Russian businessman’s 20-year bid to enter Canada spawned top secret spy agency probes, but never citizenship

National Post

One evening last fall in the Parliament Hill office of a Canadian senator, a group of influential Canadians met with a controversial Russian oligarch bearing an intriguing offer: to help reveal the fate of Raoul Wallenberg, the Swedish diplomat hailed as a hero for saving tens of thousands of Jews during the Holocaust, before he disappeared in Soviet custody.

Two bodyguards stood outside Conservative Senator Linda Frum’s office watching over Vitaly Malkin, founder of a private national bank, once listed as one of the world’s wealthiest people and a member of the Russian senate.

Inside, Mr. Malkin and Ms. Frum were joined by Liberal MP and former justice minister Irwin Cotler, who brought with him Mr. Wallenberg’s niece, Louise von Dardel. Charles Wagner, Mr. Malkin’s Toronto lawyer, and Moshe Ronen, vice-president of the World Jewish Congress, were also there, all of them looking to Mr. Malkin to pry the Wallenberg secret from KGB archives.

Despite a whiff of Hollywood thriller about the after-hours gathering, it likely seemed entirely normal to Mr. Malkin, whose life is writ against a backdrop of international intrigue, precipitous geopolitics, high-level access and massive financial deals.

For 20 years, Mr. Malkin has eyed Canada, applying to live here and seek citizenship, investing millions in Toronto real estate.

Immigration rejection, RCMP probes, secret notations about him with Canada’s spy agency, accusations of organized crime ties, court battles with the government and lawsuits with former business partners have been his reward.

His November visit can be seen as something of a triumph, as it meant overcoming a 19-year ban on entering Canada for alleged involvement in organized crime, an accusation he steadfastly fought as unfair and baseless. Mr. Malkin, never charged with a crime, says he is a victim of Western prejudice against Russia’s business elites, with an assumption that their wealth comes from mobsters or corruption.

However, Mr. Malkin also found that not everything about his past was forgotten when he again crossed the Canadian border.

This summer he raised international ire when he led a delegation to Washington to defend Moscow against accusations of human-rights abuses in the 2009 death of Russian accountant Sergei Magnitsky, which has become a global cause célèbre and a source of significant diplomatic friction between the U.S. and the Kremlin.

It all left Mr. Cotler and Ms. Frum telling the National Post they regret the meeting with Mr. Malkin, with Mr. Cotler now wondering if, by offering help on the Wallenberg mystery, Mr. Malkin: “felt this was a way to perhaps sanitize his reputation.”

For 20 years, Mr. Malkin has eyed Canada, applying to live here and seek citizenship, investing millions in Toronto real estate.
On Nov. 21, 2012, Mr. Cotler was hosting Ms. von Dardel, Mr. Wallenberg’s niece, during her visit to Ottawa. They shared a stage that evening with Jason Kenney, the immigration minister, at the opening of a Wallenberg exhibit at the Canadian War Museum. Wallenberg — who issued bogus Swedish passports to protect an estimated 100,000 Jews in Hungary from Nazi death camps — was arrested in 1945 by the invading Red Army and disappeared. He is presumed to have died in Soviet custody; how, when and why remains a mystery, but his legacy is celebrated as much in Canada as anywhere: He was named Canada’s first honorary citizen in 1985 and, in January, Canada Post issued a commemorative stamp in his honour.

“I don’t really know very much about him,” Ms. Frum said, when asked about the meeting with Mr. Malkin. “I simply took at face value that he was a member of the Russian legislature and therefore potentially somebody of influence and potentially somebody who could help solve this important Jewish mystery, this moral mystery that is of great emotional significance.”

Added Mr. Cotler: “[Mr. Malkin] said that sometimes people go through official channels and don’t get anywhere but he had — quote — ‘informal’ channels that he could go through and that he believed that he could, in fact, get us some information with respect to Wallenberg.”

For his part, Mr. Malkin declined to divulge details about the meeting. “I did indeed have a discussion about Raoul Wallenberg — but the sensitive nature of the case precludes me from offering any additional details,” Mr. Malkin said in an e-mail interview.

It wasn’t until afterwards that Mr. Cotler and Ms. Frum learned more about the friendly Russian senator, they both said.

Mr. Cotler said it became clear that “I didn’t want to have anything further to do with him.” Ms. Frum said it was “wrong to seek help down this avenue.” Mr. Ronen said he is just looking to solve the Wallenberg mystery and has no involvement in political concerns. Mr. Wagner declined to discuss it. Later, Ms. Frum added: “If Russia were an exemplary democracy, these files would have been opened long ago. But those of us who want truth in the Wallenberg matter must deal with Russia as it is, not as we would like it to be.”

