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. Last Updated: 07/27/2016

Senior Yevroset Executives Quizzed

Itar-TassA box of Motorola phones confiscated from Yevroset. The searches relate to a contraband case that began in 2005.
Senior executives at Yevroset, the country's largest cell phone retailer, were questioned Thursday by prosecutors investigating contraband handsets following a search of their homes.

Yevroset vice president for security Boris Levin said he was questioned by the Prosecutor General's Office at 3 p.m. Thursday along with the company's vice president for finance, Alexander Papin.

Levin's home, along with the homes of two other executives and Yevroset co-owners, were searched Wednesday, he said.

The homes of company president Alexei Chuikin, co-owners Timur Artemyev and Yevgeny Chichvarkin and vice president for finance Alexander Papin were all searched, Vedomosti reported Thursday, citing a source inside the Prosecutor General's Office.

The searches relate to a case of contraband handsets that began in 2005, Levin said Thursday. At the time, the Interior Ministry impounded about 200,000 handsets at Sheremetyevo Airport.

Last year, charges were filed against Alexei Shirokov, executive director of Yevroset OPT, the company's purchasing arm, in connection with the investigation, Vedomosti reported. Shirokov was questioned Wednesday by the Prosecutor General's Office, the newspaper said, citing unidentified sources.

"The company is not guilty,'' Levin said. He declined to say why the searches took place but that Yevroset had prepared a file with one week of the company's e-mail for prosecutors.

Levin was not available for further comment Thursday evening.

Yevroset co-owner and chairman Chichvarkin refused to comment on the events Thursday.

Searches were also conducted at the offices and homes of managers at telecom retailers Dixis, Tsifrograd and Betalink, a source in the Prosecutor General's Office told the newspaper on Thursday.

Among the locations searched were the homes of Dixis co-owner Andrei Shlykov, Tsifrograd co-owner Valerian Revin, along with warehouses and offices owned by the companies, Vedomosti said.

Spokespeople at the Prosecutor General's Office refused to confirm the details of any raids or the reports of managers being questioned Thursday, saying only that checks were being conducted at Yevroset.

Shlykov could not be reached for comment Thursday.

Spokespeople at Tsifrograd and Betalink also could not be reached for comment Thursday.

Vitaly Kupeyev, a telecoms analyst at Alfa Bank, downplayed the potential repercussions from the latest events.

"I think it is intended more as a move to frighten them than to have a serious effect on the market," Kupeyev said. The companies were being checked because of long-standing rumors about custom duties being circumvented, he said.

"They will probably just have to pay a fine in the end," Kupeyev said.

In the worst-case scenario, the current moves by prosecutors could cause cell phone prices to rise, Kupeyev said. It could also tarnish Yevroset's reputation ahead of a rumored initial public offering, he said.

Wednesday's raids were approved personally by Deputy Prosecutor General Alexander Bastrykin, Vedomosti said. Bastrykin, a former classmate of President Vladimir Putin, is set to head a new investigative committee in the Prosecutor General's Office, which will begin work in September.

(MT, Bloomberg)