EU countries launch joint probe into Magnitsky affair
Financial sleuths from six EU countries are joining forces to see if millions of euros of stolen Russian mafia money was laundered through their banks.
The move comes after the European Commission introduced a request for a joint investigation at a meeting of the so-called Financial Intelligence Units platform (FIU.net) on 7 February.
FIU.net holds regular meetings of anti-corruption experts from EU interior ministries and operates a secure IT network helping them to exchange data.
Cyprus, Estonia, Latvia and Lithuania were already looking into allegations that some of the €230 million euros embezzled by the “Klyuev group,” an organised crime syndicate, from Russian tax authorities in 2007 was wired via Russian and Moldovan banks to companies in their jurisdictions.
Austria and Finland have also carried out probes.
Their prosecutors earlier said there is no evidence that crimes were committed on their territory.
But an EU commission source, who asked to remain anonymous, noted that they are taking part in the 7 February initiative. “There was no negative reaction from any member state … The FIUs are working on the case and there will be a follow-up meeting before the summer,” the contact said.
The Kluyev investigation is a potentially explosive issue in EU-Russia relations.
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Habeas corpus
Irish Times
Sergei Magnitsky, the defendant, will not be in a position to plead. He is dead. His trial, however, following some celebrated historical precedents (notably, Joan of Arc’s), will proceed even though, as Amnesty says, it violates his fundamental rights, in particular that “to defend himself in person”.
The bizarre, and very rare, decision of the Russian authorities to go ahead with the trial is possible because the law allows a posthumous trial to continue – it closed 13 days after his death in 2011 – but only at the request of relatives anxious to clear an accused’s name. Yet Magnitsky’s mother is adamantly opposed to the reopening, and the prosecuting authorities have no intention of clearing his name. On the contrary, the point, it appears, is to discredit both Magnitsky and a US sanctions law named after him which offends President Vladimir Putin and some of his corrupt pals.
Prosecutors accuse Magnitsky and his former client William Browder, a London-based investor, of evading €12.6 million in tax. The former was arrested in 2008 while investigating a €170 million tax fraud. He died in jail after developing untreated pancreatitis. The US Congress passed a law sanctioning officials whom Browder accuses of involvement in the fraud, and Russia responded by banning adoptions by Americans.
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U.S.-Russia Relations Continue To Falter With Prosecution Of Dead Man
Russia is prosecuting a dead man, corruption whistle-blower Sergei Magnitsky, in a case that has severely complicated U.S.-Russia relations. Congress passed a bill that will punish anyone involved in the Magnitsky case and other major human rights violators in Russia. The Russian parliament responded by banning adoptions by American families of Russian children. It is against this backdrop that the new Secretary of State John Kerry finds himself searching for ways to reset relations once again.
MELISSA BLOCK, HOST:
You are listening to ALL THINGS CONSIDERED from NPR News.
Next week, Secretary of State John Kerry sets off on his first official trip. He’ll head to both Europe and the Middle East. He will not be visiting Russia but aides say he might meet his Russian counterparts somewhere on the trip.
They have a lot to talk about, from the crisis in Syria to a dispute over adoptions, as NPR’s Michele Kelemen reports.
MICHELE KELEMEN, BYLINE: There are many signs that U.S./Russian relations are in the tank. One example is playing out in a Russian courtroom, where a dead man is going on trial next month.
NIKOLAI GOROKHOV: (Foreign language spoken)
KELEMEN: This is Nikolai Gorokhov, a lawyer representing the family of Sergei Magnitsky, the corruption whistle-blower who died in a Russian prison three years ago.
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Russia’s missing billions revealed
Russia’s central bank governor has lifted the lid on $49bn in illegal capital flight last year – more than half of which, he says, was controlled “by one well-organised group of individuals” that he declined to name.
Sergei Ignatiev, due to step down in June after 11 years in his post, is seldom outspoken about any issue other than interest rates. But he unburdened himself in an interview with the Moscow newspaper Vedomosti about money leaving the country through the back door, which he said equalled 2.5 per cent of gross domestic product last year.
“This might be payment for supplies of narcotics . . . illegal imports . . . bribes and kickbacks for bureaucrats . . . and avoiding taxes,” he told the daily, which is part-owned by the Financial Times.
