By Steve Gutterman
MOSCOW, Dec 24 (Reuters) - Russian prosecutors on Monday dropped their accusations against the only person being tried in connection with the prison death of anti-corruption lawyer Sergei Magnitsky, asking a court to find a former prison official not guilty.
The surprise move in the trial of Dmitry Kratov came in the midst of a row between Moscow and Washington over U.S. legislation meant to punish Russians seen as linked to the death of Magnitsky and other alleged human rights violations.
If the court clears Kratov, a former deputy head of a jail where Magnitsky spent part of a year, it will fuel accusations by Kremlin critics that the Russian government has no intention of seeking justice in a case that has blackened Russia's image.
"We have not determined what happened, and the biggest tragedy here is that ... this may have been our last chance to ask questions" of people who may have been involved, said Dmitry Kharitonov, a lawyer for Magnitsky's widow and family.
U.S. President Barack Obama on Dec. 14 signed a law known as the Magnitsky Act, which directs his administration to bar accused Russian human rights violators from entering the United States and freeze any assets they have in U.S. banks.
Russia is retaliating with a bill expected to be approved by the upper house of parliament this week. It would apply similar measures to Americans accused of violating the rights of Russians and also bar Americans from adopting Russian children.
Magnitsky died in November 2009 after nearly a year in jail - the victim, former colleagues say, of retribution from the same police investigators he had accused of stealing $230 million from the state through fraudulent tax refunds.
His death caused an international outcry and Kremlin critics said it underscored the dangers risks run by Russians who challenge the authorities. The Kremlin's own human rights council said Magnitsky was probably beaten to death.
Dmitry Medvedev, Russia's president at the time, fired several senior prison officials and ordered a investigation, but Kratov, charged with negligence, is the only person now on trial or facing trial in connection with his death.
State prosecutor Konstantin Bokov told the court there was no direct link between the actions of Kratov - who he said followed the rules of his job and had never received a health complaint from Magnitsky - and the lawyer's death.
The court is expected to rule on Friday on Kratov's guilt or innocence.
Kharitonov said a guilty verdict was still possible but unlikely, and he accused the prosecutors of avoiding testimony by several witnesses by saying last week that there was enough evidence for a guilty verdict and speeding the trial to an end.
"The prosecutors essentially defended Kratov, rather than prosecuting him," he said in an interview on cable TV and internet channel Dozhd.
He said he believed Russian prosecutors want Kratov cleared to avoid any suggestion they themselves are culpable in the death of Magnitsky, which occurred after prosecutors backed efforts to keep him in jail on tax evasion charges.
Kharitonov said the prosecutors also wanted to ensure they were on the right side in the conflict over the new U.S. law.
"The easiest thing for the prosecutor's office to do is to say that nobody is guilty - and if nobody is guilty, then why is the Magnitsky Act needed?" the lawyer said.
He said Magnitsky's family would demand that the state continue investigating his death.
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