The turmoil of post-Soviet Russia in the 1990s saw a handful of business people grow rich, while the country itself grew poor.
Into the mix of chaotic capitalism and Wild West opportunity stepped a young Stanford business graduate ready to make his fortune: Bill Browder founded what would become the largest foreign investment fund in Russia, Hermitage Capital Management, worth $4.5bn in assets.
While pushing his own ventures, he spoke out about a culture of corporate corruption and soon fell foul of Russia’s new president, Vladimir Putin.
In 2005, Browder was expelled from the country and declared a “threat to national security”. His Hermitage investment fund was raided, and, he says, a complex fraud conducted by Russian officials resulted in the theft of some $230m.
It was a scheme uncovered by Browder’s lawyer, Sergei Magnitsky, whose later death in prison – apparently the result of torture – set Browder on a lifelong mission to expose corruption.
“They killed him in a horribly sadistic way at the age of 37 and I’ve been going after them ever since they killed him,” Browder said in an interview with Al Jazeera.
If they are ready to kill for money, there’s nothing more painful for them than to have their money frozen. And even if you haven’t frozen their money, just the idea that their money could be frozen is like a sword of Damocles hanging over their head. And that’s why Putin hates the Magnitsky Act so much because he is a kleptocrat first and foremost.
At the time of its passage, the Magnitsky Act targeted 18 Russian individuals, barring them from US entry and US bank dealings. In 2016, it became the Global Magnitsky Human Rights Accountability Act, empowering the executive branch to impose targeted sanctions or visa bans on individuals who committed human rights violations anywhere in the world.
It has drawn the ire of the Russian president who, in 2018, said that he would grant the US access to 12 indicted Russian intelligence officials in exchange for access to several Americans, singling out US-born Browder and accusing him of not paying taxes while in Russia. In 2016, a Russian lawyer allegedly lobbied for repealing the Magnitsky Act and indicting Browder in a Trump Tower meeting with members of then-candidate Donald Trump‘s team.
“We know for sure that the Russians were there because of me and the Magnitsky Act … Russia is a country, where … a thousand individuals have stolen a trillion dollars over a 20-year period … and the other 145 million Russians are in destitute poverty,” said Browder.
“What the Magnitsky Act does … is go after those 1,000 people. If they are ready to kill for money there’s nothing more painful for them to have their money frozen. And even if you haven’t frozen their money, just the idea that their money could be frozen is like a sword of Damocles hanging over their head. And that’s why Putin hates the Magnitsky Act so much because he is a kleptocrat first and foremost.
“This law Putin hates so much, and that’s the reason why he hates me. And the fact that this law is causing him so much grief, is something which shows that we’ve got him back … I’m living rent-free in Putin’s head.”
Browder has also been investigating what happened to the millions of dollars that disappeared when his investment fund was raided – which has raised the question of whether or not Trump cropped up along the money trail.
“We’ve traced that for nine years and we’ve found all the money … through law enforcement investigations, through private investigations, through whistleblowers, and so far there has not been any money that went to Donald Trump,” Browder said. “Having said that, there’s a lot of money that went to Vladimir Putin.”
Critics of Browder may argue that he is being hypocritical; like the oligarchs he went after, Browder had taken advantage of the upheaval following the collapse of the Soviet Union to do business. But he says that he did things differently.
“The only similarity is that we were both investing in the system at the very same time. The difference was that almost immediately after I started, I started exposing corruption,” he said. “I was doing it for money, I wasn’t doing it for the goodness of the state. But to invest in companies, expose corruption, and try to stop it, that … [by definition] is a good thing.”
Now, he says Magnitsky-inspired laws are catching on quickly.
“The Magnitsky Act has now turned into a viral phenomenon. It’s jumping from country to country to country. There’s Magnitsky proposals all over the world in different parliaments and governments, etcetera, and of course I can help and stir up the pot and make things happen, but without my presence they would happen at the same time,” he said.
And he considers seriously that he may not be present; he feels under constant threat of being captured or killed by the Russian government.
“I live in a very precarious position where I could be killed, arrested, illegally rendered back to Russia. But I don’t spend my life living in fear … I am not the person who is going to live in fear, I am not the person who is going to withdraw, I am not the person who is going to go into hiding. My reaction is to go straight back at them,” he said. “Fate may deal me a very ugly blow but that’s the decision I’ve taken.”
Source: Al Jazeera News
The turmoil of post-Soviet Russia in the 1990s saw a handful of business people grow rich, while the country itself grew poor. Into the mix of chaotic capitalism and Wild West opportunity stepped a young Stanford business graduate ready to make his fortune: Bill Browder founded what would become the largest foreign investment fund in Russia, Hermitage Capital Management, worth $4.5bn in assets.