Son of Senior Russian Government Official to Pay US$5.9 Million to the US Treasury in the First Money Laundering Action Linked to Magnitsky Case
May 13, 2017
Press Release
For Immediate Distribution
Son of Senior Russian Government Official to Pay US$5.9 Million to the US Treasury in the First Money Laundering Action Linked to Magnitsky Case
13 May 2017 – Denis Katsyv, the son of a senior Russian government official, will pay US$5.9 million to the US Treasury in the first case in the West linked to the $230m proceeds from the Russian fraud that Sergei Magnitsky exposed and was eventually killed over.
“This is a huge victory in our campaign for justice for Sergei Magnitsky. The amount to be paid is more than triple the amount of money laundering proceeds that was thus far identified by the US government in New York connected to Prevezon,” said William Browder, leader of the global Magnitsky Justice campaign.
“This sends a clear message to the people who received that money that it’s not safe in the West and will be seized. I believe that this case will give the green light to other countries to follow suit,” said William Browder, who described the Magnitsky justice campaign in a New York Times best-seller, “Red Notice: A True Story of High Finance, Murder, and One Man’s Fight for Justice.”
The stipulation to pay US$5.9 million to the US Treasury has been signed on 12 May 2017 by Russian national Denis Katsyv, in his capacity as owner of Cyprus-based Prevezon Holdings and a web of other offshore companies, including IKR, Martash Holdings, Ferencoi Investments Ltd and as “legal representative” of Kolevins Ltd. The stipulation will have to be approved by the US court to go into effect.
After US$230 million had been stolen by a group of Russian officials and organized criminals, a wide “Byzantine” network of shell companies and conduit accounts was used to launder the stolen proceeds, some of which have been traced by the US Department of Justice to the real estate properties in New York purchased by the Katsyv-owned Cypriot company, Prevezon Holdings.
In 2013, the US Department of Justice froze Prevezon’s assets, and the case was scheduled to go to trial on Monday, 15 May 2017. Denis Katsyv tried to dismiss the US Justice Department’s action on the eve of the trial, challenging the basis for the money laundering allegations against him.
In an opinion issued five days before the trial, on 10 May 2017, United States District Judge William Pauley III dismissed Prevezon’s motion.
The court found sufficient basis to try the case on four different wrong-doings identified by the US Department of Justice, including (1) fraud against HSBC, (2) transportation of stolen property, (3) bribery of a Russian official, and (4) money laundering.
In its 10 May 2017 opinion, the US court also upheld the US Justice Department’s money tracing analysis in relation to the US$230 million fraud proceeds. The court found that the US Government presented evidence that “the money laundering scheme was designed to conceal the illegal nature and source of the $1.9 million [traced to Prevezon] at issue,” including that “some of the accounts of the conduit entities were opened a few months before the transfers at issue, at the same bank on the same day;” two intermediary accounts had “strikingly similar pattern[s] of activity in their bank accounts;” “the majority of their incoming transfers came from three senders, one of whom routed money from an account at a bank designated by the U.S. Treasury as money laundering concern;” “a total of five accounts reflecting similar patterns of activity were repeatedly accessed from the same IP address,” and that “dividing proceeds to avoid detection is a hallmark of money laundering.”
Two days later Prevezon signed the stipulation to pay US$5.9 million to settle the US Justice Department’s money laundering action and avoid going to trial.
Sergei Magnitsky, a Russian lawyer who uncovered the massive corruption perpetrated systematically by Russian officials and organized criminals, including the theft of US$230 million in 2007, was tortured and killed in Russian police custody after exposing it. The Russian government prosecuted Sergei Magnitsky posthumously and exonerated all officials involved in the US$230 million fraud.
Sergei Magnitsky’s colleagues have been able to continue his investigation, and uncovered the vast money laundering network spanning multiple jurisdictions and hundreds of conduit accounts.
Denis Katsyv’s and Prevezon’s accounts remain subject to a criminal money laundering investigation in Switzerland conducted by the Swiss Attorney General. Switzerland was the first country to act in relation to the US$230 million fraud proceeds going to Prevezon accounts imposing account freeze in 2012.
