Few people would be willing to take on authoritarian Russian President Vladimir Putin, but hedge fund exec Bill Browder has done just that.
Capitalist to campaigner
Browder never shared his family's political allegiances. Despite being the grandson of the American Communist Party's former general secretary, he opted to pursue the capitalist's path instead: after graduating from Stanford business school the same year the Berlin Wall fell, he upped sticks to London with one clear aim in mind – to make plenty of dosh.
After securing a position with the Boston Consulting Group, Browder turned his attention to the crumbling communist bloc, and realised that there was money to be made in the region's crop of privatisations. Deciding that it was high time he set out on his own, Browder founded Hermitage Capital Management in 1996 and decamped to Moscow.
There he steered Hermitage's success by pouring a nest egg of $25 million into Mother Russia. Within a short period, the fund saw returns of $100 million, and it soon became the largest foreign investor in the country. But Browder didn't funnel these investments in quietly. Hermitage began to use its stake in some of Russia's prominent companies (like gas maestro Gazprom) to pressurise management to stamp out corporate crime.
Exposing corruption within Russia's business elite was a dangerous move. In 2006, the Kremlin blacklisted Browder, barred his re-entry and labelled him a 'threat to national security'. A year later, Hermitage's Moscow offices were raided; computers and an array of official company documents were taken. With this information, Hermitage's assets were misappropriated via a tax fraud, which placed $230 million into Russian officials' pockets. It later transpired that they'd spent the money on the likes of Range Rovers and properties in Moscow and Dubai.
The death of Sergei Magnitsky
Hermitage's tax lawyer, Sergei Magnitsky, uncovered the fraud. Browder offered to support Magnitsky if he moved to London, but, believing in Russia's justice system, he decided to stay and alert the authorities to what had happened. Magnitsky was then charged with tax evasion and held in a pretrial detention centre for 11 months. After making 450 written complaints about conditions within the centre, Magnitsky – who was suffering from pancreatitis – was taken to the hospital wing and beaten to death.
Upon hearing the news of Magnitsky's death, Browder took action. He travelled to Washington DC, and there convinced reluctant White House officials to pass the Magnitsky Bill. Obama signed it in December 2012, despite fears of rocking Russian relations just after they'd been 'reset'. The new law placed those suspected of involvement in Magnitsky's death on a visa ban list, and also froze their assets (a selection of countries followed suit, and Browder is currently campaigning to have similar legislation passed across the European Union).
Putin responded swiftly to the US' actions. He passed a law preventing Americans from adopting Russian children, and banned certain US officials from entering the country. Both Browder and Magnitsky were put on trial for tax evasion, marking the first time Russia had tried a defendant posthumously. Interpol was asked by Russia to locate and return Browder to Moscow, but these extradition requests were definitively denied in 2013, due to their 'predominantly political'nature. Browder was subsequently convicted in absentia and sentenced to nine years in prison; ridiculously, Magnitsky's sentence was announced to an empty barred cage in the court.
In 2016, Browder penned a letter to former Prime Minister David Cameron, urging him to pass a law similar to the Magnitsky Bill in response to the poisoning of ex-Russian spy Alexander Litvinenko. Browder continues to work as a human rights activist in the wake of Magnitsky's murder.
Peters & Peters' involvement
Peters & Petershas been working with Hermitage Capital and Bill Browder for a decade. The main thing the firm has done is help Hermitage stop the Russian government from gaining the UK's legal assistance for its politically motivated investigations into the company. It's also helped thwart attempts to begin extradition proceedings against Browder, and acted for Hermitage during the inquest into the 2012 death of Alexander Perepilichny, who was allegedly poisoned by the Russian security services.
Peters & Petersis clearly very proud of its relationship with Browder and Hermitage – in November 2015 it sponsored the Sergei Magnitsky Human Rights Awardsgiven to a number of journalists, politicians and organisations on the anniversary of Magnitsky's death.
In February 2015, Browder published his account of what happened to Magnitsky in Red Notice: How I Became Putin's No 1 Enemy.