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Magnitsky Associate Portrayed as Valiant James Bond Hero

An interview with much candid insight into the mind of William Browder, the banker/investor and associate of the late Sergei Magnitsky

RI's Czech Watch would be incomplete without an article from the “dissident gloss” Respekt magazine, so we've decided to dig up an old classic, “Browder’s War” (29. 4. 2014).

“When beetles fight these battles in a bottle with their paddles and the bottle's on a poodle and the poodle's eating noodles...

<figcaption>William Browder</figcaption>
William Browder

...they call this a muddle puddle tweetle poodle beetle noodle bottle paddle battle”.

— Dr. Seuss, Fox in Socks

These words kept creeping into my mind while reading (and translating) this interview. William Browder, the intrepid avenger of Sergei Magnitsky, describes his plight with the ebb and flow of a slapstick adventure movie wrapped up in an over-the-top, vendetta-driven psychodrama. A beetle-battling communist, turned capitalist, now reborn human rights defender a la James Bond. All in one very fluffed piece. (Alas without a busty Bond babe.

"I decided that for my life to have some meaning, I have to dedicate it to punish those who wronged Sergei." — William Browder

This article originally appeared at Respekt Magazine (Ondřej Kundra). Translated for RI by Anthony Grulich

Just a few years ago, William Browder would have claimed that the main thing was to do business and not be preoccupied with the state (condition) of the world. But then something happened, that forced the American-British billionaire to change his opinion. He became a participant (actor) in one of the most dramatic political thrillers of today. Money has vanished from his accounts and a victim of murder became his closest associate. Browder experienced a revelation - and under the constant protection of bodyguards commenced a life and death battle from his London headquarters.

"Please, wait here by the lift, I'll call the assistant upstairs and she will receive you. They don't want anyone to go up without their knowledge“, says the receptionist on the ground floor of one of the historic buildings on Golden Square in London's Soho. After a while we receive permission to press a button and ride two floors up. We are received by an elegant assistant right at the door and taken to an elongated meeting room with a view of the center of the British metropolis’.

William Browder (49) arrives after a few minutes. At first glance, no one would recognize that this bespectacled man with graying hair is one of the richest Brits of today. The visage of the cautious banker also obscures the fact that standing in front of us is a person regarded by many people today as the biggest and most dangerous opponent of the Russian ruler Vladimir Putin. In fact just recently, Browder himself solely using his energy and focused efforts, managed to compel the American Congress to adopt unprecedented legislation, which prohibits several tens of high-ranking Russians from entering American territory and freezes their foreign assets. Standing against these people isn’t without its risks - they are powerful and will want revenge.

The same feelings on the other hand motivate Browder as well: he promised himself to avenge the death of his friend and associate Sergei Magnitsky, a lawyer who died in a Russian jail in 2009. He ended up there, when searching for the perpetrators that stole Browder’s property and the American-British billionaire is convinced that both the murder and loot – lye on the conscience of people from Putin's immediate surroundings. That is why he wants to get them to stand trial in a Russian court and make it impossible for them to enter a majority of western countries.

An Angry 007

Even though today, Browder’s people do both adventurous and dangerous work just as if it were cut out of a James Bond mission, it is not noticeable at first glance. "This is my team", Browder points to a group of some twenty men and women in his office that one could easily confuse with your regular London brokers from the nearby City. Just as there, even here there are variously spaced out desks occupied by thirty somethings in elegant and decent colored suits and skirts, pensively studying the data on the displays of their notebooks and calling somewhere every other moment. Under the peel of a routine office though, lurks hot action.

On the days when we visited Browder’s office, It turned out that his people were verifying fresh information from one of his sources, that the two men suspected of being involved in the murder of the lawyer Magnitsky have supposedly started doing business in Prague, where they had transferred a part of their - allegedly derived from illegal activities - assets. The persons in question are Artiom Kuznetsov and Mikhail Dragunov, representatives of the Interior Ministry who, according to Browder were involved in procuring falsified evidence of criminal activities, which led to the imprisonment and subsequent death of thirty five year old Magnitsky.

Today, Browder’s people have very accurate details about the people involved in the events surrounding the death of the young lawyer and have that (info) crammed into their computers. Regular biographic data on age, place of birth, residence, wives and children to their interests and weaknesses and tracks of all their assets. Browder’s team has the same information available on Kuznetsov and Dragunov, which is now being referenced with available data about men with identical names, who founded a company in Prague some time ago.

A few days of work later it turns out that this time it is an apparent dead lead but Browder’s people are used to that by now – they’ve gotten themselves into blind alleys many times, without it diminishing their resolve in any way. Similar determination was always typical of Browder according to his friends even during his youth, while growing up in Chicago in the seventies in the family of his grandfather Earl, the longtime leader of the American Communist Party, who twice ran unsuccessfully for the office of president of the USA.

