Cambodia bows to Russia, kicks out tycoon wanted for fraud

May 18, 2015 09:15
Sergei Polonsky is accused of embezzling US$115 million from down payments made by prospective buyers of a luxury residential complex in Moscow that was never built. He denies the accusations. Photo: WSJ

Cambodia has booted out a former Russian billionaire amid increased pressure from Russia to extradite him to face fraud charges.

Sergei Polonsky, once one of Russia's wealthiest men, was deported on Sunday for alleged immigration violations.

Police had arrested him on Dam Luong Island late Friday afternoon, the Wall Street Journal reported.

Uk Heisela, a director at the country’s immigration department, said Polonsky left the country about 7.20 a.m. Sunday on an itinerary that was scheduled to take him to Moscow via Vietnam.

Russian prosecutors asked Cambodia to repatriate the 42-year-old former billionaire in 2013 to stand trial on embezzlement charges but Polonsky, who denies the charges, had contested extradition proceedings.

Russian prosecutors accuse Polonsky of embezzling 5.7 billion rubles (US$115 million) from down payments made by prospective buyers of a luxury residential complex in Moscow that was never built.

Moscow filed the charges in absentia in 2013 and declared him a fugitive.

Last year, Cambodia’s Supreme Court ruled Polonsky could not be repatriated to Russia because there was no extradition agreement between the two countries.

Recently, however, Cambodia’s Ministry of Foreign Affairs asked the Ministry of Justice to review Moscow’s request to extradite Polonsky and officials from the two countries have discussed implementing an extradition treaty.

A spokesman at the Ministry of Foreign Affairs said Polonsky’s arrest was not related to the extradition deliberations but was the result of the businessman allegedly breaking immigration rules by staying in Cambodia after his visa expired.

That view was supported by immigration director Uk Heisela.

“We’re following our immigration law,” he said

The businessman’s lawyer, Benson Samay, denied Polonsky had overstayed his visa. He declined to comment further.

Polonsky is chairman and founder of real-estate group Potok, a successor company to the defunct Mirax.

It operates in Russia, Ukraine, France, Cambodia, Switzerland, the US and the U.K., according to its website.

Its Cambodian assets include a resort on Dek Koule island, off the coast of Sihanoukville.

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