Human rights and the case of Sergei Magnitsky

Rt Hon Denis MacShane MP
Magnitsky Speech

Adjournment Debate
“Human rights and the case of Sergei Magnitsky”

Westminster hall
UK Parliament

11 January 2011

Mr Chairman,

I want to deal today with the tragedy of a lawyer working closely with and for a British company and its British chairman who was done to death in the most atrocious circumstances. Had a British lawyers working for an overseas firm been arrested and so mistreated in prison as corrupt functionaries and those with a financial interest in his disappearance had so suffered all hell would let lose.

Human rights and the case of Sergei Magnitsky

But this tragedy happened in today’s Russia and my charge today is that the British government has been singularly lax and lacking in dealing with the case and taking adequate and necessary measures not just to obtain justice but to send a clear message that putting to death a lawyer representing Britain is not cost-free.

I am not claiming a new policy of ‘Advocatus britannicus sum’ but the very idea of civilisation and rule of law as well as the clear rules of the European Convention on Human Rights to which Russia is a signatory provide a special place for lawyers to represent their clients without facing prosecution, or persecution unto death.

The details of the tragic death of Sergei Magnitsky are well known. Mr Magnitsky was the Moscow lawyer of a British businessman, William Browder. He was born American and was the grandson of Earl Browder, the leader of the Communist Party of the United States in the 1930s until he fell out with Stalin in 1945.

His grandson decided capitalism was a better bet than communism and built up the largest investment fund in Russia with billions of dollars of assets. Not all went well for young Browder, and when he started publicly complaining about the endemic corruption in Russian state companies, President Putin expelled him from Russia as a “threat to national security”. I recommend to the House the remarkable documentary by ms Norma Percy on the early Putin years which will be shown on BBC2 next Thursday. It shows the interface between politics, the state bureaucracy on business. Once the Putin regime decides it does not like a business leader it doesn’t operate in half measures. When they decide to turn on you, they do so in a spectacular fashion. After Browder’s expulsion, Putin’s tax police, raided his offices in Moscow, seized all his company stamps and seals and then stole his investment holding companies.

Browder hired a bright young Russian lawyer named Sergei Magnitsky to try to stop this on-going state sanctioned crime. Magnitsky investigated all the police actions and discovered that Browder’s companies were not only stolen, and but then subsequently used by the tax police to fraudulently refund, from the government’s coffers, $230 million of taxes that Browder’s firm had paid in the previous year.

Magnitsky did what any lawyer does in behalf of his client. He filed criminal complaints and testified about the involvement of the tax police in this enormous crime.

This was a big mistake. He was subsequently arrested by the same tax police officers he testified against and blamed for the fraud himself. The scams the ‘Putinocracy’ arrange are not just for a few high-ups. Everyone gets a cut. So to shut up Magnitsky he was flung into one of the roughest prisons in Russia and essentially held as a hostage. Because the Russian state could not get at Browder, safe in London, they went for his lawyer to send a signal to other firms operating in Russia that when the tax police or anyone else demanding a cut knocked at the door cooperation was wiser than insisting on rule of law.

Magnitsky was brutally treated in prison. He was tortured for 358 days with sleep deprivation, freezing temperatures, withholding of food, and other torments left-over from the Stalin era of torturing people the Kremlin did not like. After six months of this, he got extremely sick and was systematically denied any medical treatment. Eventually Magnitsky’s beleaguered body began to give way, and he went into critical condition. Instead of sending him to the emergency room, his jailers put him in an isolation cell and allowed eight riot guards with rubber batons to beat Sergei until he was dead. He was found lying in a pool of his own urine dead on the cell floor at the age of 37.

Since then, the Russian government has tried to cover up the cause of death. A network of named officials in the tax, police, public prosecution and prison departments of the Russian state has now been identified. Many have property abroad bought at prices impossible on their declared salaries.

None of the above facts are a secret. They have been reported as have the details and names I will not mention by Moscow journalists. They have been debated by US Senators and Congressmen and Women, by Parliamentarians in EU member states and in the European Parliament itself and have been a subject of a Council of Europe report.

I and a number of Rt Hon and Hon Members as well as Peers have asked questions in Parliament and sought to highlight this assault on a respected British business and the terrible insight the Magnitsky death gives us into how Russia operates. Another young lawyer is Vasily Aleksanyan, former General Counsel of Yukos General Counsel. In 2006 Aleksanyan was arrested as part of the persecution of those involved in Yukos; however he rapidly developed serious health conditions due to AIDS-related illnesses, but was denied antiretroviral treatment or chemotherapy in jail. In 2008 the European Court of Human Rights intervened, ordering Russian authorities to release Aleksanyan, however the damage done to his body during his detention was too great and he died in 2011 as a direct result of the denial of treatment in jail.

This is the Magnitsky story. Now we have to turn to the Whitehall story as ask the Minister why the Foreign Office and Home Office have been so lax in taking up the Magnitsky case and so unwilling to take action against the named officials who were involved in the theft via the tax system of the money that Magnitsky sought to reveal.

Can the minister explain why some of the principals have been allowed to enter the UK without let or hindrance. There is the Russian Interior Ministry Lieutenant Colonel Artem Kuznetsov was named in Magnitsky’s testimony as having orchestrated the theft of Hermitage Fund’s investment companies. Kuznetsov was also accused of perpetrating the $230 million tax fraud as well as Magnitsky’s false arrest and persecution in detention. Public records show that shortly after the $230 million was paid from the Russian treasury, Kuznetsov’s family acquired $3 million in high-end apartments in Moscow, land plots outside the city and several luxury cars. He travelled to the UK twice in 2006.