While friends were rebelling against their parents wearing long hair in protest and identifying with the hippie lifestyle, Browder set out in the opposite direction. "I knew what would anger my family circle the most. That was to become a capitalist. So I became one“, says the banker. "He is one of the most determined people I have ever met. A very upset and confident, wealthy man, who will not stop until he has accomplished what he resolved (to do). To get the people surrounding president Putin involved in Magnitsky’s murder“, says of Browder former Moscow editor for The Economist weekly Edward Lucas, who has been following the financer’s efforts to punish the death of Magnitsky for years.

Browder’s commitment is also a very risky (game of) roulette. From the moment he set off on his war path he has been receiving telephone death threats frequently (for example, excerpts from the well known film the Godfather "that if history taught us something, it’s that anyone can die") and that is why several armed men protect him day and night. Even face to face with mortal danger, Browder will not be discouraged.

A knife Through the Throat

Browder’s schedule is just as busy as before and he works with the same intensity – goes to work at seven in the morning and leaves at eight in the evening - earlier meetings with financiers and bankers were now filled by meetings with politicians, lawyers or activists of various non-government and human rights organizations. The financier is focused exclusively on punishing the death of Magnitsky and it occupies his entire program.

"It was on a weekend at seven in the morning, when the telephone rang near my bed. I will never forget that moment. It was one of my associates from Russia and he told me that Sergei was dead. I experienced such intense physical pain, as if someone had stabbed me through the throat with a knife“, says Browder at his desk. "I wandered around the apartment for an hour and didn't know what to do", he recalls. The usually decisive and aggressive businessman called his colleagues in a panic asking for their advice but even they were paralyzed by the news. "That he would die was something completely unexpected, something I never imagined even in my worst dream“, says Browder.

A few hours after getting over the greatest despair, Browder dialed the number of Magnitsky’s mother and then his wife and promised them that he would obtain justice for their son. "I decided that for my life to have some meaning, I had to dedicate it to punish those who wronged Sergei," he says.

Call Medvedev

Browder definitely noted that something suspicious was happening with his life in Russia by November 2005. By that time, he had already been doing business in Moscow more than ten years and his financial group Hermitage Capital (bought up and appreciated shares of Russian enterprises selling valuable raw materials, such as crude oil) was the fastest growing foreign investor in the country. The financier had just returned from a trip to London lasting several days to see his family, when he was approached by two police officers in the VIP lounge of Moscow Sheremetevo airport, had his passport confiscated without any explanation and led away to a detention room, where suspicious passengers are held.

Without food or drink, Browder spent the next fifteen hours there, sitting on a chair only to have the police place him on a plane back to England again without a word of explanation. " I had repeatedly criticized various local officials in Russia for misappropriation and wasting public finances before, so of course it was going through my head that it could be related. I didn't know for sure though. What was absolutely clear to me, however, was that I have a big problem“, says Browder.

Upon returning to London the financier started to look into what had happened, and tried to regain permission to enter Russia and continue working at his functioning business. Letters sent to officials at the Russian Interior and Foreign Affairs Ministries were never replied to. The ice thawed a bit, after he coincidently met with Dmitry Medvedev at a diplomatic reception in London, a candidate for president at that time and he retold him his story.

Medvedev promised that he would try to help him in front of witnesses. And indeed, shortly after he was called upon to request a visa from Moscow. However, after doing so, a few weeks later he was informed by a representative of the Russian Interior Ministry Artiom Kuznetsov that his application had been rejected because he presented a "national security threat" to the Russian federation. Browder, as he says, understood that it was over and began taking steps to discreetly transfer Hermitage from Moscow to England as soon as possible. But this didn’t work out.

Tatarstan Heroes

To this day it isn’t clear and not even Browder knows, whether the financiers ban on entering Russia was planned from the beginning in advance, where further dramatic events were then (played out) in logical sequence. Or, whether someone just simply took advantage of Browder’s momentary weakness and disfavor with the powerful. In any case, two months after his final visa rejection (VIS) stormed the offices of Hermitage Capital on a court ordered search warrant with twenty five officers of the Interior Ministry led by colonel Kuznetsov, incidentally the same man who had previously signed the letter rejecting Browder’s visa application.

The reason was the tax authorities’ suspicion that an Hermitage subsidiary company had not paid taxes from dividends in full. Even though the court order pertained to that company only, Kuznecov’s people confiscated documents, (rubber) stamps and computers from another three companies within the entire Hermitage group. Browder is convinced that it was part of a deliberate plan to get lucrative businesses out of his portfolio and to steal from the Russian state at the same time - which then actually occurred. The details of the action were planned by five people according to him with Kuznetsov in the lead and his friend, the boss of Russian USB Bank Dmitri Kljujev, during a secret meeting in Cyprus. They were also protected by some members of the Russian government.

