extradite Ex-Sovkomflot Manager

Switzerland on Monday extradited a former manager of state-owned shipping giant Sovkomflot, who is wanted on charges of embezzling millions of dollars in fraudulent tanker deals.

Yury Privalov, a former managing director of Sovkomflot's London subsidiary Fiona Maritime Agencies, was flown to Moscow under the escort of Federal Prison Service officers, the Prosecutor General's Office said in a statement.

Privalov is believed to have committed crimes during his tenure from 2001 to 2004 that caused damages worth $250 million, the statement said.

In return for his extradition, Russia has issued detailed assurances that it would provide him with humane prison conditions, including access for Swiss officials, the Swiss Federal Office of Justice said.

Privalov says he is being prosecuted for political reasons, and a Swiss court ruled in December that he could not be extradited without a guarantee that his rights would be protected.

Privalov is among a group of former managers accused of participating in a massive fraudulent tanker-leasing scheme. Sovkomflot said earlier that the scheme caused the company up to $600 million in damages.

As head of Fiona, Privalov was responsible for buying and selling freighters for Sovkomflot's fleet, which at the time comprised 47 vessels.

The company is suing the managers, including former CEO Dmitry Skarga and businessman Yury Nikitin, in the London High Court. Last year, Sovkomflot managed to freeze almost $450 million in assets owned by the suspects, but the trial is not due to start before the fall of 2009.

The Investigative Committee at the Prosecutor General's Office, which is handling the case, said in February that it was has been seeking to extradite Nikitin and Skarga, who both live in Britain, over the purported embezzlement of more than $700 million.

It was unclear Monday what effect Privalov's extradition might have, if any, on the chances that Nikitin and Skarga might be extradited as well.

Privalov tried to fight his extradition through the European Court of Human Rights in Strasbourg. The court initially asked Swiss authorities to withhold the extradition, but recently waived its request, said Folco Galli, a spokesman for the Swiss Federal Office of Justice.

"But the case in Strasbourg is still pending," Galli said by telephone from Bern.

The spokesman dismissed questions over whether Russia would live up to its guarantees. "Russia has always given guarantees and held them," he said. "What is special now is that they were formulated more precisely," he added.

Privalov's lawyer in Zurich did not return calls for comment Monday.