There certainly are problems in Russia, with evidence of egregious corruption and rights abuses, and Mr. Malkin did not endear himself to human-rights champions, of which Mr. Cotler is a notable one, when he led a delegation from Moscow to Washington in July to lobby against the Magnitsky Act, a U.S. law imposing financial and visa restrictions on corrupt Russian officials. The law is named in honour of Sergei Magnitsky, a lawyer who was arrested, tortured and died in a Russian jail after he made corruption allegations against Russian authorities. The Russian government has been so determined to go after Mr. Magnitsky that, next week, prosecutors will begin trying him posthumously — an exercise that has been compared to the show trials held under the Stalin regime.

In Washington, Mr. Malkin suggested Mr. Magnitsky was a drunk who died from pancreatitis, not abuse, and was legitimately arrested on tax evasion charges.

“[Mr. Malkin] came to America on a mission to defame Sergei Magnitsky,” said Bill Browder, the U.S. investor in Russia who Mr. Magnitsky was representing when he was arrested. (Mr. Browder also faces charges in Russia after he was ejected from the country. He said the charges are an attempt to cover-up a theft by officials, who are accused of stealing as much as $230-million.)

“He lied in Washington to members of the U.S. Congress and slandered Sergei Magnitsky posthumously to protect people involved in covering up a major fraud perpetrated against the Russian people,” Mr. Browder said.

Mr. Malkin said his message in Washington was misunderstood. He was proposing a joint U.S.-Russian investigation into Mr. Magnitsky’s death and the allegations against him, he said.

“There is a lack of confidence in America with the Russian justice system and, in my view, nothing less than an independent joint investigation would suffice,” said Mr. Malkin.

Mr. Malkin’s campaigning on the Magnitsky file causes particular embarrassment for Mr. Cotler, who is championing a bill in Canada to impose the same type of Magnitsky Act sanctions here.

And yet, the fact Mr. Malkin took the lead on the sensitive and prominent Magnitsky case may provide some sense of the trust and influence he maintains in Moscow; the sort of influence that might shake loose the Wallenberg secret.

He was granted 10 visitor’s visas; one of two former spouses moved to Canada and, along with one of Mr. Malkin’s three sons, gained Canadian citizenship.
Vitaly Borisovich Malkin was born in 1952, the son of Ukrainian Jews in Pervouralsk, a Russian industrial city near the boundaries of Europe and Asia.

As a PhD student, he became close with Bidzina Ivanishvili, currently the prime minister of Georgia, the former Soviet republic, and one of the world’s richest men. The two became swashbuckling entrepreneurs and, as the Soviet Union dissolved, they founded the Rossiyskiy Kredit Bank, one of Russia’s first private banks. Mr. Malkin said its success was “meteoric.”

As the Russian economy was privatized in the 1990s, vast wealth accumulated quickly as some stock values jumped 200 to 400 times, Mr. Malkin told visa officials.

“I believe that most Westerners do not understand all this and, as a result, they are ignorant and suspicious about [the] origins and current sources of Russian money.”

Mr. Malkin was a major shareholder in a number of Russian companies, including his wife’s cigar store in Moscow that had the exclusive right to sell Cuban cigars in the city, he said. He owned real estate in Moscow and Tel Aviv, had an investment in the Bahamas, and a metal-trading company in Geneva.

Mr. Malkin also amassed political capital. He drew close with Boris Yeltsin, Russia’s first post-Soviet president, becoming one of his closest business allies. Showing his resilience in Kremlin politics, he is one of the few to remain prominent under the current presidency of Vladimir Putin. Along the way, Canada captured his attention.

He was granted 10 visitor’s visas; one of two former spouses moved to Canada and, along with one of Mr. Malkin’s three sons, gained Canadian citizenship.

In 1994, Mr. Malkin applied to move here permanently, with his new wife and their two sons, to pursue Canadian citizenship and start a financial management firm. He bought a Toronto midrise on Wynford Drive for $2.75-million and renovated it into a residential and commercial complex. He bought property on Bloor Street and Rosehill Avenue in Toronto.

Mr. Malkin seemed interested in mobility. Soon after applying to move to Canada, he obtained Israeli citizenship and his lawyer at the time asked that his application be changed to say he was a citizen of Israel instead of Russia. In addition to his Russian passport, he obtained an Israeli passport under his Hebrew name, Avihur Ben Bar, his immigration records show. His wife also carried a diplomatic passport from San Marino, in addition to her Russian passport.

But immigration officials had concerns.

On Sept. 12, 1996, Mr. Malkin spent a full day being questioned by Canadian Security Intelligence Service agents.

He was asked about an array of people, some of whom were accused of money laundering, arms trafficking and trading in conflict diamonds. Some were clients of his bank, he said, others he had no connection to.

Canadian immigration officials alleged Mr. Malkin profited from African debt relief, diverting about US$48-million intended to repay debt owed by Angola to Russia to the account of Abalone Investments Limited, a company he co-owned. Officials also questioned his involvement in Mr. Yeltsin’s presidential re-election campaign, alleging he used profits from organized crime to “subvert the democratic process in Russia.”