For more information, please contact:
Justice for Sergei Magnitsky
e-mail: info@lawandorderinrussia.org
twitter.com/Billbrowder
The Queen of England Gives Final Approval to the Magnitsky Sanctions Law in the UK
April 28, 2017
Press Release
For Immediate Distribution
The Queen of England Gives Final Approval to the Magnitsky Sanctions Law in the UK
28 April 2017 – The Queen of England has given the royal assent to the UK Magnitsky sanctions provision contained in the Criminal Finances Bill passed in the UK parliament. The UK Magnitsky sanctions provision has now become law. It gives the British government the power to seize assets of gross human rights violators.
“The royal approval of the UK Magnitsky act represents a significant progress in the globalization of the Magnitsky sanctions regime against kleptocrats and human rights abusers,” said William Browder, leader of the global Magnitsky Justice Campaign and author of “Red Notice: How I Became Putin’s No 1 Enemy.”
“This effort is the result of seven years of advocacy in the name of Sergei Magnitsky who uncovered and testified about the US$230 million corruption scheme perpetrated by Russian officials and was killed for his whistle-blowing,” said William Browder.
The Magnitsky sanctions provision has previously received approval from both houses of the UK parliament.
The UK Magnitsky legislation protects those who “have sought to expose the illegal activity carried out by a public official or a person acting in an official capacity, or to obtain, exercise, defend or promote human rights and fundamental freedoms.” (full text here).
The UK Magnitsky sanctions legislation stipulates gross human rights abuse as unlawful conduct.
Sergei Magnitsky was a Russian lawyer who uncovered the massive corruption perpetrated systematically by Russian officials and organized criminals, which included thefts from the Russian treasury, including the theft of US$230 million in 2007. Instead of pursuing the officials who approved the thefts, the Russian government arrested Sergei Magnitsky and put him in pre-trial detention, where he was tortured for 358 days and killed at the age of 37. All officials implicated in his torture and the multi-million dollar thefts have been exonerated.
For more information, please contact:
Justice for Sergei Magnitsky
e-mail: info@lawandorderinrussia.org
twitter.com/Billbrowder
Magnitsky Sanctions Legislation Introduced in the Lithuanian Parliament
April 20, 2017
Press Release
For Immediate Distribution
Magnitsky Sanctions Legislation Introduced in the Lithuanian Parliament
20 April 2017 – Today, Magnitsky sanctions legislation has been introduced in the Lithuanian Parliament.
The Lithuania’s Magnitsky bill refuses entry to Lithuania to persons who have been involved in human rights abuses, money laundering and corruption.
The bill is the initiative of Gabrielius Landsbergis, MP, Chairman of the Homeland Union-Lithuanian Christian Democrats, and is co-sponsored by twenty other members of the Lithuanian Parliament from all major political groups, including Farmers and Greens, Social Democrats, Homeland Union -Christian Democrats, and the Liberals.
Mr Landsbergis said of the Magnitsky initiative:
“The impunity of foreign persons who perpetrate gross human rights violations, participate in money laundering or corruption should not be tolerated just because the justice system and the rule of law is corrupted in an undemocratic country, as the Magnitsky case has shown. It is important to let perpetrators know in advance that such crimes are not tolerated in Lithuania and that such people will not be allowed to enter our country. Our Magnitsky law is universal, just as human rights themselves.”
“I hope that more democratic countries in Europe will follow suit, and that finally we will have EU-level sanctions in this regard, just as the European Parliament has called for,” said Mr Landsbergis.
The proposed Magnitsky legislation seeks to amend Article 133 of the Lithuanian Law on the Legal Status of Aliens.
It would ban an alien from entering the Republic of Lithuania if there is information or good reason to believe that the person participated in or contributed to large-scale corruption or money laundering, or to violations of human rights, which resulted in the death or serious injury of a person, the unfounded conviction of a person based on political motives, or other serious negative consequences.
