How Bill Browder Became Russia’s Most Wanted Man

The hedge-fund manager has offered a fable for why the West should confront Putin.

.. Putin did not speak of what is surely the true source of his animus: Browder’s decade-long campaign against Russian corruption. In 2009, Browder’s tax adviser Sergei Magnitsky testified that the Russian police and tax authorities had attempted to steal two hundred and thirty million dollars in Russian taxes paid by Browder’s Moscow-based investment firm, Hermitage Capital.
.. Since the Magnitsky Act passed, the Russian government has charged Browder with myriad crimes, and has periodically tried to lodge warrants for his arrest via Interpol. “Their main objective is to get me back to Russia,” Browder has said. “And they only have to get lucky once. I have to be lucky every time.”
.. In 2012, in Surrey, England, Alexander Perepilichny, one of Browder’s chief sources of information on the movement of the stolen funds, collapsed while jogging near his home and died. The case is still under investigation. Browder, who has taken to relating to as large an audience as possible the danger he faces, has called this “a perfect example of why you don’t want to be an anonymous guy who drops dead.”
.. Browder, who is fifty-four, with a dusting of silver hair and rimless eyeglasses, has a forceful yet understated authority and a talent for telling a coolly suspenseful tale.
.. As an anti-corruption activist, Browder has spoken out against the exploitation of offshore tax havens—for example, the ones detailed in the documents that were leaked from the Panamanian law firm Mossack Fonseca, in 2016. Many companies listed in the so-called Panama Papers were entirely legal. Still, Browder tends not to mention that Mossack Fonseca set up at least three firms for him and Hermitage.
.. His singling out of Browder in Helsinki, McFaul told me, “only gives Bill a bigger global platform—it was a huge public-relations coup, which of course Bill will use.”
.. His grandfather Earl Browder became active in socialist politics during the First World War and lived in the Soviet Union for five years before becoming the secretary-general of the Communist Party of America. Earl’s son Felix was a noted mathematician. William Browder took an interest in business while in boarding school in the seventies. “I would put on a suit and tie and become a capitalist. Nothing would piss my family off more than that,” he writes in “Red Notice.”
.. This was the peak of the chaotic post-Soviet “Wild East,” a time of lawlessness and speculation. Over the next two years, Hermitage’s portfolio grew to more than a billion dollars, but it was nearly wiped out in August, 1998, when Russia defaulted on its sovereign debt, causing widespread panic. Browder was one of the few Western financiers who chose to remain in the country. Between 1998 and 2005, the price of oil quadrupled and the Russian stock index went up by nearly three thousand per cent... Browder gained attention for publicly criticizing the management of companies in which his fund had invested as a minority shareholder, in an effort to goad them into being more efficient and transparent. He held combative press conferences outlining Russian corporate malpractice and passed along to journalists dossiers that described the way venal oligarchs engaged in asset stripping, wasteful spending, and share dilutions.

.. “I don’t think Bill started out with a passion for corporate governance. He found it to be an instrument that helped him and his investors make a lot of money. Ultimately, it became a sincere crusade.”

.. Steven Dashevsky, then the head of research at a Russian investment bank, Browder’s anti-corruption stance was a kind of “free marketing” for Hermitage.

.. Regulators had instituted a dual price structure for the company’s shares: one class of shares, priced relatively cheaply, could be held only by Russian citizens and firms; the second class, priced much higher, could be purchased by anyone. Hermitage got the cheaper price by buying Gazprom stock through companies it registered in Russia. It was a work-around used by a number of Moscow-based investment funds that, as Dashevsky put it to me, “fell into a gray zone: it was clearly against the spirit of the law, but never prosecuted or pursued.”

.. Browder also minimized how much Hermitage paid in Russian taxes. The government, in an effort to stimulate regional investment, had established a special zone in Kalmykia, a republic north of the Caucasus, that offered a lower tax rate. The rate went down even more if disabled workers made up a majority of a company’s employees. To take advantage of this, Hermitage hired disabled people for its companies in Kalmykia. A banker who managed a number of Russian funds said, “We’re not generally disciples of Mother Teresa, but Bill was singularly bottom-line focussed.” Other investors, the banker said, considered tax-avoidance measures like Hermitage’s hiring of disabled people “too risky, and borderline illegal, with the possibility of too much danger if revealed.”