Through documents, interviews, hand-written letters and affidavits, he assured Ottawa he was clean, disputing all allegations.

“I am 100% law-abiding person except for overspeeding and parking tickets,” he told visa officers.

Canada’s fear, he said, stems from a belief that “most bankers in Russia are ‘mafia’ members who seek Canadian citizenship as a matter of flag of convenience only.”

Nonetheless, he was rejected on the grounds of being a member of a group engaged in organized or transnational crime, a decision he objected to.

All of the information in his case, though, is not known.

There are 21 lines of secret information in his immigration file that a Federal Court of Canada judge ruled were too sensitive to national security to allow the public, or Mr. Malkin himself, to know. There is a “secret affidavit” involving the Canadian Security Intelligence Service and a court reporter with “Top Secret clearance” was brought in for a private hearing.

Russian foreign ministers intervened on Mr. Malkin’s behalf, immigration documents say, putting “direct pressures” on Ottawa. Briefing notes on his case were prepared for Canada’s then-minister of foreign affairs, Lloyd Axworthy, before his meeting with his Russian counterpart in 1997.

Immigration officials were unmoved. As he waited for approval, Ottawa sent an alert to border agents that Mr. Malkin might try visiting Canada on his Israeli passport.

Each time Mr. Malkin’s application to come to Canada was refused, he appealed to the courts. Each time, he won a review.

Meanwhile, on Jan. 1, 2004, Mr. Malkin was named to the Russian senate as a representative of Buryatia, a region in Siberia bordering Mongolia.

In 2005, he again applied for a visitor’s visa, this time to lead an official delegation of the Russian assembly to the Canadian Parliamentary Centre, a not-for-profit organization. This, too, was denied.

“This to me was the straw that broke the camel’s back. I was embarrassed in the Russian senate. I was not allowed to see my family in Canada. I was not allowed to occupy my condo in Canada nor visit my business,” he said in a court affidavit.

Canada’s blacklisting damaged his reputation, he claimed. To compensate, he sued Ottawa for $36-million. The Federal Court rejected his claim.

In 2009, the court did grant him another crack at applying to visit here. What happened next is not on the public record, but government sources confirmed he won at least temporary acquiescence and had recently come to Canada legally.

“By allowing me to enter Canada I presume that whatever confusion or misunderstanding that resulted in visa denials in the past has been allayed,” Mr. Malkin told the Post.

Each time Mr. Malkin’s application to come to Canada was refused, he appealed to the courts. Each time, he won a review.
At the Moscow Nights restaurant, on the outskirts of Toronto, a pacing bodyguard set Mr. Malkin apart from other diners, but his message to the 15 people with him also commanded attention: He was offering money.

It was Nov. 22, the day after his Parliament Hill meeting. At the table were members of the Russian-Jewish community involved in business and charity. They were given Mr. Malkin’s business card, embossed in gold with the two-headed eagle of Russia’s coat of arms.

“He introduced himself as a Russian senator and a businessman and said he wanted to invest in a charitable cause,” said a person at the meeting who asked not to be named. “He wanted people to come up with ideas for his money but also to know what could be done for him. We talked about maybe a cultural centre and he could sponsor it, put his name on it. It looked like he wanted to clear his name and make it appear in a positive way.”

Mr. Malkin told the Post he only wants to share his success with those less fortunate.

“Given my presence in Canada, I took the opportunity to explore worthy charitable recipients for my philanthropic organization, ERA,” he said. “That is the context of my discussions with various groups and institutions in Canada.”

While he shops for philanthropic causes in Canada, Mr. Malkin’s involvement in business here has waned in recent years. He is mired in lawsuits and counterclaims with former associates in Canada and one with a lawyer that represented him in his business dispute.

The rules for Russian officials are changing, said Piotr Dutkiewicz, a leading scholar on Russian politics, who teaches at Carleton University. In the works are laws restricting foreign investments by government officials. A number of parliamentarians have already resigned in anticipation.

“What President Putin is saying is you have to choose your loyalties,” Mr. Dutkiewicz said.

“I am a Russian senator and as far as future investments outside Russia are concerned, public office holders are restricted in foreign investment so I do not anticipate new investments in Canada at this point,” Mr. Malkin said.

Further, he has “no plans to re-locate to Canada.”

Still, while the the 67-year-old Raoul Wallenberg mystery is no closer to being solved, Mr. Malkin remains open to discussing what he can do to help get to the bottom of it.

“I would be eager to offer any assistance in this regard, should I be asked by the Canadian government,” he said.

It remains unclear, however, who in the Canadian government would be willing to ask him. займ на карту онлайн buy viagra online https://zp-pdl.com https://www.zp-pdl.com займы на карту срочно