PHNOM PENH, Cambodia -- His grandmother's bones went missing two years ago, not long after the rains stopped. "The grave is all rubber trees" now, said Sev Thveal, 23. Part of the Jarai minority, he can barely read and write and has worked the land so long that his toenails are a permanent shade of brown.

He and 11 villagers are alleging in court that a wealthy businesswoman named Keat Kolney, whose husband and brother are senior figures in the Cambodian government, has illegally taken land belonging to 70 rural families to make way for a rubber plantation.

Keat Kolney declined to comment, hanging up when reached by telephone. But she denies the claims of wrongdoing, said her lawyer, Chhe Vibol, and is responding with legal action of her own.

The dispute is unfolding as Cambodia struggles to emerge from three decades of genocide and civil war. Now, the Southeast Asian country is trying to move beyond its thuggish past and build a society founded on the rule of law rather than networks of patronage.

Cambodia joined the World Trade Organization in 2004, and the government, which recently got its first sovereign debt ratings from Standard & Poor's and Moody's, plans to open domestic stock and bond markets as early as 2009. Government leaders cite these moves as proof of major progress, but human rights workers and many ordinary Cambodians say little has changed.

"A wealthy and powerful social class has emerged on the back of the state -- through the exploitation of the people and the country's resources," Yash Ghai, the U.N. secretary general's special representative for human rights in Cambodia, said in prepared remarks to the United Nations' Human Rights Council in Geneva.

Global Witness, a British advocacy group that served as Cambodia's forest monitor until it was expelled from the country in 2005, made similar charges in a recent report, saying a "kleptocratic elite" has been stripping Cambodia of its natural resources.

"In Cambodia's civil war, the warring factions used the country's natural resources as a means of generating income to fuel their military spending," Eleanor Nichol, a Global Witness campaigner, wrote in an e-mail from Washington. "Since then, Cambodia's political elite have found it hard to kick the habit of using the country's natural resources as their own personal cash cow."

Accusations from Global Witness enraged Cambodian officials, who denied wrongdoing and dismissed the report as politically motivated. The government banned the report's domestic dissemination -- an ineffective gesture as the document is freely available online -- and promised to launch its own investigation.

Despite booming economic growth, Cambodia is still heavily dependent on donor aid. When donors sat down in Phnom Penh on June 19 and 20 and committed to deliver $689 million, the Cambodian delegation included two men who Sev Thveal contends have the power to put his dead grandmother to rest.

They were Keat Kolney's older brother, Keat Chhon, who is the country's finance minister; and her husband, Chhan Saphan, one of the most powerful officials in the Ministry of Land Management.

Chhan Saphan declined an interview request, and Keat Chhon didn't respond to requests for comment.

Sev Thveal and his fellow villagers say that in 2004, Keat Kolney bribed numerous local officials with cash to help trick and bully the villagers into signing away close to 1,100 acres of their most fertile farmland.

Villagers contend that local officials threw a party for them, serving beer, traditional rice wine and pork. When villagers became drunk, officials took their thumbprints. Some of Keat Kolney's cash went to the villagers, the lawsuit contends, but they say they didn't realize what they were being paid for.

The plaintiffs say they thought they were signing over only about 125 acres to disabled soldiers from a group affiliated with Cambodia's prime minister, Hun Sen. But soon bulldozers arrived and cut through about 665 acres of cashew trees, rice paddies and vegetable gardens to make way for a vast rubber plantation. Villagers say they've lost 60 percent of their arable land and have not seen a single disabled soldier.

Now they want their land back. Chhe Vibol, the lawyer, says it's too late. "Rubber trees have already been planted on more than 200 hectares," or about 500 acres, he said. "Giving all the land back is impossible."

On June 21, Keat Kolney filed criminal lawsuits against the villagers and their lawyers, according to Chhe Vibol. She has also lodged a formal complaint with the Cambodian bar association, contending that lawyers working for two legal aid groups advising the plaintiffs have fallen under the sway of foreigners.

"We purchased the land legally," Chhe Vibol said.

Last month, villagers traveled from Ratanakiri, a remote province in northeastern Cambodia, to the capital Phnom Penh, where they visited the Ministry of Economy and Finance and made daily pilgrimages to the Ministry of Land Management, hoping to secure audiences with Keat Kolney's powerful relations and persuade them to intercede.

They had no luck. Now they're back home in Ratanakiri, hoping the imperfect wheels of Cambodian justice will turn in their favor. Ith Mathoura, one of their lawyers, says that's unlikely. Cambodia's notoriously corrupt judiciary, she says, almost always serves the rich and powerful at the expense of the poor.

"The land problem is everywhere in Cambodia," said Brian Rohan, an American attorney working as a legal adviser at the Community Legal Education Center, which is helping represent the villagers. "There is a lot of land-grabbing because the value of land is going up, stability has returned, and there is a lot of economic activity."

The case, he added, is "a powerful symbol for whether the Cambodian government is committed to implementing any of the policies it professes to support during its conversations with donors."

Government spokesman Khieu Kanharith declined to comment on the litigation between Keat Kolney and the villagers but warned against jumping to conclusions. "A few trees do not constitute a forest. What is most important is the political will of the government to establish the rule of law," he said.

He points to Cambodia's WTO entry, an arduous process that has required writing or rewriting many laws, as evidence of that commitment. "Our main concern is to make our law reach international standards. Sure, from paper to practice, there will be a gap, but at least the government is laying the ground for the rule of law," he said.

Now many are asking: How far has Cambodia actually come?

"There is clearly a grievous problem in this country with illegal logging and land-grabbing," U.S. Ambassador Joseph Mussomeli said in an interview. "No one with any credibility can deny that. The prime minister has admitted as much himself."

But Mussomeli added that he was not aware of evidence that would substantiate all the allegations Global Witness made against high-ranking officials.

"We believe there are those high in the government who are concerned about this and working hard to counter illegal logging," Mussomeli said. "It's not a totalitarian regime."

Meanwhile, villager Sev Thveal has a more immediate problem: his dead grandmother.

His family hasn't been able to appease her spirit with a proper buffalo sacrifice, he said. Because his farm got bulldozed, he has had to start buying rice to eat and doesn't have any extra money.

"I used to visit the burial ground of my grandmother every day of every month of every year," Sev Thveal said. "Now her spirit maybe just goes everywhere. She's homeless."