It matters where Russian money comes from; Oligarchs find it easy to settle in Britain. But more questions should be asked about them
A huge stream of money has flowed into Britain from the old Soviet Union since the end of Communism. The British public seems used to the fact that, from time to time, another flamboyant or publicity-shy oligarch whom nobody had previously heard of pops up on the radar as if descending from another planet.
All he has to do is buy a stake in a high-profile business or make a record-breaking bid on a house or country estate and a Russian billionaire or millionaire can easily break into elite British society.
Very little is required to establish oneself as a plutocrat in this country. Local banks apply meagre “know your client” procedures to vet applicants: a passport copy and a utility bill are all that is needed to open an account at any London-based private bank. Then, as if by magic, funds pour into the UK as clean capital, free from any taxation or further scrutiny. Getting the right to stay permanently in the UK with an investor visa is just as easy; all that is needed is a minimum of £2 million in personal assets.
Most rich Russians living in the UK have made their wealth honestly, but there is money sloshing around Britain tainted by corruption. Yet few new arrivals can expect to be challenged on where the money came from, or what they had to do back in Russia to acquire it.
Many in the British Establishment aren’t bothered by this laxness. After all, few Russian billionaires have so far parlayed their fortune into politics — particularly after the fuss caused when George Osborne and Peter Mandelson enjoyed the hospitality of Oleg Deripaska on his yacht off Corfu.
But you should be bothered. Evidence in the court case brought by Boris Berezovsky against Roman Abramovich gave us an insight into how those who amass (and lose) fortunes in Russia, however upright or law-abiding, have to do so against a backdrop of corruption and political interference. This case introduced British lawyers to krysha (the Russian for roof) — the protection money many businessmen pay to do business.
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The Case of Sergei Magnitsky: A Lawyer’s Death Threatens the U.S.-Russian Reset
On November 16, 2009, after 355 days of pre-trial detention, Sergei Magnitsky passed away in a Russian prison—his ailing body untreated and cruelly bound by straitjacket—as medical staff idled just outside his door. In the year since his arrest, Magnitsky had endured incarceration in a below-freezing open-air cell, living amidst sleep deprivation, isolation, raw sewage, and psychological torture. It was an unthinkable position to be in for Sergei Magnitsky, a studious and timid tax lawyer. Magnitsky’s apparent crime? Uncovering one of the largest tax frauds in Russia’s history—estimated at $230 million—and implicating a cabal of corrupt Russian Interior Ministry officers, judges, tax service officials, and known criminals.
In Putin’s Russia today, the Magnitsky case may have passed unnoticed. Here, even the most powerful voices can be silenced—no better example of this exists than the continued imprisonment of Mikhail Khodorkovsky. But due to meticulous documentation, the heinousness of the crime, and a well-organized network of advocates, the Magnitsky case has struck a rare chord of outrage in both Russia and the international community. Thanks to the campaigning of U.S. Congress members, Magnitsky’s former client, and an organization called Russian Untouchables, the Magnitsky case may yet force the Russian government to address human rights abuse allegations.
As William Browder, former client of Magnitsky and founder and CEO of Hermitage Capital Management—a global investment advisory firm—outlined in a 2009 article titled “They Killed My Lawyer,” the complicated machination that resulted in the defrauding of $230 million and Sergei Magnitsky’s death started in 2007. In June of that year, dozens of police officers raided the offices of Hermitage Capital Management and law firm Firestone Duncan—where Magnitsky worked—under the premise of tax investigation. In the months that followed, Interior Ministry officers used the confiscated and illegally obtained seals, documents, and charters of Hermitage Capital to secretly re-register Hermitage’s various investment companies in the name of a third party.
At the behest of his clients, Sergei Magnitsky uncovered the scheme: The stolen companies were being used to claim overpaid taxes—to the tune of $230 million. In turn, crooked tax authorities processed the claims and wired money to obscure shell banks. As research into the case continued and complaints by Hermitage mounted, the Interior Ministry struck back by opening criminal cases against the Hermitage lawyers investigating the fraud. As a result of harassment or threat, all but one Hermitage lawyer either left the country or went into hiding. That lawyer was Sergei Magnitsky.
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Magnitsky bill and Russian national interests
Valdaiclub.com interview with Nikolai Zlobin, Senior Fellow and Director of the Russia and Asia Programs at the World Security Institute in Washington, D.C., member of the Valdai Discussion Club.
