The relationship between the United States and the Russian Federation today is tense with disagreements, the source of which lie in U.S. lawmakers granting international satisfaction to a fugitive criminal accused of tax fraud in Russia, a former U.S. citizen, William Browder, who in 1998 renounced American citizenship for tax reasons.
In December 2012, after a major, three-year lobbying campaign, the
United States adopted the Sergei Magnitsky Rule of Law Accountability
Act, which laid out the in fact nonexistent story of a "lawyer" Sergey
Magnitsky, who allegedly exposed corruption crimes and embezzlement
from the Russian treasury, for which he was arrested, tortured and beaten,
leading to his death in November 2009.
This law was in essence the start of a new round of the Cold War
between the United States and Russia, putting on the scales the interests of a
group of fraudsters one on side, and interstate relations on the other.
The foundation of the law is the story of Sergey Magnitsky, which is
horrifying in the depth of its lie, from the beginning to the end, and which no
one in the United States ever verified for its truthfulness or existence.
According to open sources, the lobbying in the decision against
Russia began in 2006, immediately after Browder was banned from entering
Russia. Several senators and public figures were immediately involved. In
2008, Browder officially announced a lobbying campaign on the questions
between Hermitage Capital and Russia. And after the death of Magnitsky
(coinciding with the need to focus attention on the problems of Hermitage),
the lobbying campaign became known as the Magnitsky Act.
An internal investigation into the reasons for providing political
support to Browder in the United States, it was established that from the
very beginning of the activities of the Hermitage fund in Russia, led by its
main consultant, Browder, the largest client and investor was the group of
companies of the Ziff brothers (three brothers – Dick, Robert, Daniel). The
Ziff brothers are billionaires from New York with serious ties in
Washington.
According to information we have, the Ziff brothers took part in
financing both Obama election campaigns, and the American press call them
"the main sponsor of the Democrats". It cannot be ruled out that they took
part in financing the campaign of Hillary Clinton.
The union of the Ziff brothers with Hermitage fund and Browder
began after the death of the strategic owner and main investor in the
Hermitage Fund, Edmond Safra. Since the end of 1999, Browder’s largest
client became the company Ziff Brothers Investments, which began
aggressively buying Gazprom stock through a scheme to bypass a Russian
legislative ban on foreign companies purchasing this stock on the internal
market.
The applied share purchase scheme not only allowed buying the
shares at a price 1.5 times lower than through the American depository
receipts, but also allowed investors and their advisers to avoid government
control and monitoring of capital sources, its movement and taxation in the
United States and Russia corresponding to the investment activities.
In the period of late 1999 to 2004, two companies – Speedwagon
Investments 1 and 2, registered in New York, and owned by the said U.S.
investors, acting through three Cypriot companies, Giggs Enterprises
Limited, Zhoda Limited, Peninsular Heights Limited illegally acquired more
than 133 million Gazprom shares in the amount exceeding $80 million in the
name of the Russian companies Kameya, Lor, Excalibur, Sterling
Investments.
Once Browder’s activities drew the attention of the Russian law
enforcement authorities, and he was not allowed any more to visit Russia on
a tourist visa, in January 2006 all the assets controlled by Ziff Brothers
Investments were removed from the jurisdiction of the Russian Federation.
According to available information, in 2006 the American owners of
the chain of companies mentioned above gained an income of over $ 800
million, including 66 million shares of Gazprom received as dividends.
According to preliminary estimates, the damage to the Russian budget
in the form of unpaid taxes from these activities exceeded 1 billion rubles.
Also, no information was found in any open sources of tax and
investment (stock exchange) registries of the United States about a
declaration by those companies of their investment activities abroad and
their payment of taxes in the amount of 35%, which may indicate a largescale
tax evasion in the United States, as well as of legalization of criminal
proceeds from deals falling under U.S. laws against corruption abroad.
Realizing the realistic threat of exposure by both the Russian and U.S.
law enforcement authorities, as well as deceived or misled clients and
investors, Browder accomplished an egregious scheme of embezzlement of
funds from the Russian treasury, the main element of it being to create an
alibi of him having nothing to do with the embezzlement, by way of
simulation of theft of three Russian portfolio companies from the Hermitage
Fund.
