By Manoel Chavanne
Sergei Magnitsky
“Red Notice: A True Story of High Finance, Murder, and One Man's Fight for Justice” is an absolute page-turner, the writing is outstanding, the story is fascinating and Bill Browder's eloquence as well as the way he organizes his chapters make it very hard to put the book down once you've started it. Credit to my lifelong friend Nicolas Jaeger for recommending it to me.
A fun anecdote Bill Browder mentions in this bestseller is that in the 1930s his grandfather was the last Communist Party candidate for the US presidency. Naturally, he therefore decided to become the first capitalist in Russia after the collapse of the USSR. Thus, after training in the UK and a relatively quick stint in Poland to practice investing in a post-Soviet nation he moved to Moscow where he started his own investment fund which grew to manage a whooping $4.5 billion of assets. In 1997 it even was the best performing investment fund in the world with an astonishing annual return rate of 238%. For those not good at math this means multiplying by almost 3.4 the amount invested in just twelve months so if you gave Browder $100 on January 1st you'd have $338 a year later.
Bill Browder begins the book by describing how he was unexpectedly banned from Russia after having lived there for many years. He flew back to Moscow from the UK, where he went to visit his son, and upon landing was questioned in a special room before hearing that his visa wasn't valid anymore, subsequently being deported out of the country and declared a threat to Russian national security. What he didn't know yet was that he would turn out to be the lucky one as his tax advisor, Sergei Magnistsky, would end up jailed and murdered in a more brutal way than what happened to Alexei Navalny last week. Although to be fair we may never know exactly what happened to either of them, as I'm sure we're all aware statements coming from Russian authorities are to be taken with a massive pinch of salt.
This fantastic memoir recounts how the author went from being the grandson of an American Communist politician to maybe the most efficient capitalist in the post-soviet world and how his main investment strategy in Russia was to expose oligarchs who abused shareholders, getting the authorities involved and eventually pocketing profits once the companies were reevaluated. This worked very well until Browder's fund crossed the wrong people, those on the side of the government. Sergei Magnistsky was the key character of this part of the story. He was born in Odessa in 1972 and grew up there until his family moved to Southern Russia where he stayed until he moved to Moscow at 18 to attend Plekhanov University. He got married to a lawyer he had met in high school and had two sons with her before regrettably facing a tragic death.
As a Ukrainian born tax specialist he was the one to uncover fraud on a massive scale (hundreds of millions of dollars), disclosed it to Browder and reported it to the authorities but instead of treating him like whistle blowers should be treated Putin's regime put him in jail. There, he was tortured for a year before being beaten to death by eight prison guards. Magnitsky truly is the prodigious hero of this story as he wanted to do the right thing by exposing crooks, refused to leave Russia even though he understood the risks and eventually paid the ultimate price for his commitment to and belief in the rule of law. His biggest mistake was trusting Russian authorities.
This infuriating murder led Browder to launch a campaign in the West to ensure those involved in this assassination got punished. This part of the book is at least as captivating as the ones I've just covered as the author engages in a quest to convince lawmakers to create such a law, which is now known in the United States of America as the Magnistsky Act. If some of you find that the name Magnitsky rings a bell it's most certainly due to this law which is named after him.
The Magnitsky Act (US) and Magnistsky Legislation (EU, UK, Canada and Australia) are laws that were passed in the aforementioned parliaments enabling these jurisdictions to go after individual Russians for their involvement with their government when it engages in illegal or criminal actions, such as the annexation of Crimea or the invasion of Ukraine. Western governments can use Magnitsky legislation to sanction foreign individuals who violated human rights or have been involved in significant corruption. Said individuals can be banned from entering the US and can see their assets frozen or seized. These were primarily put in place to go after Russian oligarchs or those who helped the Russian government commit human rights abuses or corruption but they have since been used against dozens of officials coming from Venezuela, Saudi Arabia, Sudan and Burma among others.
Countries having passed so-called Magnitsky legislation.
There was a follow-up to Red Notice, “Freezing Order: A True Story of Money Laundering, Murder, and Surviving Vladimir Putin's Wrath”, which I also devoured and certainly also qualifies as a page-turner but isn't as significant as Red Notice in terms of geopolitical importance. Browder truly is a fantastic author and his rightful fight for justice deserves all the publicity it can get.