Interior Ministry Major Pavel Karpov was named by Magnitsky as a close accomplice of Kuznetsov. Karpov initiated the criminal case against Mr Magnitsky which was used as a pretext for his false arrest. Public records in Russia show that Karpov’s family acquired $1.3 million in real estate assets and luxury cars following the completion of the fraud. Karpov travelled to the UK 4 times between 2006 and 2007.

Dmitry Klyuev, is the owner of Universal Savings Bank. This was the bank through which the $230 million proceeds of the fraud were laundered. Klyuev was previously involved in a number of other tax refund frauds. Also, in 2006, Klyuev was convicted of a $1.6 billion fraud relating to an attempted theft of shares of Mikhailovsky GOK, a Russian iron ore company. He travelled to the United Kingdom at least 5 times in 2008.

Along with the following Government officials who all played a role in the tax fraud Magnitsky uncovered, his subsequent arrest and imprisonment, persecution of Hermitage lawyers and executives, Magnitsky’s continued detention, denial of medical care, torture, denial of fair hearings and finally his death in custody and the subsequent cover up of his murder:

From the courts service: Judge Yelena Stashina, Judge Aleksey Krivoruchko, Olga Egorova
From the Interior Ministry: Oleg Silchenko, Oleg Urzhumtsev, Alexei Anichin, Oleg Logunov, Boris Kibis, General Major Tatiana Gerasimova
From the FSB (secret service): Viktor Voronin
From the tax offices: Olga Stepanova, Yelena Khimina
From the prison services: Dmitri Komnov, Fikhet Tagiev, Yuri Kalinin
From the General Prosecutors office: Andrey Pechegin

I would ask the Minister to agree that these people should now be banned from entering the UK and their names circulated via Interpol and Europol.

We need to sharpen up our diplomatic tools by declaring that the functionaries linked to Magnitsky’s death are unwelcome as visitors in Britain as the US State Department has done under pressure from Congress.

The FCO will resist this idea and have constantly sought to downplay the Magnitsky affair.

The FCO position has been to shelter behind the Russian bureaucracy. On 15 November 2011, the Minister for Immigration finally replied to a letter I sent him in August on the idea of visa ban.

He wrote that, “The Russian Presidential Council on Human Rights presented to President Medvedev its report on Mr Magnitsky’s arrest and treatment” and that the “Minister of the Interior has announced that its own internal investigation has not found any evidence of abuses by their officials”. Well, that’s a surprise – but nevertheless, “the Investigative Committee of the Russian Federation chaired by Alexander Bastrykin” would report by 24 November.

To my knowledge no such report was issued and it is time for the FCO and Home to stop parroting Russian excuses for inaction and instead follow the example of the United States and make clear that those who stole the money Magnitsky was investigating and then colluded in his death should not be given a permanent status of impunity by Whitehall fiat.

In an earlier reply to a Parliamentary Question from me on July 13 last year, the Minister for Immigration confirmed and I quote that:

“The Secretary of State for the Home Department, does have the power to exclude foreign nationals whose presence in the UK she judges would not be conducive to the public good” but he added that “the duty of confidentiality means that the Government are unable to discuss the details of individual immigration cases.”

I am sorry, but this will not do and is not true. HMG has regularly published the name of those it denies visa entry to. Some of them include the TV cook Martha Stewart, the actor George Raft, the Scientologist L Ron Hubbard and even the Nobel laureate, the Chilean poet Pablo Neruda who wrote, “Death is the stone into which our oblivion hardens”.

It is the wish of the Russian authorities that Magnitsky’s death hardens into oblivion but as another great writer who lived under communism Milan Kundera wrote: “The struggle of man against power is the struggle of memory against forgetting.”

We are not ready to let Magnitsky be forgotten and if the Home Office can publicly ban a cook, an actor, a loopy and a poet then surely it can ban those Russian officials named as associated in the massive theft, and then arrest and ill-treatment to the point of death of a lawyer representing a British citizen and his company.

Modern Russian apparatchiks like to visit, buy flats, or educate their children in England. By naming, shaming and announcing they will lose those privileges if they break the law and allow a lawyer representing a British firm to die in agony for having defended his client’s interests diplomatic pressured will be focused, sharp and will send a clear state-to-state signal that Russia cannot live above the law.

It is not just about Russia. We need to find ways of sending signals to mid-level officials that when they break the law the idea that the doors of Britain are not open to them. This does require a new approach to create a new tool of democratic diplomacy namely the precisely targeted travel ban which is made public so that all the law-abiding state officials in Russia and elsewhere can see that corruption and collusion in murder are no longer crimes without sanction.

That is also what more and more decent Russian citizens want. A further signal could be sent. Just as Mr Putin is not welcome on the streets of Moscow Britain should say he is not welcome at the opening ceremonies of the London Olympics.

In the 20 years since the end of communism Russia sent the first decade being plundered by oligarchs and the last decade being robbed by state functionaries up to the highest level. It is time that Russia became a normal rule of law nation and its tax collectors levy taxes for the good of the people not their own off-shore bank accounts.