What do you think is the likelihood that President Obama will veto the bill on visa sanctions against the Russians who are allegedly involved in human rights violations (the Magnitsky list)?
Vetoing this bill by the president of the United States is highly unlikely. The White House and the State Department have made an administrative decision with regard to this issue a long time ago. This list has been used by the State Department for a fairly long time, and these people are banned from entering the United States.
Many in the U.S. administration are saying that this move is more pro-Russian than anti-Russian. Vladimir Putin and Dmitry Medvedev have on many occasions stated the need to combat corruption. Therefore, the Americans are thus helping them by not letting in people who committed crimes in Russia and are seeking refuge abroad. These people will be unable to leave Russia and won’t be allowed to transfer their money, families or property to the United States.
If President Obama vetoes this bill, it will trigger a violent reaction in Congress, primarily among the Republicans, who are seeking to discredit his Russia policy, because he and his administration spearheaded this list. If Obama vetoes it, it will cause a huge wave of criticism.
Do you think the Magnitsky List will be expanded? When will the names on this list be disclosed?
Each country can decide who and when can cross its borders without providing any explanations. The fact that the list is being adopted by Congress as legislation makes it more stable. Otherwise, it could have been modified to accommodate internal instructions from U.S. officials. This will not happen to the Magnitsky List.
Once Congress passes the bill, they will no longer be able to keep the names on this list secret. Under the Freedom of Information Act, any journalist, including from Russia, will be able to request the names.
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Putin seeks to show he won’t buckle to U.S.
The Russian parliament intends to take up a bill Tuesday designed to hamper and frustrate civil society groups that accept money from abroad — which means, effectively, from the United States — in a move that is being portrayed as retaliation for the Magnitsky bill making its way through Congress.
The Russian legislation, which has the Kremlin’s backing, comes at a difficult moment in relations between Washington and Moscow, characterized by sharp disagreements over Syria and missile defense, and deep ambiguities concerning Iran. From the start, the Obama administration has tried to avoid linking one issue to another in its Russia policy — making trade agreements dependent on progress on human rights, for instance.
Indeed, the administration opposes the Magnitsky bill, which would bar from the United States those officials who were involved in the imprisonment and subsequent death of the whistleblower Sergei Magnitsky. But the deepening bilateral strains place the White House’s compartmentalization at risk.
The key moment was Vladimir Putin’s return to the presidency in March elections.
“Deep down, Putin believes the West is an opponent,” said Georgy Mirsky, an expert on Russia’s Middle East policy. “Not an enemy; he doesn’t believe there will be American aggression against Russia, no. But he believes the West is always trying to find a weak spot in our armor, to enrich itself at our expense — and we must respond in kind.”
That explains Putin’s position on Syria, Mirsky said — and it would explain the new attack on nonprofit organizations. Putin has accused civil society groups of working at the behest of foreign powers and of trying to foment political upheaval. He accused Secretary of State Hillary Rodham Clinton of giving the go-ahead to anti-government demonstrations in Russia last winter.
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Foreign-Funded Nonprofits in Russia Face New Hurdle
In the latest move to rein in dissent, Russian authorities have introduced a draft law that would require nonprofit organizations that receive financing from outside Russia to publicly declare themselves “foreign agents” — a term that, to Russians, evokes cold war-era espionage and is likely to discredit the organizations’ work in the eyes of the public.
Lawmakers from United Russia, the governing party, have accelerated work on the bill and are scheduling the first of three readings on Friday. If passed, the bill would complement a new law penalizing Russians for taking part in unauthorized protests, which was rushed through Parliament at a similar pace last month.
The bill would also put new burdens on nonprofit groups with foreign financing that are judged to be involved in politics, including annual audits and unannounced checks for the use of “extremist speech” in published materials. Organizations could face fines of as much as 1 million rubles, or $30,000, for violations.
Rights activists have excoriated the proposal as an attempt to discredit their work, arguing that Russian donors are afraid to support organizations that criticize the government, which then leaves them dependent on foreign sources for money.
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New bill labels NGOs as ‘foreign agents’
A new bill soon to be introduced to the State Duma will label all NGOs with foreign finances that work in politics as “foreign agents,” United Russia’s press-service announced on Friday.