Russia’s central bank has access to daily monitoring data on all payments within the commercial banking system, and Mr Ignatiev said the $49bn figure was mainly drawn from analysing “payments made by Russian organisations to non-residents, the stated aims of which are clearly false”.
He added: “Apart from this, our analysis shows that more than half of the total of shady operations is conducted by firms directly or indirectly linked to each other by payments. The impression is created that they are all controlled by one well-organised group of individuals.”
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Russia central banker slams vast criminal cash export
Russia’s central bank chief complained on Wednesday that some 2.5 percent of the national income was illegally siphoned abroad last year – a revelation critics said showed the extent of corruption under Vladimir Putin.
Bank of Russia chairman Sergei Ignatyev, who is about to retire, reckoned much of that sum, close to $50 billion, was controlled by a single group of people; he did not identify them but many saw it as an indictment of the “Kremlin capitalism” which has taken hold since Putin first became president in 2000.
One prominent critic called it “state money-laundering”.
“You get the impression that they are all controlled by one well organized group of people,” Ignatyev told Vedomosti newspaper in a front-page interview after a Bank study found more than half the flows involved firms linked to each other.
“With a serious concentration of efforts by law enforcement agencies, I think it is possible to find these people,” added Ignatyev, 65, who will retire in June after 11 years running an institution which has won widespread respect for integrity.
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Soviet Jewry activist sees fight unfinished
For Larry Lerner, there’s a clear connection between a lonely Russian child hoping to find a home with adoptive parents in the United States in 2013, and a doggedly determined refusenik in the 1980s, dreaming of freedom in Israel.
Lerner, who lives in Warren, sees them as part of the same push-and-pull effort that engaged American Jews in the decades-long Free Soviet Jewry movement.
“You can’t get people in this country to support the fight for human rights these days,” the retired attorney told NJ Jewish News in a recent interview. “But this kind of fight is never over. You have to keep at it, monitoring what’s going on, and working to raise awareness.”
And keeping at it is what he does, as president, since 2009, of the Union of Councils for Jews in the former Soviet Union (UCSJ). One of the most important organizations in the heady struggle for Soviet Jewish emigration, UCSJ now hopes to re-engage the American-Jewish community in the broader struggle for justice and human rights in Russia and the rest of the former Soviet Union.
According to the Human Rights Watch annual report, 2012 was “the worst year for human rights in Russia in recent memory,” with Vladimir Putin’s government imposing new laws to limit public assembly, restrict access to the Internet, increase fines for protesters, and recriminalize libel. Nongovernmental organizations that receive foreign funding must register as “foreign agents.”
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Sergei Magnitsky: How a dead man was put on trial
THE court calls Russian lawyer Sergei Magnitsky. He’s a bit slow to take the stand. He’s a bit quiet. This is because Sergei Magnitsky is dead. He died in a Russian prison from pancreatitis. He’s buried at Moscow’s Preobrazhensky cemetery.
Mr Magnitsky was first arrested in 2008. The lawyer with US firm Firestone Duncan had been working for London-based Hermitage Capital Management. He claimed to have uncovered a massive fraud worth £125m. He told all to officials. He was then arrested for alleged tax evasion and sent to prison, where he was beaten and denied medical help. He was had been held for a year without charge. Well, just under a year. In Russia, you can be held for anything up a year without charge. That time would have lapsed on November 24. He died on Monday, November 16. Such was his misfortune.
He was kept in squalor. In his affidavit, Magnitsky noted:
“…sewage started to rise from the drain under the sink [the] floor was covered with sewage several centimetres thick … for the 10 months I have been under arrest, the investigator has not let me meet with my wife, mother or any other relative”. “Isolation from the outside world exceeds all reasonable limits …
In July 2009, Magnitsky was diagnosed with “gall bladder stones, pancreatitis and calculous cholecystitis“. He blamed that on his confinement:
“Prior to confinement, I didn’t have these illnesses or at least there were no symptoms.”
Irina Dudukina, spokesman for the prosecutors’ investigative committee, said in November 2009:
“He was a key witness and his evidence was very important. The tragic news about his death came as a complete surprise. He had complained about the conditions of his detention but never his health.”
Spokeswoman for the Interior Ministry’s Investigative Committee Irina Dudukina speaks at a news conference on the death of lawyer Sergei Magnitsky in Moscow, Wednesday, Nov. 25, 2009.
