MOSCOW, August 23 (RAPSI) - The embezzlement case against Vladimir Khokhlov, the head of a Skolkovo Foundation subsidiary, has been withdrawn, and charges against former senior manager Kirill Lugovtsev have been commuted, a Skolkovo spokesperson told RIA Novosti.

An investigation was earlier launched against Khokhlov, who heads TFK Skolkovo, and Lugovtsev in connection with their alleged role in the embezzlement of 24 million rubles (about $723,092) from the federal budget.

All charges against Khokhlov were dropped on July 19. He was reinstated in his former office later on the same day.

Lugovtsev is now accused of abuse of power. Before that he was charged with misappropriation, the foundation representative said.

Lugovtsev was suspected of renting a building to house the TFK Skolkovo headquarters from a company owned by his parents.

TFK Skolkovo was established in 2011 with the purpose of providing to customs representative's services to participants of the Skolkovo project.

Investigators also suspected that TFK Skolkovo, which employed a dozen of people with a monthly salary ranging between 300,000 and 600,000 rubles ($10,000-$20,000), has completed only one customs procedure during its two-year existence.

The Skolkovo Foundation, set up in 2010 by then President Dmitry Medevedev, is the primary agency for the Skolkovo high-tech development hub, which includes a business center, a science and technology institute and a management school. The project is intended to showcase the drive to diversify and modernize the Russian economy. Renova Group president Viktor Vekselberg is one of the foundation's prime investors.