The Magnitsky legislation is proposed as a result of the case of Sergei Magnitsky in Russia which has become emblematic of the human rights abuse for the financial benefit of corrupt government officials.
In 2008, Sergei Magnitsky uncovered a $230 million tax theft committed by Russian state officials, but when he implicated the officials involved, he himself was arrested, unjustly imprisoned for 358 days, tortured and beaten to death in detention center on November 16th, 2009 at the age of 37, leaving a wife and two children.
The Campaign for Justice for Sergei Magnitsky has been vigorously pursued by his former colleagues, which has led to the US Congress passing the Sergei Magnitsky Rule of Accountability Act in 2012, and the Global Magnitsky Human Rights Accountability Act in 2016.
In December 2016, the Estonian Parliament unanimously passed its own Magnitsky Law denying entry to Estonia to human rights abusers.
This year, the UK Parliament has begun consideration of the Magnitsky legislation imposing the financial sanction on human rights abusers in the form of assets forfeiture. The UK’s Magnitsky assets sanctions legislation has been passed by the House of Commons and is being currently considered in the House of Lords.
Main sponsor of the Lithuanian Magnitsky bill:
– Gabrielius Landsbergis, Leader of TS-LKD Group in Seimas, Chairman of TS-LKD, he also served as Member of the European Parliament in the European People’s Party.
Among other co-sponsors of the Lithuanian Magnitsky bill:
– Mr Vytautas Bakas, Lithuania’s Farmers and Greens Union, Chair of the National Security and Defence Committee, member of the Anti-Corruption Commission.
– Mr Juozas Bernatonis, Social Democrats party, Chair of the of Foreign Affairs Committee, he also served as chief adviser under Prime Minister Kirkilas and as a Ministry of Extraordinary and Plenipotentiary Ambassador to the Republic of Estonia.
– Ms Aušrinė Armonaitė, Liberals Movement party, member of the Foreign Affairs Committee.
The events of the Magnitsky case are described in the international best-seller “Red Notice” by William Browder and in a series of Magnitsky justice campaign videos on the YouTube channel, “Russian Untouchables.”
For more information, please contact:
Justice for Sergei Magnitsky
44 207 440 1777
billbrowder.com
twitter.com/Billbrowder
Canadian Parliament Formally Recommends the Canadian Government Adopt Magnitsky Sanctions Against Human Rights Violators
April 7, 2017
Press Release
For Immediate Distribution
Canadian Parliament Formally Recommends the Canadian Government Adopt Magnitsky Sanctions Against Human Rights Violators
6 April 2017 – Today, the Canadian Parliament’s Standing Committee on Foreign Affairs has issued a formal recommendation to the Canadian government to update the existing sanctions legislation with the Magnitsky sanctions against human rights violators.
In their recommendation, the Committee said: “In honour of Sergei Magnitsky, the Government of Canada should amend the Special Economic Measures Act to expand the scope under which sanctions measures can be enacted, including in cases of gross human rights violations.”
The Magnitsky recommendations include:
1) Freezing assets of human rights violators,
2) Banning their entry to Canada,
3) Publishing a list of people and entities subject to these sanctions, and
4) Conducting an annual review of the Canadian government’s enforcement of the legislation.
The recommendation was inspired by the case of Sergei Magnitsky in Russia, but has been expanded to apply to human rights violators globally.
The Committee concluded:
“While originally focused on addressing the human rights situation in Russia, catalysed by the tragic case of Sergei Magnitsky, this movement now calls for the application of sanctions against human rights violators globally, and was instrumental in the passing of the Global Magnitsky Human Rights Accountability Act in the U.S.”
The report by Canada’s Foreign Affairs Committee cites William Browder, leader of the global Magnitsky Justice Campaign:
“Effectively, with a Magnitsky act, whether it be a Russian act specifically or a global act, it would give people some hope that in Canada, the United States, and other places, people do care.”
The Canadian Magnitsky Recommendation is a result of a five-month review of the sanctions regime conducted in the Canada’s House of Commons.
