By Tom Baker / Japan News Staff WriterRed Notice: How I Became Putin’s No. 1 Enemy
By Bill Browder
“Bill Browder is a champion of anti-corruption in #Russia.” So declared U.S. Sen. John McCain on Twitter on Oct. 23.
Who is Bill Browder? And why did McCain tweet about him?
A good place to find answers is “Red Notice.” It begins as Browder’s memoir about founding an investment entity called the Hermitage Fund during Russia’s turn away from communism. His glittering tale of champagne and yachts becomes darker as he begins to expose corruption among Russia’s elite. It reaches a nadir when his friend, whistle-blowing lawyer Sergei Magnitsky, is arrested, imprisoned and killed.
Magnitsky was beaten to death on Nov. 16, 2009. The British businessman’s response to his friend’s murder continues to affect Russia’s relations with the world today.
These were complicated events, but “Red Notice” explains them well. The writing is clear and fast-paced, and the story is engrossing.
For example, Browder explains that privatization in Russia in the early 1990s included issuing each of the nation’s 150 million citizens a voucher for stock in former state enterprises. The vouchers represented 30 percent of the value of all Russian companies but were trading so cheaply that Browder calculated “the valuation of the entire Russian economy was only $10 billion! That was one sixth the value of Wal-Mart!”
Realizing this was too low, he began buying vouchers and made massive profits when stock prices inevitably rose.
This era also saw the rise of Russia’s billionaire oligarchs, at least some of whom were not satisfied with huge profits made legally. They made even more money by breaking the rules — and Browder made money by exposing them. After the Hermitage Fund helped find evidence that the CEO of oil company Gazprom had transferred enormous assets to his own relatives, Russian President Vladimir Putin had the CEO ousted in 2001. The government vowed to recover the assets, and Gazprom stock, some of which Hermitage owned, “went up 134 percent in one day.”
Hermitage revealed corruption at other companies, and Putin cracked down on them in turn. Browder writes that “for a while our interests coincided.” As a new leader, Putin used anticorruption campaigns as weapons against his wealthy rivals. But once he consolidated power — and, Browder presumes, secured a cut of everything the oligarchs were taking in — he became less positive about Browder’s reform activities.
Eventually, Browder was expelled from Russia and his friend Magnitsky was locked up in horrific conditions after trying to expose a multimillion-dollar tax fraud perpetrated by corrupt government officials.
After Magnitsky’s death, Browder became a human rights activist, convincing several U.S. politicians (including McCain) to bring about a 2012 law known as the Magnitsky Act, which “sanctions Russian officials who were responsible for Sergei’s detention, torture and murder, as well as other Russian human rights abusers.”
In retaliation, Russia barred Americans from adopting Russian orphans, setting off a dispute that has yet to be settled. By the end of this book, originally published in 2015, Russia had made two international attempts to have Browder arrested. Last month, they made the fifth such attempt after Canada passed its own Magnitsky law. And that led to McCain’s tweet.
“Red Notice” is a compelling book that will help you understand what is going on when you see Magnitsky laws, Russian adoptions or Russian corruption mentioned in the news. Or on Twitter.
Where to Read
In a safe house.