.. Browder received a British passport in 1998 and, rather than become a dual citizen, renounced his U.S. citizenship. He has explained that he had been motivated by the discrimination that his grandparents faced in America during the McCarthy era as a result of their political activism for the Communist Party: his grandfather was forced to testify in front of the House Un-American Activities Committee, and his grandmother was threatened with deportation to Russia. “This type of thing could never happen in Britain, and that was the basis of my decision to become British,” he recently told an audience in Colorado. But those I talked to who knew Browder in the nineties assumed that the reasons were financial

.. “If there has been a consistent passion in Bill’s life over the last twenty or thirty years, it is not wanting to pay taxes.”

.. Vladimir Putin assumed the Presidency in 2000, and at first Browder was an ardent supporter

.. In 2003, when the billionaire head of the Yukos oil company, Mikhail Khodorkovsky, was arrested and charged for fraud and tax evasion, many saw it as evidence that Putin was becoming uncompromisingly authoritarian. But Browder welcomed the prosecution of Khodorkovsky, with whom he had clashed in the past. In 2004, he told the Times, “We want an authoritarian—one who is exercising authority over mafia and oligarchs.” He added that Putin “has turned out to be my biggest ally in Russia.”

.. He was told that his Russian visa had been annulled on national-security grounds.

.. “Logic dictates that it’s not in the national interest to ban the biggest investor in Russia and one of the biggest supporters of the government’s policy.”

.. In July, 2006, Putin was asked at a press conference about Browder. Putin said that he didn’t know the particulars of the case, but added, “I can imagine this person has broken the laws of our country, and if others do the same we’ll refuse them entry, too.” Browder instructed his Hermitage colleagues to sell off the firm’s Russian assets and moved key staff to London.

.. Actually, Magnitsky, then thirty-five, was a tax adviser who worked for the firm that had advised Hermitage for a decade.

.. police had used the impounded seals and stamps to reregister Hermitage’s companies in the name of low-level criminals, and those companies then applied for tax refunds totalling two hundred and thirty million dollars, the amount that Hermitage had paid in capital-gains tax. Two state tax offices in Moscow appeared to have approved the refunds the next day.

.. Magnitsky testified to Russian state investigators in June, 2008, after which his lawyer advised him to leave the country. He refused, and gave further testimony that October. Several weeks later, he was arrested on charges of abetting tax evasion through Hermitage, and held in pretrial detention.

.. In 2010, Browder went to Washington with a list of Russian officials he said were to blame. The Obama Administration placed sanctions on some of them, a routine procedure that barred them from entering the United States. McFaul, then in charge of Russia policy at the National Security Council, recalls, “Bill, to his credit, said, ‘That’s not enough. You didn’t make it public. You didn’t seize any assets.’ ” In “Red Notice,” Browder calls the Russia policy of the Obama Administration at the time “appeasement.”

.. “But what was unique here was Bill Browder,” he said—in particular, Browder’s ability to tell the story of Magnitsky’s suffering. “We were as outraged as he was,”

..  Browder gave testimony, said, “I think it boils down to one phrase I heard him use numerous times: ‘They killed my guy.’ He feels a responsibility and obligation to make sure Sergei didn’t die in vain, and it’s hard to argue with that.”

.. Even so, the Magnitsky Act might have languished had it not been for the fact that, in 2012, Russia was about to become a member of the World Trade Organization. In order to grant Russia what the group calls “permanent normal trade relations” status, Congress would have to repeal the Jackson-Vanik amendment, a 1975 measure aimed at the Soviet Union that penalized trade with countries that had restrictive emigration policies. Legislators did not want to rescind the law without sending the Kremlin a message about American toughness on human rights.

.. “the real question was whether Congress and the White House could find any substitute for Jackson-Vanik other than Magnitsky. The answer turned out to be no, they couldn’t.”

.. “It means his krysha doesn’t work,” Celeste Wallander explained. Krysha is Russian for “roof,” and in criminal jargon means the protection that a powerful figure can offer others. “It screws up his social contract with those inside the system,” she said.

.. But Canada, the Baltic states, and the U.K. have passed their own Magnitsky-style bills, and, last year, Congress passed the Global Magnitsky Act, which targets human-rights abusers worldwide. McFaul told me it had long struck him that “the spectre of the Magnitsky law and the noise around it are much more important than the law itself.”

.. The main evidence that the law is having an effect is how obsessed Putin is with it. I don’t get why he’s so obsessed, but the fact remains that he is, and that suggests it’s had a tremendous impact.

.. I met Veselnitskaya last fall in Moscow, at a café in the center of town; she is an imposing, glamorous woman with an exhaustive memory for dates and facts. She doesn’t speak English, is not licensed to practice law in New York, and, at the time the charges were filed, had never been to the United States.