“The Committee heard compelling testimony from a number of highly-respected human rights activists regarding how sanctions can be a potentially valuable tool in the promotion and protection of human rights. They recommended that Canada expand the legislative authority under which the government can impose sanctions against human rights violators,” says the Foreign Affairs Committee report.
The report by the Foreign Affairs Committee quotes Zhanna Nemtsova, founder of the Boris Nemtsov Foundation for Freedom, named after her father, a Russian pro-democracy advocate who was murdered in 2015, saying:
“These are not sanctions against a country or even a government. These are sanctions against specific individuals responsible for corruption and for abusing human rights.”
The Standing Committee on Foreign Affairs was tasked with the review of the sanctions regime on 14 April 2016 by the Canada’s House of Commons.
The Committee held the review from October 2016, by conducting 13 hearings where different experts testified on the legislation. The committee assessed related policy issues from government officials, academics, researchers, stakeholders and practitioners.
Today, the Committee published its final report recommending the Government adopts the Magnitsky sanctions.
As part of its recommendations, the Foreign Affairs Committee called for the Government to publish a list of sanctioned persons:
“The Government of Canada should produce and maintain a comprehensive, public and easily accessible list of all individuals and entities targeted by Canadian sanctions containing all information necessary to assist with the proper identification of those listed.”
The Foreign Affairs Committee also recommended that the Government publishes an annual report on the implementation of the sanctions regime.
“The Government of Canada should amend the Special Economic Measures Act to require the production of an annual report by the Minister of Foreign Affairs, to be tabled in each House of Parliament within six months of the fiscal year-end, which would detail the objectives of all orders and regulations made pursuant to that Act and actions taken for their implementation.”
The next step is for the Canadian government to consider the parliament’s recommendation and draft legislation.
For more information, please contact:
Justice for Sergei Magnitsky
+44 207 440 1777
e-mail: info@lawandorderinrussia.org
www.lawandorderinrussia.org
billbrowder.com
Twitter.com/Billbrowder
Magnitsky Family Lawyer Remains in Intensive Care Unit, But no Longer in Critical Condition
March 22, 2017
Press Release
For Immediate Distribution
Magnitsky Family Lawyer Remains in Intensive Care Unit, But no Longer in Critical Condition
22 March 2017 – Russian lawyer Nikolai Gorokhov, who represents Sergei Magnitsky’s family, remains in the intensive care unit at Moscow Botkin hospital. His condition is presently assessed as serious, but not critical. He is conscious and responsive and this morning Nikolai was able to speak to doctors.
“Our thoughts and prayers are now with Nikolai and his family at this difficult time,” said William Browder, leader of the global Magnitsky justice campaign.
Since last night, Russian state media carried statements from Russian law enforcement sources dismissing foul play.
Details about the incident with Nikolai Gorokhov were first publicised soon after the incident by life.ru, a Russian media organization reportedly connected to Russian state security services.
The details presented by life.ru and other Russian state-controlled media contradict the information available from eyewitnesses. The notable differences concern the number of workers at the scene who were delivering a bathtub to the upper floor of the apartment building where the lawyer lives, and the whereabouts of the people at the scene during the incident.
Nikolai Gorokhov was scheduled to appear this morning, at 10:50 am, in front of the Moscow City Appeals Court to argue the new “Pavlov Leaks” case exposing organized crime and corruption in the US$230 million fraud investigation in which all Russian officials were exonerated and Sergei Magnitsky was accused posthumously.
The new evidence submitted by Nikolai Gorokhov in particular shows regular communications between Andrei Pavlov, lawyer for the Klyuev organized crime group who was involved in the US$230 mln fraud, and Oleg Urzhumtsev, ex Interior Ministry investigator (sanctioned under the US Magnitsky Act), who helped Pavlov and others evade responsibility for their role in the crime that Sergei Magnitsky exposed. Certain Klyuev gang members are identified in the communications by their criminal aliases such as: “The Bold” and “The Great.”
The outcome of the hearing at the Moscow City Court today is not known.
For more information, please contact:
Justice for Sergei Magnitsky
e-mail: info@lawandorderinrussia.org
twitter.com/Billbrowder
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