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. Last Updated: 07/27/2016

American Arrested on Fraud Charges

For MTMaxim Dlugy
A former U.S. chess champion has been arrested at Sheremetyevo Airport and charged with attempting to defraud a Perm metals plant of $9 million.

Maxim Dlugy, 38, was detained on April 12 and transferred to Perm, where he is being held in custody.

Perm prosecutors said Dlugy is suspected of illegally signing off on $9 million in promissory notes at the Solikamsk Magnesium Works, where he served as chairman from June to August 2003.

But a former colleague, Igor Ivanov, said Dlugy was being used by the plant's current management, who he said did not want to pay off the plant's old debts.

Dlugi represented a Virgin Islands-registered investment company called the Russian Growth Fund, which owned 50.42 percent of the plant's shares, said Ivanov, a legal aide to the fund's head, Mark Lisnyansky. Chess champion-turned-opposition politician Garry Kasparov once served as a senior adviser at the Russian Growth Fund.

Metals company Silvinit bought the plant from the Russia Growth Fund in late 2003. Silvinit could not be reached for comment Tuesday.

An official in the Perm region prosecutor's office said the promissory notes ended up with three companies that were registered with stolen passports or passports belonging to dead people.

The companies demanded that the plant make good on the notes and then went to court when it refused, the official said, speaking on condition of anonymity. An investigation was opened into Dlugy in May 2004, the official said. When he did not show up for an interview with investigators in Solikamsk, he was put on a national wanted list, the official said.

Ivanov, however, said Dlugi had been living in Moscow for the past six months and had traveled abroad almost every week without any problems.

Dlugy emigrated from Russia to the United States in the early 1980s, where he received U.S. citizenship, said Denis Bilunov, an aide to Kasparov.

Dlugy was ranked No. 1 in the World Blitz Chess Association from 1988 to 1993. In 1985, he became world junior chess champion, and in 1990-1993 he was president of the 70,000-member U.S. Chess Federation.

Solikamsk Magnesium Works is Russia's second-largest magnesium-producing plant. Ivanov said its yearly turnover is about $100 million and the United States buys 60 percent of its production.