Police on Tuesday detained the head of the company that leased the Bulgaria riverboat for a weekend cruise on the Volga River, where more than 120 people drowned when it sank.
But the ship's Canadian-based owner said it could only assume "moral responsibility" for the worst disaster in Russian waters in post-Soviet history.
Officials avoided commenting on persistent reports that the 55-year-old ship was literally falling apart.
Meanwhile, divers worked at the riverbed where the Bulgaria is resting, bringing bodies to the surface. Among them was the captain, Alexander Ostrovsky, who refused to leave the ship and worked until the last minute to save passengers, Itar-Tass reported.
Sixty-six bodies had been retrieved by late Tuesday, the Emergency Situations Ministry said. Forty-four of them had been identified.
Estimates of how many people were on board varied from 205 to 209 on Tuesday. Seventy-nine of them survived the disaster, which saw the ship flooded by waves and sink in just three minutes during a storm Sunday.
The ship sunk at lunchtime, and most of the dead were trapped in its restaurant. Thirty to 50 children crowded into the playroom, also inside the ship, shortly before the disaster, and died as well.
Two cranes will lift the Bulgaria to the surface by the end of the week, Alexander Davydenko, head of the Federal Sea and River Transportation Agency, told reporters. Emergency officials said earlier that some bodies could only be recovered by raising the ship.
The federal government will pay 1 million rubles ($35,000) in compensation to families of those who died on the Bulgaria, and 200,000 to 400,000 rubles to those injured in the accident, depending on the gravity of their injuries, Prime Minister Vladimir Putin said Tuesday. The administration of Tatarstan, where the accident took place, will add another 300,000 rubles to the families of the dead and up to 100,000 rubles to the injured, Interfax said.
The Investigative Committee said in a statement that it has opened a case into the ship's operator, Argorechtur, which it said has no license to transport passengers. The company's head, Svetlana Inyakina, was arrested and may face charges of providing unsafe services that resulted in deaths. If convicted, she faces up to 10 years in prison.
Also detained was Yakov Ivashov, a senior inspector with the Kama branch of the Russian River Register, a federal agency that handles the licensing of riverboats. Ivashov faces the same charges as Inyakina for authorizing the Bulgaria's operations a mere three weeks before the tragedy, Rossia One television said.
The Bulgaria appears to have been flooded through open portholes by an incoming wave, but analysts and bloggers suggested that poor maintenance also contributed to its sinking.
River ships undergo checks before each voyage, as well as thorough inspections by the Russian River Register every two years. But inspection rules explicitly allow inspectors to authorize the operation of ships that do not fit formal safety guidelines if shipowners can provide data proving the vessel is nevertheless safe.
Moreover, a thriving institution of middlemen offer to handle the checks on behalf of the shipowners every two years — a corruption-prone practice that has analogies in other Russian industries, including construction.
Officials with the Russian River Register were unavailable for comment Tuesday, as were those at its supervising agency, the Transportation Ministry.
Reports about the Bulgaria's dismal state were confirmed by Roman Kalmykov, head of the Tatarstan-based ship company Farvater. He told Komsomolskaya Pravda in an interview published Tuesday that his company considered leasing the ship but ultimately backed away after realizing that it would cost 7 million rubles ($247,000) to repair it.
Investigators on Tuesday searched the office of Bulgaria's owner, Kamskoye Rechnoye Parokhodstvo, but did not detain or charge anyone, news reports said. The majority stake in Kamskoye Rechnoye Parokhodstvo belongs to Canadian-based Antonov Canada Corp., controlled by Perm businessman Mikhail Antonov.
Antonov, 46, a card-carrying member of United Russia, was unavailable for comment, but Kamskoye Rechnoye Parokhodstvo general director Valery Kirchanov denied blog reports that his boss had fled abroad.
"It's a lie. He never was there, and he's not there now," Kirchanov said, according to Interfax. He did not specify where Antonov was but said there was no need for him to flee because the company had simply leased out the Bulgaria without a crew, which he said cleared Kamskoye Rechnoye Parokhodstvo of responsibility.
"We are only morally, not legally, responsible for the deaths of the passengers," Kirchanov said.
Another investigation was opened into the captains of two barges that were reported to have passed by the Bulgaria's survivors without rescuing them, Investigative Committee spokesman Vladimir Markin said.
But the cases may prove unfounded because the captain of a ship that did stop to pick up the survivors said he had asked a barge not to intervene.
"I understood that my ship would do it faster than the barge," captain Roman Lizalin told Rossia-24 television. His cruise ship, the Arabella, picked up 77 survivors. The remaining two survivors apparently swam to shore.
Lizalin, 30, told Channel One television that his men had struggled to tell people from the debris floating on the stormy water but added that "his crew acted as one team."
President Dmitry Medvedev has ordered sweeping checks into passenger transportation nationwide following the tragedy. But it remained unclear whether the checks would benefit the ship industry, which one expert said has been in "complete chaos" since the Soviet collapse.
"Ports are in one set of hands, ships in another, and the prices for boat trips are skyrocketing," said Mikhail Kobranov, editor of the Rechnoi Transport (River Transport) industry magazine.
Most Russian river ships are operating past their expected life spans and "ought to have been scrapped long ago," he said by telephone.
The checks will likely result in bans on old ships, not a broad reform that would revamp the industry, said Andrei Novgorodsky, head of the National Shipowners Association.
"It is easier for bureaucrats on the ground to take prohibitive measures than to set transparent rules of the game," Novgorodsky said by telephone.