Monday

13th Jul 2020

Stolen Russian tax money is in EU banks, US sleuth says

  • View of Kremlin: the 37-year-old Magnitsky left behind his wife and two children. His mother is too scared to speak to press (Photo: Wikipedia)

People responsible for the death of Russian lawyer Sergey Magnitsky have salted away stolen money in EU bank accounts, Magnitsky's former employer has claimed.

Bill Browder, the US-born head of the UK investment firm, Hermitage Capital Management, and five of his staff have spent the past year hunting down the assets of Russian officials exposed in a €175 million tax fraud by Magnitsky shortly before he was jailed and murdered in his cell.

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Browder scored a victory last week when Swiss authorities froze a number of accounts in the Credit Suisse bank following evidence brought to light by Hermiatge and broadcast on YouTube.

The YouTube clip shows how Russian tax official Olga Stepanova, her husband, Vladlen Stepanov, and two associates used an offshore firm in Cyprus, Arivust Holdings, and in the British Virgin Islands, Aikate Properties, as well as Credit Suisse, to buy multi-million euro properties in Dubai, Russia and Montengro.

Stepanova is one of 60 people, including officials in the Russian interior ministry and in the FSB secret service, believed by Browder to be involved in the conspiracy to silence Magnitsky.

"We have identified assets in a number of EU countries where they travel and have assets, and bank accounts. Ultimately we want to see the same results as we have achieved in Swizterland - assets frozen and travel curtailed," Browder told this website.

EU diplomats have asked Russian counterparts time and again to look into the case during human rights consultations - regular talks held twice each year behind closed doors in Brussels.

They never got real answers. But in a sign that Browder's campaign is making an impact on the EU institutions, officials last week took the unusual step of making a public statement about the content of the last round of talks.

"The Russian side ... informed that the formal report from the Investigative Committee should be completed over the next months. The Presidential Human Rights Council's working group should also be completing its independent inquiry into this case soon," the European External Action Service said. "The EU ... trusts that the Russian authorities will ensure that those responsible for the death of Sergey Magnitsky be brought to justice."

Commenting on the EU move, Browder said: "It shows how exceptional the Magnitsky case is and how it has become the most emblematic symbol of corruption and impunity in Russia."

For its part, Russia reacted to the YouTube revelations by issuing an arrest warrant against Hermitage's London-based lawyer Ivan Cherkasov and by again threatening to issue a warrant against Browder.

"The Russian police officers involved in the fraud have been threatening to issue a retaliatory arrest warrant against me for three years [dating back to Magnitsky's initial revelations], but it doesn't worry me. No law-abiding country in the world would honour such a warrant," Browder told this website.

"The more they target whistle-blowers, the more it hardens the position of the West."

On Friday (6 May), Russian human rights groups hailed the jailing of an ultra-nationalist for the murder in Moscow in 2009 of human rights lawyer Stanislav Markelov and a trainee reporter, Anastasiya Baburova.

The vast majority of high-profile political killings in Russia in recent years - such as journalist Anna Politkovskaya and human rights campaigner Natalia Estemirova - continue to go unpunished, however.

Russian interior ministry spokeswoman Irina Dudukina has said the state cannot trace any of the funds in the Magnitsky-exposed tax fraud because a truck containing the relevant documents "exploded."

Russia's mission to the EU was contacted for a reaction to the latest developments but declined to comment.

France threatens Switzerland on tax evasion

French leader Nicolas Sarkozy has promised to make Switzerland into an international pariah unless it stops helping EU tax payers hide money. But EU countries have a poor track record of cracking down on high-level cheats.

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