The reality is that the stamps confiscated at Hermitage were later used without Browder’s consent to (authorize) the transfer of e several Hermitage subsidiaries to the ownership of some company called Pluton, hastily registered in thousand kilometer distant autonomous republic of Tatarstan in the name of a former employees of one local saw mill serving a criminal sentence for manslaughter at the time. The remaining two "new bosses" were also ex-convicts. They or a third party - subsequently falsified accounting documents stolen from a Hermitage subsidiary from 2006, reporting the company making a loss that allowed them to demand a retroactive payment of 230 million dollars from the state, which were originally transferred by Browder as a tax (payment).

Browder was receiving messages about developments from his associates of course and complained to authorities by correspondence (remotely). Two complaints, that his companies were stolen and transferred without his consent were sent to the top Russian public prosecutor and two more to the Interior Ministry. There they were rejected with the argument that the transfer was valid because of the stamps and signatures, the transaction is legal. Browder then addressed a further two complaints to the tax authorities to return 230 million (dollars) in paid taxes by Hermitage companies because it was a fraud on the Russian state and its citizens. The response of officials was to the contrary that the money would be paid out because the new owners had requested it and all valid documentation was submitted, the authority could not block it. With that, the entire case was closed: Browder lost his three lucrative businesses worth hundreds of millions of dollars and later, the Russian state budget lost more than two hundred million dollars.

In the meantime, the investigation into Browder’s alleged fraud was in full swing and led by colonel Kuznecov. The man, who had confiscated the later, misused the stamps and documents, would end up accusing Browder of large-scale tax fraud. To most everyone’s surprise though, he did not press any charges against the American-British financier - instead he pressed “criminal conspiracy“charges against several of Browder’s lawyers from Hermitage and banned them from representing the subsidiaries that already had new owners in Tatarstan.

This move by Kuznetsov prompted the new owners to apply for the aforementioned tax return and was paid out despite Browder’s objections. This was decided by another participant of the aforementioned meeting in Cyprus, the head of the competent Moscow tax authority Olga Stepanova. She later sent the funds to a new account for Hermitage branches at USB bank, an institution belonging to the organizer of the Cyprus negotiations, the Klujev bankers.

The Death

Kuznetsov’s charges of "criminal conspiracy" mainly affected the man, who led the search for those, who stole Browder’s companies in his absence from the very beginning - of Sergei Magnitsky. This young lawyer, after several weeks of work in the field discovered that the whole operation was overseen by top Interior Ministry representative Kuznetsov, he even uncovered the man from Tatarstan, to whom the branches of Hermitage were illegally transferred and also revealed a fraud on the Russian state, the request to refund taxes already paid. He wrote this all up in a detailed report, with which he turned to the highest authority in Russia, the Russian federation Investigative Committee.

In his report, Magnitsky also pointed out that all of Browder’s previous complaints on illegal procedure in the theft of his companies that they always ended in the circle of friends of colonel Kuznetsov and therefore could never be independently investigated. Before Magnitsky received any official reply from the Investigative Committee however, he was arrested. By the same colonel Kuznetsov, whose illegal conduct he had warned about. Kuznetsov’s people detained Magnitsky at home before the eyes of his wife and children and took him into custody. Eight days before the expiration of the maximum one-year time limit on detention Magnitsky died there. The official cause of his death was "a ruptured diaphragm".

According to Russian human rights organizations documentation, Magnitsky was held in an unheated cell with an open window most of the time where lights were on all the time, During his imprisonment he submitted four hundred and fifty complaints in total, concerning conditions and treatment, the inability to have contact with his family and phone his children. He was examined by doctors because he suffered from constant pain, vomiting, and fevers and was diagnosed with a gall bladder inflammation with ultrasound and prescribed surgery immediately. The police, however, had Magnitsky transferred to the infamous Butyrek Russian prison, which had no medical equipment allowing treatment.

Magnitsky health has getting dramatically worse and the prisoner repeatedly pleaded for surgery immediately unsuccessfully. The doctor prescribed pain medication, but when they weren’t effective and Magnitsky complained again the doctor at Butyrek put him in a straight jacket. And sent him to the psychiatric (ward) As Russian human rights organizations documented, Magnitsky was subsequently taken from the infirmary by eight Special Forces guards, they put him in hand cuffs, beat him with batons and left him in solitary confinement next to a bed. An hour and a half later he was found dead by a doctor and a nurse checking on him in his cell.