Bill Browder of Hermitage Capital said Sergei Magnitsky, had in effect been “held hostage and they killed their hostage”. He had hired Magnitsky to search for fraud against his company. The Russian elite were not willing to play fair:
In 2005, Mr Browder was banned from Russia as a threat to national security after allegations that his firms had evaded tax, but Mr Browder says his company was targeted by criminals trying to seize millions of pounds worth of his assets. Mr Browder says he was punished for being a threat to corrupt politicians and bureaucrats. Since then, a number of Mr Browder’s associates in Russia – as well as lawyers acting for his company – have been detained, beaten or robbed.
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Arraigning a corpse
Part 1 “Russian Justice”
A judge at Moscow’s Tverskoi District Court, stopped the trial of Sergei Magnitsky (above) yesterday – but not because the defendant was dead. Magnitsky’s demise was of no concern to the judge. It did not bother him in the slightest. The court merely postponed proceedings until 4 March when the world will see something rarely seen since the Middle Ages: a prosecutor arraigning a corpse.
The Putin regime – that mixture of autocracy and gangsterism – is desperate to discredit the late Mr Magnitsky and his employer, Bill Browder of Hermitage Capital. If you don’t know the story, I’ll explain why.
Browder exposed corruption in Russian companies. The Russian authorities did not approve. Interior Ministry police raided Hermitage’s offices after Browder and most of his employees had fled the country.
Magnitsky stayed and claimed that the Interior Ministry police had stolen the seals to its Russian subsidiaries and passed them to a crime gang. The gang re-registered the companies and claimed to be Hermitage’s rightful owners. They told the Russian authorities they owed Hermitage a tax rebate. Within a day, corrupt officials handed over £143m of public money.
Magnitsky complained to the Russian equivalent of the FBI. Russia being the way it is, the Interior Ministry arrested him for speaking out. The state held him for a year in wretched prisons. In June 2009, Magnitsky developed pancreatitis and cholecystitis. The prison authorities denied him treatment. They probably tortured him, too. When civilian doctors finally came to see him on the day of his death, the guards would not let them into his cell for an hour. The doctors found his body lying in a pool of urine. He died rather than retract his testimony.
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Disarray Among Putin’s Elites Deepens as Russia’s Self-Isolation Progresses
The meteor that exploded over Chelyabinsk in the early hours of February 15, as damaging as it was, produced even more jokes than material destruction. One of those was about the State Duma urgently approving legislation banning the incursions of celestial bodies because of their pronounced anti-Russian inclinations (Newsru.com, February 15). The joke captures the frantic activity of the Russian parliament, which has lost legitimacy in the crudely falsified elections in December 2011. As a result, the Duma now tries to compensate for this disgrace by producing a deluge of laws aimed at restricting the growth of the country’s fledgling civil society and promoting “patriotism” even in such ugly forms as the prohibition of adoption of orphans by American families. Consequently, this commonly disparaged institution is now seen by a record high 42 percent of Russians as playing a big or very big role in Russia’s political life (Levada.ru, February 14). The unintended consequence of this attention-seeking behavior, however, has been a series of scandals that reveal the scope of corruption among the parliamentarians who are supposed to represent a key part of the political establishment (Moskovsky Komsomolets, February 14).
Vladimir Pehtin, the head of the committee on parliamentary ethics, had to resign from this chair after the publication by activist-blogger Alexei Navalny of documents confirming his ownership of a condo in Miami, which was not mentioned in his tax declaration (RIA Novosti, February 13). This revelation could have gone unnoticed, if it had not coincided with President Vladimir Putin’s introduction of a draft law that would prohibit a wide group of key state officials from holding bank accounts abroad, while all real estate owned overseas would need to be declared (Nezavisimaya Gazeta, February 13; see EDM, February 14). The aim of this legislation is to ensure loyalty among the prime beneficiaries of the “power-is-money” regime through the newly-launched campaign of “nationalization of the elites” (Forbes.ru, February 13). The predatory elites, however, remain reluctant to be “nationalized” in terms of repatriating their ill-gained fortunes. Keeping their wealth abroad allows them to enjoy a level of property rights, which are mostly non-existent in Russia.
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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
