Sergei Magnitsky

Dominic Raab Excerpts

Wednesday 11th January 2012 Westminster Hall

[Mr Denis MacShane (Rotherham) (Lab)]

It is a great pleasure to initiate this debate under your chairmanship, Dr McCrea. Today I want to deal with the tragedy of a lawyer who worked closely with and for a British company—and its British chairman who is present in Westminster Hall—and who was done to death under the most atrocious circumstances. If a British lawyer working for an overseas firm had been arrested and so mistreated in the UK, all hell would break loose. This tragedy, however, happened in today’s Russia, and my charge is that the British Government have been singularly lax in dealing with the case, and lacking in adequate and necessary measures, not only to obtain justice but to send a clear message that putting to death a lawyer who represents British interests is not cost free. I do not claim a new policy of “advocatus Britannicus sum”, but the idea of civilisation and the rule of law, as well as the clear rules in the European convention on human rights to which Russia is a signatory, provide a special place for lawyers to represent their clients without facing prosecution or persecution unto death.

The details of the tragic death of Sergei Magnitsky are somewhat well known. Mr Magnitsky was the Moscow lawyer of British businessman William Browder. Mr Browder was born American and is the grandson of Earl Browder who was leader of the Communist party in the United States during the 1930s until he fell out with Stalin in 1945. Earl Browder’s grandson decided that capitalism was a better bet than communism, and over a decade beginning in the 1990s he built up the largest investment fund in Russia with billions of dollars of assets. However, not all went well for young Browder when he started publicly complaining about endemic corruption in Russian state companies, and in 2006, President Putin expelled him from Russia as a “threat to national security”. I would like to recommend to the House the remarkable documentary by Ms Norma Percy on the early Putin years. It will be shown on BBC 2 next Thursday and it illustrates the interface between politics, state bureaucracy and business.

Once the Putin regime decides that it does not like a business leader, it does not operate in half measures, and when it decides to turn on someone, it does so in spectacular fashion. After Browder’s expulsion, Putin’s tax police raided his offices in Moscow, seized all his company stamps and seals and stole his investment holding companies. Browder hired a bright young Russian lawyer, Sergei Magnitsky, to try to stop this continuing state-sanctioned crime. Magnitsky investigated all the police actions and discovered that Browder’s companies had not only been stolen but had subsequently been used by the tax police to fraudulently refund from Government coffers the $230 million in taxes that Browder’s firm had paid in the previous year.

Magnitsky did what any lawyer would do on behalf of his client: he filed criminal complaints and testified on the involvement of the tax police in that enormous theft. That was a big mistake. He was subsequently arrested by the same tax police officers against whom he had testified, and blamed for the fraud himself. The scams that the Putinocracy arranges are not just for a few high-up people—everyone gets a cut. To shut him up, Magnitsky was flung into one of the roughest prisons in Russia and essentially held a hostage. Because the Russian state could not get at Mr Browder, who, as a British citizen was now safe in London with his family, they went for his lawyer to send a signal to other firms operating in Russia saying that when the tax police—or anyone else demanding a cut—knock at the door, co-operation is wiser than insisting on the rule of law.

Sergei Magnitsky was brutally treated in prison. He was tortured for 358 days by sleep deprivation, freezing temperatures, the withholding of food and other torments left over from the Stalin era of torturing people whom the Kremlin did not like. After six months of such treatment he became extremely sick and was systematically denied any medical treatment. Eventually, Magnitsky’s beleaguered body began to give way and his condition became critical. Instead of sending him to the emergency room, his jailers put him in an isolation cell and allowed eight riot guards with rubber batons to beat him until he was dead. In November 2009, he was found lying in a pool of his own urine, dead on the cell floor at the age of 37.

Since then, the Russian Government have tried to cover up the cause of Magnitsky’s death, and a network of named officials in the tax, police, public prosecution and prison departments of the Russian state has been identified as part of that cover-up. Many of those involved have bought property abroad at prices that would be impossible on their declared salaries.

None of those facts are secret and they have been reported by journalists in Moscow, as have the details and names of those involved. The names have been listed by US Senators, Congressmen and Congresswomen, and by parliamentarians in some EU member states and in the European Parliament. The Magnitsky affair has also been the subject of a Council of Europe report. I, together with a number of right hon. and hon. Members, as well as Peers, have asked questions in Parliament and sought to highlight this assault on a respected British business, and show the terrible insight that the Magnitsky death gives us into how Russia operates. I had the luck to secure this debate, but that could have happened to any number of interested colleagues who support me on this affair, some of whom are present in the Chamber.

Vasily Aleksanyan was another young lawyer, and former general counsel to Yukos. In 2006, Mr Aleksanyan was arrested as part of the persecution of those involved in Yukos. He rapidly developed serious health conditions due to AIDS-related illnesses, but was denied antiretroviral treatment or chemotherapy in prison. In 2008, the European Court of Human Rights intervened and ordered Russian authorities to release Aleksanyan. The damage done to his body during his detention was too great, however, and he died last year as a direct result of the denial of treatment in jail.

That is the Magnitsky story. We must now turn to the Whitehall story and ask the Minister why the Foreign Office and Home Office have been so lax in taking up the Magnitsky case, and unwilling to take action against the named officials who were involved in theft via the tax system and the crime that Magnitsky sought to reveal. Will the Minister explain why some of the principals involved have been allowed to enter the UK without let or hindrance? Lieutenant Colonel Artem Kuznetsov from the Russian Interior Ministry was named in Magnitsky’s testimony as having orchestrated the theft of the Hermitage fund’s investment companies. Kuznetsov was also accused of perpetrating the $230 million tax fraud, as well as Magnitsky’s false arrest and persecution in detention. Public records—let me stress that—show that shortly after the $230 million was paid from the Russian Treasury, Kuznetsov’s family acquired $3 million worth of high-end apartments in Moscow, land plots outside the city and several luxury cars. Kuznetsov travelled to the UK twice in 2006.

