Russian oil giant YUKOS says that it is unable to meet a midnight deadline to pay a $3.4 billion back-tax bill

Russian oil giant YUKOS says that it is unable to meet a midnight deadline to pay a $3.4 billion back-tax bill and says bailiffs could begin taking control of its assets within hours. A YUKOS official made the admission on Wednesday hours before the deadline at the close of a day dominated by reports the company was in last-minute talks to stave off bankruptcy. Its detained chief shareholder, billionaire Mikhail Khodorkovsky, was said by his lawyer to be ready to give up control of the firm. "We are not in a position to pay and we have not paid," the official told Reuters. "This means bailiffs could start writing off funds from our accounts from Thursday and begin evaluating our assets to offer them at tenders or in direct purchase deals." The affair is widely seen as being driven by President Vladimir Putin in a resolve to end Khodorkovsky's political ambitions and demonstrate to other wealthy businessmen that they should not work against the Kremlin. Khodorkovsky's trial on fraud and tax evasion resumes next Monday. He has been in jail since last October. Putin has pledged not to destroy YUKOS but gave no comment on Wednesday, appearing at a news conference with Bulgaria's president but leaving before anyone could ask about the affair.