Court Upholds Arrest of State Factory Director

YEREVAN (RFE/RL)–A Yerevan court has allowed the arrest of the chief manager of one of Armenia’s biggest state enterprises pending a trial on embezzlement and mismanagement charges.

The lawyer of Gagik Nersisian–the executive director of the Nairit chemical factory–said on Saturday that the district court has turned his client’s four-day detention into arrest.

Nersisian was taken into custody on Tuesday and initially charged with "abuse of power." He was taken to a city hospital with serious health problems shortly afterwards and is still kept there. Nersisian’s lawyer–Hovannes Galian–told RFE/RL that police changed the accusations to a "particularly large-scale waste of public funds" before petitioning the court. A person found guilty of that offense can be sentenced to six to twelve years in prison–according to the Armenian criminal code.

Galian dismissed the accusations as "groundless" and said he will appeal the arrest injunction at a higher court.

The law-enforcement officials allege that the embezzlement resulted from highly unfavorable barter operations the arrested director engaged in with other companies. They say the price of Nairit’s production was miscalculated when it was exchanged with other goods. Newspaper reports spoke of $4 million as the alleged damage to the state caused by the Nairit management.

Once the flagship of Armenia’s chemical industry–Nairit has struggled to remain afloat ever since the break-up of the Soviet Union. The factory has run up a huge debt to the state budget and the energy sector.

Galian argued that Armenian law allows buyers and sellers to agree on any price they deem necessary and Nersisian should not be prosecuted for making economic decisions. Deals concluded by Nersisian were needed to pay workers and keep the chemical giant working–the lawyer said.

Nersisian is a senior member of the Democratic Fatherland Party–a small opposition group. The party has so far refrained from labeling his arrest as politically motivated.

It is unclear how long the embattled director will stay in hospital. His health condition worsened on Friday–according to Galian.

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