Putin Urges ‘Business Freedom’ amid Michael Calvey Detention

Only days after the arrest of prominent U.S. investor Michael Calvey in Moscow, Russian President Vladimir Putin called for fewer criminal proceedings against businesses on Wednesday, The Financial Times reported.

“In order to achieve the great tasks our country faces, we need to get rid of everything that limits business freedom,” Putin said in his annual state of the nation address.

He said “honest businesses” should not “constantly feel the risk of criminal or administrative punishment.” A business can fall apart due to probes “launched for unclear reasons,” causing 130 people on average to lose their jobs, Putin said.

Last week, Russia arrested prominent U.S. and French investors on suspicion of fraud. The arrest of the American head of a major investment firm Michael Calvey sent shockwaves through Western business circles. Calvey, the founder of the Baring Vostok private equity firm, has been placed in pre-trial detention in a Moscow jail along with several other suspects.

They are accused of defrauding Vostochny Bank of at least 2.5bn rubles ($37.7m). Calvey has denied wrongdoing and blames the case on a shareholder dispute. His arrest took place on the same day Russia hosted leading business people in the Black Sea resort of Sochi for a major economic forum which trumpeted the country’s openness to investment.

Business leaders said they fear the case will deal a severe blow to an investment climate already marred by corruption and the lack of independent courts. It is the latest in a long line of cases in which top business people have been accused of crimes motivated by commercial or political interests, but these have rarely involved foreigners.