Vostok faces police probe over EBRD loan

A British gas and oil group has been investigated over allegations of bribery and corruption involving a loan from the European Bank for Reconstruction and Development.

Vostok Energy said it had co-operated with a probe by City of London police over a $200,000 payment that the company alleged in fundraising documents was made by a third party to Elena Kotova, once Russia's top representative to the EBRD.

Earlier this month, Russia's interior ministry charged Ms Kotova with bribery, accusing her of soliciting more than $1.4m while serving on the board of the multilateral lender. She denies the allegations.

Vostok has operations in the Saratov region of southwestern Russia and has been targeting a flotation. It is chaired by Charles Jamieson, a gas and oil industry veteran who is also chairman of Salamander Energy, a FTSE 250 group.

In the fundraising documents, it said the alleged payment to Ms Kotova was made in connection with its successful application for a $60m EBRD loan in 2009 but did not involve company money.

It added that its current board had not known about the payment prior to the police investigation.

A lawyer for Ms Kotova denied that she had received a bribe in connection with Vostok's application, saying she had had "good relations" with its shareholders but would not have controlled whether the request was approved in any case.

The lawyer added that Ms Kotova had been travelling on the day Vostok's application was considered and had not taken part in the board vote.

Vostok said the Crown Prosecution Service had informed it in November that there was insufficient evidence for it to be charged, adding that the EBRD had said this month that it was no longer investigating the group.

However, Vostok alleged that its former chief executive, Alexander Capelson, still appeared to be a suspect in the police investigation.

Mr Capelson declined to comment. Vostok said the former chief executive left the group in 2011 by mutual agreement in connection with the investigation.

Vostok also said it had been co-operating with a probe into a consultancy it used to aid its EBRD loan application. However, it said was told by City of London police in June 2011 that it would not face further action on that matter as things stood.

City of London police confirmed its overseas anti-corruption unit was investigating allegations of money-laundering and bribery concerning transactions with the EBRD.

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Two people have been charged with corruption and money-laundering and are due to stand trial at the Old Bailey on April 8. Mr Capelson, a co-founder of Vostok, is not among those charged.

City of London police added: "On separate matters, two others - a man, aged 51 and a woman, 27 - remain on bail, with further suspects remaining outstanding abroad, and enquiries continue on a third linked investigation."

The EBRD declined to comment, as did Mr Jamieson, who is also a co-founder of Vostok.

Additional reporting by Sally Gainsbury and Jane Croft

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