“One of the authors of the bill, deputy Alexander Sidyakin, stresses that the proposed changes to the law on NGOs do not ban them in any way and do not limit their rights, but are aimed at providing public scrutiny for their functions as a foreign agent and to make this data open knowledge for Russian citizens,” Interfax quoted United Russia’s press-release as saying.
United Russia member Sidyakin was also one of the authors of the new rally fines bill.
Foreign agents with a political agenda
Russian NGOs that receive funding and property from foreign states, international and foreign organizations, foreign nationals will be recognized as “foreign agents” in the new bill. NGOs that “take part in political activity in Russia in the interests of foreign sources” will be also be considered agents.
United Russia explained that NGOs that take part in Russia’s political life are the ones that “regardless of declared aims and tasks, finance and hold political campaigns in order to influence the decision-making by the state organs, aimed at changing state policies,” as well as participating in forming public opinion with said aims.
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The Sergei Magnitsky Act: Russia Warns Obama Not to Pass Human Rights Bill
Sergei Magnitsky was a 37-year-old attorney in Russia who uncovered a plot so sinister that he was thrown in prison. He found, during the course of his work, that some officials were involved in an alleged scheme to embezzle hundreds of millions of dollars from the Russian treasury.
When his firm, Hermitage, contacted the government to expose the plot, Magnitsky himself was investigated and the chain of events that would follow led to his death in prison where he was denied medical treatment and beaten by prison guards. Sadly, he died days before the one year limit that he could be held without trial.
An article by Owen Matthews titled, “There’s something rotten in the state of Russia” published in the Spectator reported:
“According to [Magnitsky’s] heartbreaking prison diary, investigators repeatedly tried to persuade him to give testimony against Hermitage and drop the accusations against the police and tax authorities. When Magnitsky refused, he was moved to more and more horrible sections of the prison, and ultimately denied the medical treatment which could have saved his life.”
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Russia’s Counter To Magnitsky Bill
Russia is planning to sanction all supporters of the Magnitsky Act, Russian Izvestia daily reported. The US Senate approved a bill last week that would impose financial and visa restrictions on foreign officials connected to human rights abuse. The bill is named after a Russian anti-corruption lawyer Sergei Magnitsky, who was allegedly killed in prison by police.
Russia reacted to the Magnitsky Act with threats, as the bill was originally drafted to impose sanctions specifically on Russian officials involved in human right abuses. Izvestia reported on Friday that the Russian Parliament is discussing a long list of individuals who might be banned from Russia under a draft “Law On Measures against Individuals Involved in Violation of Russian Citizens’ Rights Abroad.” This law was introduced in June 2011.
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Matvienko and Clinton discuss “Magnitsky law”
The discussion of the “Magnitsky law” in the US Senate is an attempt to influence Russian investigative and judicial institutions, the speaker of the Federation Council, Valentina Matvienko, said at a meeting with the US Secretary of State Hillary Clinton, RIA Novosti reports.
On Tuesday, the law about visa sanctions for the Russian bureaucrats allegedly connected to the death in prison of the lawyer Sergei Magnitsky in 2009 was approved by the international committee of the
US Senate.
“We would understand if it was some universal law that would forbid the entrance to the US of state employees and bureaucrats that violate human rights. But it is obvious that the situation with
democratic development is not that bad in Russia,” Matvienko added.
According to Matvienko, Clinton promised to try to remove this amendment. займ на карту займ онлайн zp-pdl.com https://zp-pdl.com/apply-for-payday-loan-online.php микрозайм онлайн
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To learn more about what happened to Sergei Magnitsky please read below
- Sergei Magnitsky
- Why was Sergei Magnitsky arrested?
- Sergei Magnitsky’s torture and death in prison
- President’s investigation sabotaged and going nowhere
- The corrupt officers attempt to arrest 8 lawyers
- Past crimes committed by the same corrupt officers
- Petitions requesting a real investigation into Magnitsky's death
- Worldwide reaction, calls to punish those responsible for corruption and murder
- Complaints against Lt.Col. Kuznetsov
- Complaints against Major Karpov
- Cover up
- Press about Magnitsky
- Bloggers about Magnitsky
- Corrupt officers:
- Sign petition
- Citizen investigator
- Join Justice for Magnitsky group on Facebook
- Contact us
- Sergei Magnitsky