.. She and the Baker Hostetler lawyers wanted Browder deposed as part of pretrial discovery. This would require a court subpoena; Browder had not voluntarily agreed to testify and, having given up his U.S. citizenship, was not immediately liable to the jurisdiction of a U.S. court.

.. According to multiple sources familiar with the Katsyv family’s legal strategy, the legal work on the Prevezon case and Veselnitskaya’s related lobbying carried costs of up to forty million dollars—a vast sum, considering that the U.S. government was trying to seize, at most, fourteen million dollars’ worth of property.

.. Veselnitskaya downplayed any ties she had to Yuri Chaika, Russia’s general prosecutor, but a researcher on the Prevezon case told me that she often took his calls.

 

Former Trump Aide Carter Page Was on U.S. Counterintelligence Radar Before Russia Dossier

Court documents, testimony show foreign-policy adviser was known to authorities as early as 2013

Carter Page, who served as a foreign-policy adviser to Donald Trump’s campaign, was known to U.S. counterintelligence officials for years before he became a prominent figure in a dossier of unverified research about the future president’s ties to Russia.

What prompted the FBI to suspect that Mr. Page was acting as an agent of Russia?

.. the former Trump aide has been known to U.S. counterintelligence officials dating back to at least 2013, nearly three years before he joined the Trump campaign.
.. Mr. Page’s dealings with Russia date back to more than a decade before Mr. Trump ran for president and his opponents began crafting the dossier.For three years, starting in 2004, Mr. Page was living in Moscow, where he opened an office for the investment banking firm Merrill Lynch & Co. He also served as an adviser on “key transactions” involving the Russian state-owned energy company PAO Gazprom and RAO UES, the Russian state-controlled electricity monopoly, according to Mr. Page’s biography.

.. In January 2013, Mr. Page was in New York at an Asia Society event on China and energy development, when he met Victor Podobnyy, a junior attaché at the Russian consulate in New York City who was in the audience
..  March 2013, Mr. Page met with Mr. Podobnyy again over coffee or a Coke, he told the House panel in his testimony. Mr. Page, asked why he had sought out Mr. Podobnyy a second time, said he wanted to practice his Russian.
.. He was interviewed by FBI counterintelligence agent Gregory Monaghan and another FBI agent, who were investigating whether Mr. Podobnyy was a Russian intelligence agent
.. In 2015, Mr. Podobnyy was charged with posing as a U.N. attaché under diplomatic cover while trying to recruit Mr. Page as a Russian intelligence source.
.. The criminal complaint filed by U.S. federal prosecutors alleged Mr. Podobnyy was an agent for the SVR, Russia’s foreign intelligence service. The complaint also detailed Mr. Podobnyy’s discussion in April 2013 with Igor Sporyshev, a second alleged SVR agent posing as a Russian trade representative, about efforts to recruit “a male working as a consultant in New York City.” Mr. Podobnyy was afforded diplomatic immunity and left the country.
.. Mr. Page had provided the Russians with documents, which Mr. Page said were “nothing more than a few samples from the more detailed lectures” he was preparing for a course he was teaching at New York University at the time.
.. Over the course of the campaign, Mr. Page traveled to Russia at least twice and kept top Trump campaign advisers abreast of his travels
.. In the speech, he criticized the U.S. and European states for their behavior toward states of the former Soviet Union for their “often hypocritical focus on ideas such as democratization, inequality, corruption and regime change.”
.. He declined to answer questions after the speech about U.S. politics, saying that the purpose of his speech was academic, and refused to meet with reporters, leaving the auditorium through an exit backstage.
.. Mr. Page told the House that while in Moscow, he “briefly said hello” to Arkady Dvorkovich, deputy prime minister of Russia, and met with Andrey Baranov, head of investor relations at Russian oil giant PAO Rosneft... Before hiring Mr. Steele, the firm’s research had been paid for by a conservative news outlet that opposed Mr. Trump. 

.. Mr. Page’s name surfaced repeatedly in the fall of 2016 in classified briefings given to high-level members of Congress, according to people familiar with the matter. That was around the same time the FBI and the Justice Department were applying for a surveillance warrant against Mr. Page in the FISA court.

He used to rule Germany. Now, he oversees Russian energy companies and lashes out at the U.S.

For seven years, Gerhard Schröder was the leader of the most populous democracy in Western Europe. He modernized the country’s social security system, angered George W. Bush by refusing to participate in the invasion of Iraq and was only narrowly ousted in an election defeat to Angela Merkel in 2005. Schröder could have easily spent the rest of his career as an elder statesman, attending summits and writing books.