The Russian authorities subsequently investigated the circumstances surrounding the death of Magnitsky, which triggered a storm in the media and the Russian opposition, the case fizzled out though. Respectively, it ended with the dismissal of several prison employees on grounds of neglected medical care.

Experts like the quoted Edward Lucas have a tendency to claim that in the case of Magnitsky we can well discern a manifestation of soviet methods of governing, where law and business revolves around the interests of narrow groups of people who combine the practices of a firm hand with intelligence services technology and big business and organized crime. According to Lucas as he describes in his book Deception: Spies and lies or how Russia dupes the west, it is precisely this community that has taken control of government administration and is using it illegally for their own interests and enrichment.

William Browder sits behind a desk in his office; a photograph of Magnitsky’s coffin hangs on the wall behind him with his bowing mother holding a red bouquet over him. "His death totally turned the foundations of my life upside down", says the financier. "I've changed; money is secondary for me today. I feel responsible for what happened to Sergei“. This revelation of financier Browder, the onetime uncritical supporter of president Putin’s steps, who benefited for years from the non-transparent business environment he created, started him on a mission, which resulted with the mentioned ground breaking legislation enacted by the U.S. Congress.

We could just wave this off because it can't be difficult for the American-British billionaire to assert his influence. Nevertheless the fact is that almost no individual in the world before him had been able to affect such a significant dent into American politics, not even similarly influential people like Browder. The financier’s story mainly shows that a real driver of great events can be the energy and the strength of personal conviction. Browder may have lobbied tens of politicians and their assistants but the turning point wasn’t until his speech in front of an important American congressional committee. The subject of the meeting: Russia.

"Several guests spoke before me and everyone described horrible things. That twenty reporters were killed in Russia that given year and x number of persons kidnapped and so on. I always spoke of (people as) a group and not a particular person“, recalls Browder. "And then I just told them that I am going to speak about Sergei, a man I knew well and for whose death I feel responsibility. I told them what he did for me and how he was criminalized because of that and later tortured as well. And that he died for the sole reason that justice meant more to him than anything. The more I spoke and looked politicians in the eyes, the more I gained their attention. They stopped texting and reading in their notebooks and when I finished, utter silence set in“.

Then - Browder further recalls – American political veteran and presidential candidate from the late sixties George McGovern spoke and said that "he had heard a lot of things in his long political career but that this really impressed him". Later, he asked how he could help Browder. "I said I have been trying for some time to push through legislation at the US State Department prohibiting Magnitsky’s murderers from entering American territory, so far without success. The congressman replied that if the State Department isn’t interested, then they would do it in Congress. And that the act would be named after Sergei Magnitsky – The Magnitsky Act“.

Congressman McGovern really did help push the legislation through Congress before his death with the support of other politicians and the Americans have just published the first eighteen names of Russians, who according to him are banned from entry into the US. Among them are prosecutor Kuznetsov, administration official Stepanova, who allowed the return of taxes paid to the state treasury to the "owners" from Tatarstan, several judges involved in the case and Interior Ministry officials and officers of the Interior (Ministry). "It does not end with this victory", says Browder.

A Little Closer One Day

It is the third Tuesday in April (2014), nine o'clock in the evening in the gallery for guests in the British Parliament. One of Browder’s closest current associates Mark Sabah takes his seat and is visibly nervous. "I was already here once a few hours ago but they were quarrelling over Baroness Thatcher’s legacy, so further items on the program were postponed, says Sabah. His eyes meanwhile don’t stray from conservative Member of Parliament Robert Buckland, who is about to speak (interpolate) on the point that Sabah has been anxiously awaiting.

"Great Britain considers Russia a friend and because friends tell each other the unpleasant things as well, one such thing cannot go without mention," parliamentarian Buckland proclaimed in the quiet hall. ”That, what happened to Sergei Magnitsky is a turning point. I ask the government to follow the example of the USA and adopt legislation, that people involved in his death will not be permitted to enter British territory“. Sabah didn’t hide his enthusiasm. "Excellent," as he appraised the parliamentarian’s speech with a hushed cry from the gallery.

His euphoria was then cooled by the speech of the Minister for Europe David Lidington, who said that the Cabinet continues to favor individual conversations on the given subject with Russian partners rather than the law."They are afraid of business relationships", Sabah commented on the minister’s speech. In the subsequent debate parliamentarians are divided (on the issue) into roughly two equally strong camps regardless of party affiliation.

One camp demanded adherence to) the law, the other supported the minister’s non-conflictive approach. The parliamentarians suspended the debate after an hour of deliberations deciding to continue at a future date. "It won’t happen quickly but I believe, that gradually other colleagues will join and the government will therefore approve the legislation in time, I hope", Buckland optimistically commented on the positive development of events. "We believe in it, "Mark Sabah nods."But it will be quite a slog."

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