With a goal of shifting the attention of law enforcement bodies and
the public from the illegal activities of the largest American investors on the
territory of Russia, a major fraud was planned and executed through the
companies that were part of the Hermitage Fund, managed by another
banking structure – HSBC. The story of theft from the budget of 5.4 billion
rubles that became known as the Magnitsky case in fact had nothing to do
with the real facts.
Browder, moving from country to country, enlists the support of many
leading politicians who lobby his interests, repeating the same notorious lie
under oath in the European Parliament and the U.S. Congress. Manipulating
the grief of relatives of Magnitsky, Browder presents them as a human shield
to distract attention from the details of his crime.
However, immediately after the Magnitsky Act was passed,
Browder’s group faced the fact that its realization – namely, imposing direct
sanctions on specific individuals — was not as simple as it seemed to be at
first. A push was needed in Europe and the United States.
To bolster his argument, Browder starts his political processions
through Europe, and in the United States initiates a court case (in the
Southern District of New York) against the Prevezon group of companies,
owned by Russian businessman Denis Katsyv, who had never been
mentioned in connection with the Magnitsky case before.
In the end, no the European countries passed a law analogous to that
in the United States, and PACE only passed a resolution based on the report
of Andreas Gross, entirely re-written from the false story so often distributed
by Browder’s group.
But in the course of collecting evidence in the civil case in the United
States, Browder was questioned and his testimony clearly differs from the
information he reported both in the foreign affairs committee in the House of
Representatives before the adoption of the Magnitsky Act, and in all his
public statements. And Browder for a long time avoided testifying, until he
was forced to testify by Judge Griesa.
The civil case against Katsyv was suspended in view of Browder’s
motion to dismiss American lawyers after they said in court that they had
evidence that the person who had a motive and opportunity to steal $230
million from the Russian budget was Browder himself, and his employees
(the hearing was scheduled June 9, and Preveson’s lawyer will be Michael
Mukasey, a former U.S. Attorney General 2006-2009, and a retired judge.)
Browder, realizing that sooner or later his lies would come out in a
jury trial in New York, used the period of the suspension in the case to
intensify his efforts to globalize his false story and strengthen his alibi. With
the help of Senator Cardin, his long-time collaborator, he has the Global
Magnitsky Act introduced in the Senate last December, and in April it was
forwarded to the foreign affairs committee in the House of Representatives.
Browder’s plan is simple: to place the Global Magnitsky Act on the
table of the new President of the United States, to prevent the new
administration from reviewing the interstate relations between the United
States and Russia, so diligently antagonized at the instigation of Browder
and others interested in this.
But in the course of its consideration in the foreign affairs committee
last month, for the first time in Congress, the story of the Magnitsky case
was questioned, and its real initiator, William Browder, was called a crook
who wound around his finger the whole Congress. (The Republican Dana
Rohrabacher). Rohrabacher introduced an amendment to exclude the name
of Magnitsky from the U.S. legislation and proposed to check the objectivity
of the whole story underlying the 2012 law. However, politicized and
biased, and simply reluctant to sort out this complicated story, most
members of the committee have prevented an objective analysis.
Nevertheless, though the foreign affairs committee passed the Cardin
law for subsequent approval in other House committees, the arguments
brought forward during the hearing by Mr. Rohrabacher, and supported by
several other members of the committee, brought a reaction.
It is expected that on June 14-15, 2016, the foreign affairs committee
will hold open hearings with witnesses from the sides of both Browder and
his opponents (lawyers, journalists, human rights activists).
Browder’s Russian citizen opponents will show Congressmen the facts
and evidence of Browder’s false testimony earlier, in the same committee in
2012, after which the law was passed that became a basis for open
confrontation between our countries, complicating relations on all key
geopolitical issues and leading to the ban on Americans adopting Russian
children.
It is necessary to support in the foreign affairs committee normal
hearings of this urgent issue.
Now there is a unique opportunity to demonstrate in Congress the
false version of events set forth by Browder, and to show his true motives
for lobbying this antagonistic law, his personal relationship to the facts, and
to prevent politicians from earning dividends on fomenting a cold war with
Russia.
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