Major Pavel Karpov, also from the Russian Interior Ministry, was named by Magnitsky as a close accomplice of Kuznetsov. Karpov initiated the criminal case against Mr Magnitsky that was used as a pretext for his false arrest. Public records in Russia—again, I stress that—show that Karpov’s family acquired $1.3 million in real estate assets and luxury cars following the completion of the fraud. Mr Karpov travelled to the UK four times between 2006 and 2007.

Dmitry Klyuev is the owner of Universal Savings bank through which the $230 million proceeds of the fraud were laundered. He was previously involved in a number of other tax-refund frauds, and in 2006 was convicted of a $1.6 billion fraud relating to the attempted theft of shares from Mikhailovsky GOK, a Russian iron ore company. Mr Klyuev also travelled to the United Kingdom at least five times in 2008. As I have said, all these names are on the record in Russia and on Capitol hill in Washington.

The following Government officials also played a role in the tax fraud that Magnitsky uncovered, his subsequent arrest and imprisonment, the persecution of Hermitage lawyers and executives, Magnitsky’s continued detention, the denial of medical care, torture, the denial of fair hearings, and finally his death in custody and the subsequent cover up: from the courts service, Judge Yelena Stashina, Judge Alexei Krivoruchko, Olga Egorova; from the Interior Ministry, Mr Oleg Silchenko, Oleg Urzhumtsev, Alexei Anichin, Oleg Logunov, Boris Kibis, General Major Tatiana Gerasimova; from the FSB—the Russian secret service and the successor to the KGB—Mr Viktor Voronin; from the tax offices, Olga Stepanova and Elena Khimina; from the prison services, Dmitri Komnov, Fikhet Tagiev and Yuri Kalinin; and from the General Prosecutor’s Office, Andrey Pechegin.

I ask the Minister to agree that those people should now be banned from entering the UK and their names circulated via Interpol and Europol. We need to sharpen up our diplomatic tools by declaring that the functionaries linked to Magnitsky’s death are unwelcome as visitors in Britain, thus copying what the US State Department has done under pressure from the US Congress.

[Mr Dominic Raab (Esher and Walton) (Con)]

rose—

[Chris Bryant (Rhondda) (Lab)]

rose—

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[Mr MacShane]

I think that I may just have hinted at that.

[Mr Raab]

I congratulate the right hon. Gentleman on securing the debate. Does he agree that in addition to highlighting the tragic case before us, it is time for a British equivalent of the US Sergei Magnitsky Rule of Law Accountability Act, which would hold to account more generically foreign officials responsible for grotesque human rights abuses, through travel bans and asset freezes, and also that, as in the US, this a matter not just for the Executive, but for Members of this House and for Parliament?

[Mr MacShane]

I would support that. Perhaps some right hon. and hon. Members present might combine to ask the Backbench Business Committee for a longer debate, which might allow a slight pause for breath and more development of some of these themes. In particular, it would show the Russian authorities that this is a cross-party affair, with support from a considerable number of Members of both Houses.

--- Later in debate ---

[Mr Bellingham]

I thank my hon. Friend for making that point. I agree with what she says, and we will ensure that that is taken up at the highest level.

In addition to the Magnitsky case, it is important that the Russian Government fully investigate the unresolved murders of journalists and human rights defenders. We remain concerned at the lack of progress in prosecuting those responsible for the 2009 murder of Natalya Estemirova. The murder of Russian journalist Anna Politkovskaya remains one of the most worrying cases of recent years. More than five years after her tragic death, the case still remains to be concluded. In October, Russian prosecutors announced new charges against suspects allegedly involved in organising her murder. The Prime Minister raised this case with President Medvedev during his recent visit to Moscow, calling on the Russian authorities to take further steps to bring all perpetrators to justice. There is a low success rate in investigating and prosecuting these crimes, thus perpetuating the perception of impunity, which undermines freedom of expression and human rights in Russia.

[Mr Raab]

I thank the Minister for giving way again. He is eloquently making the case for the kind of legislation that the US wants to enact. He mentioned the Bill that has gone through Congress. It looks likely to become law and is unlikely to be vetoed by the President. Given the evidence that he has adduced here before us today, would he be open to that kind of Bill being introduced in the House of Commons?

[Mr Bellingham]

If that Bill gets through Congress, we will certainly look at it very carefully. We will look at whether there are any appropriate lessons for this country, and we will consult parliamentary colleagues from all parts of the House. I cannot give any guarantees, but we need to watch very carefully to see whether the Bill becomes law in the US.

In conclusion, I hope that what I have covered today illustrates the Government’s concern and action, both on the wider issue of human rights in Russia and on the specific case of ensuring justice for Sergei Magnitsky. As my right hon. Friend the Foreign Secretary said:

“Human rights are part of our national DNA and will be woven deeply into the decision-making processes of our foreign policy at every stage”.

That applies to our dealings with Russia as much as with any country. We will continue to engage Russia on human rights through bilateral contacts, including our annual human rights dialogue, which will take place in London this year—in the summer, we hope—as well as through multilateral channels, such as the EU, the UN and the Council of Europe.

I thank the right hon. Member for Rotherham for bringing Parliament’s attention to this issue and giving me the chance to explain the Government’s position. We will continue to push for the respect of human rights and the rule of law in Russia and achieving justice for Sergei Magnitsky.