Russia theater director Kirill Serebrennikov, charged with fraud, looks out from a defendant cage during a hearing Wednesday in Moscow. (Vasily Maximov/AFP/Getty Images)

A Moscow court on Wednesday placed one of the country’s premier avant-garde theater directors under house arrest in a controversial embezzlement case that has prompted outrage among leading Russian singers, actors and other cultural figures, including some favored by the Kremlin.

Kirill Serebrennikov, the virtuoso director who rebuilt Russia’s Gogol Theater into a theatrical powerhouse as the Gogol Center, will be held for two months under house arrest as he awaits trial for allegedly participating in a 68-million-ruble, or $1.1 million, fraud scheme tied to a production company he ran called Seventh Studio. Investigators claim he and several other employees connected to the company colluded to steal money from state grants, a crime with a maximum sentence of 10 years in prison.  

Serebrennikov, who has been critical of the government but is hardly a protest leader, has produced a number of controversial projects, including a retelling of the life of dancer Rudolf Nureyev with frank portrayals of his gay relationships. The ballet was pulled by the Bolshoi Theatre just three days before its scheduled premiere in July. 

In court Wednesday, Serebrennikov pleaded with a judge to allow him to remain free to continue working at the Gogol Center and to complete a film retrospective of the life of ­perestroika-era Russian rock icon Viktor Tsoi.

“I would like to be released because I am not guilty,” Serebrennikov said in court, calling the accusations against him “absurd and impossible.” “I am the artistic director of this project. My job was to make the project into a bright and powerful work of modern art, a bright and visible moment in Russia and abroad. That’s what happened.”

Police first raided Serebrennikov’s house and the Gogol Center in May but released him after protests and after Russian President Vladi­mir Putin reportedly called the investigators “idiots” upon hearing about the raids. Serebrennikov’s passports were seized, but some friends had urged him to apply for new documents and go abroad. He declined.

“I have nothing besides Russia, besides my work in Russian culture,” Serebrennikov reportedly told the court Wednesday.

The case highlights the ­double-edged nature of government funding in Russia, which sustains large theaters, operas and ballets throughout the country. But that also makes those institutions vulnerable to pressure from the government, and Serebrennikov’s projects have been the target of criticism by the Orthodox Church and Culture Minister Vladimir Medinsky, a former lawmaker who has called on Russian cultural institutions to stage works that exclusively celebrate Russia’s heritage. 

“I am certain that this isn’t a frame-up,” Medinsky, a member of Putin’s cabinet, told the Russian state news agency RIA Novosti on Wednesday. “I have a source.” He did not say who that source was. 

Oxxxymiron, a popular Russian rapper, spoke out in support of Serebrennikov on Wednesday. “It’s messed up,” he said, according to the Meduza news agency. “We [rappers and others] don’t depend on government money, so we don’t have these kinds of problems. But classical culture often operates at a loss — it can’t survive without subsidies.”

Thirty-four prominent Russian cultural figures vouched for Serebrennikov in a list. Among them were Vladimir Urin, the Bolshoi Theatre’s director, installed by Putin in 2013; state-television host Andrey Malakhov; film director Fyodor Bondarchuk; and the flamboyant pop singer Philipp Kirkorov, who celebrated his 50th birthday this year with a concert at the State Kremlin Palace. 

Serebrennikov is believed to have allies in the government, including Vladislav Surkov, a deputy prime minister of Russia sometimes called the Kremlin’s “gray cardinal” for his role in curating Russia’s internal politics. In 2011, Serebrennikov staged a novel called “Almost Zero” allegedly written by Surkov under a pen name. But his arrest Tuesday and subsequent arraignment were a sign that such support has limits.

Outside the courthouse, a crowd of hundreds of actors, writers and other supporters gathered during Serebrennikov’s arraignment, occasionally chanting “Freedom!” at grim-faced riot police. Their rounds of applause were audible from inside the courtroom. Actors from the Gogol Center, where Serebrennikov has been artistic director since 2012, declined to speak on the record but said that the mood at the theater was “stunned” and “gloomy.”

Yuri Kolokolnikov, a former colleague of Serebrennikov’s who has known him for 15 years, said he did not understand the arrest.

“Kirill was never a person who sought conflict,” Kolokolnikov said. “But he always spoke his mind and didn’t shy away from that. Why shouldn’t he have? He’s a free person, and we live in a free country and should be able to say what we want.”