Instead, Schröder — a friend of Vladimir Putin who has defended Moscow’s top man as a “flawless democrat” — opted for a career in the Russian business world.

Schröder has spent much of the past decade working for the Russian energy industry, serving as a board member of several consortia in which Russian-government-controlled energy company Gazprom is either the majority or sole shareholder

.. At a time when Russian business connections among members of Trump administration have come under growing scrutiny, Schröder’s case stands out as the perhaps most blatant example of a Western politician having conflicts of interests when it comes to Moscow. “By becoming a well-paid official of a foreign, aggressive power he has damaged the reputation of the political class more than any other living politician,”

.. he went on to criticize the United States’ “monstrous” political influence, and he urged Germans to ignore Trump’s demands to spend at least 2 percent of GDP on defense. There was long applause for his remarks, which implied the need to improve relations with Russia.

.. Schröder’s renewed popularity among parts of the German left has also stunned conservatives, who are concerned about possible Russian election interference in September.

.. As chancellor, Schröder championed the North Stream pipeline deal with Russia. The German government pursued the offshore pipeline between Russia and Germany to cut energy costs and establish a reliable supply route, but the U.S. largely viewed it as a Russian attempt to make Europe more dependent on the Kremlin.

.. Fears in Washington over the pipeline date back to 2005, when Schröder hastily signed the deal during his last days in office. Then, just weeks after leaving politics, he began to oversee the implementation of the gas pipeline project himself — this time as a businessman in Russia and as the head of Nord Stream AG’s shareholder committee.

.. In 2014, at the height of the Ukraine crisis, Schröder celebrated his 70th birthday with Putin, sparking an international backlash. By opting for a post-politics business career in Russia, his critics said, Schröder had essentially chosen to join the Putin administration.

.. He’s also remembered as a “fighter with guts,” as Benner put it, for standing up to the U.S. during the Iraq War — something the Trump era may call for again.

.. Schröder’s rehabilitation also fits in with the traditional patterns of German politics. “Germans on the left and the far right have always had a weak spot for Moscow

.. “If Putin had not invaded Crimea and eastern Ukraine, many Germans would see him as a natural ally in times of transatlantic estrangement.”

.. With global confidence in the U.S. in free-fall due to the Trump administration’s policies, Schröder and other pro-Russian voices in Germany are finding it easier again to defend Putin, said Bierling — and so, too, are many Germans finding it easier to forgive and forget when it comes to their former leader.

Trump’s personal lawyer, Michael Cohen, hires his own lawyer in Russia probe

Michael Cohen, who for years has served as President Trump’s personal attorney, has hired a lawyer of his own to help him navigate the expanding Russia investigation.

.. In January, Cohen was involved in a separate incident that could potentially have drawn the attention of investigators. He has confirmed that he met with a Ukrainian lawmaker at a New York hotel at the urging of a former Trump business associate named Felix Sater. At the meeting, Sater gave Cohen a peace plan that the lawmaker had drawn up for his country that would have paved the way for the lifting of sanctions imposed on Russia after its 2014 military incursion in Ukraine.

.. The New York Times reported that Cohen said he took the plan and left it in the White House office of then national security adviser Michael Flynn.

.. Michael Caputo, a New York-based political operative and radio commentator who served as a senior communications adviser on Trump’s campaign

.. Caputo, who briefly worked for the campaign, was an ally to former campaign chairman Paul Manafort. He lived in Moscow for several years in the 1990s, and briefly held a contract in 2000 with the Russian conglomerate Gazprom Media to improve Russian President Vladimir Putin’s image in the United States.

House Inquiry Turns Attention to Trump Campaign Worker With Russia Ties

Michael Caputo, who served as a communications adviser to the Trump campaign, has been asked by the House committee investigating Russian election meddling to submit to a voluntary interview

.. Mr. Caputo, who lives near Buffalo and spent six months on the Trump team, worked in Russia during the 1990s and came to know Kremlin officials. He also did work in the early 2000s for Gazprom Media, a Russian conglomerate that supported President Vladimir V. Putin.

.. he met his second wife, who is Ukrainian, while working in 2007 on a parliamentary election in Kiev.

.. He is a protégé of Roger J. Stone Jr.

.. “The only time the president and I talked about Russia was in 2013, when he simply asked me in passing what it was like to live there in the context of a dinner conversation,” he wrote.