Foreign Policy Magazine: They Killed My Lawyer. A story of Putin’s Russia.

December 25, 2009

Sergei Mag­nit­sky was our attor­ney, and friend, who died under excru­ci­at­ing cir­cum­stances in a Moscow pre-tri­al deten­tion cen­ter on Nov. 16, 2009. His sto­ry is one of extra­or­di­nary brav­ery and hero­ism, and ulti­mate­ly tragedy. It is also a sto­ry about how Stal­in­ism and the gulags are alive and well in Rus­sia today.

Ulti­mate­ly Sergei died for a prin­ci­ple — he died because believed in the rule of law in Rus­sia. When he stum­bled upon an enor­mous fraud against his clients and the Russ­ian gov­ern­ment, he thought he was sim­ply doing the right thing by report­ing it. He nev­er imag­ined that he would die for his efforts.

The pre­cise cir­cum­stances of his death are still unclear. We do know Sergei died sud­den­ly at the age of 37, after an 11-month deten­tion. At first, the deten­tion cen­ter where he died said the cause of his death was a rup­ture to his abdom­i­nal mem­brane, but on the same day the prison offi­cials changed their sto­ry, say­ing he had died of a heart attack. They refused his fam­i­ly’s request to con­duct an inde­pen­dent autop­sy. His diaries are report­ed to be missing.

Because Sergei is no longer alive to tell his sto­ry, I feel it is my duty to tell it for him. I am not a writer or a jour­nal­ist, but a fund man­ag­er at Her­mitage Cap­i­tal Man­age­ment. I ran what was the largest invest­ment fund in Rus­sia. Sergei was our Moscow-based out­side coun­sel who worked for the Amer­i­can law firm Fire­stone Duncan.

Sergei was­n’t involved in pol­i­tics, he was­n’t an oli­garch, and he was­n’t a human rights activist. He was just a high­ly com­pe­tent pro­fes­sion­al — the kind of per­son one could call up as the work­day was fin­ish­ing at 7 p.m. with a legal ques­tion and he would can­cel his din­ner plans and stay in the office until mid­night to fig­ure out the answer. He was a smart and hon­est man work­ing hard to bet­ter him­self and to make a good life for his wife and two kids.

The trag­ic events that led to his death began on June 4, 2007. That day, 50 police offi­cers from the Moscow Inte­ri­or Min­istry raid­ed Her­mitage’s and Fire­stone Dun­can’s offices, under the pre­tense of a tax inves­ti­ga­tion into a Her­mitage client com­pa­ny. There was no rea­son for the raid, as the com­pa­ny they were inves­ti­gat­ing was reg­u­lar­ly audit­ed by the tax author­i­ties, and they nev­er found any violations.

In the course of the raid, the police offi­cers took away all the cor­po­rate seals, char­ters, and arti­cles of asso­ci­a­tion of all of the fund’s invest­ment com­pa­nies — none of which had any­thing to do with their search war­rant. The sig­nif­i­cance of these seizures would only become appar­ent later.

In mid-Octo­ber 2007, we got a tele­phone call from a bailiff at the St. Peters­burg Arbi­tra­tion Court inquir­ing about a judg­ment against one of the fund’s Russ­ian com­pa­nies. It was a strange call because the com­pa­ny had nev­er been to court and we knew noth­ing about any law­suits or judg­ments in St. Petersburg.

We called Sergei right away and asked him to look into this call. After research­ing the sit­u­a­tion, he came back to us with shock­ing news. He dis­cov­ered that our invest­ment com­pa­nies had been sued by shell com­pa­nies that we had nev­er done any busi­ness with based on forged and back­dat­ed con­tracts. He also dis­cov­ered that the fund’s com­pa­nies had been rep­re­sent­ed by lawyers that the fund had nev­er hired, and who pro­ceed­ed to plead guilty to all the lia­bil­i­ties in the forged con­tracts. As a result, the fund’s com­pa­nies were hit with court judg­ments for hun­dreds of mil­lions of dol­lars. On top of that, the fund’s com­pa­nies had been fraud­u­lent­ly re-reg­is­tered in the name of a com­pa­ny owned by a man con­vict­ed of manslaughter.

Most shock­ing­ly, when Sergei ana­lyzed the forg­eries and fraud­u­lent re-reg­is­tra­tions, he was able to prove that they could have only been exe­cut­ed with the doc­u­ments seized from our offices by the Moscow Inte­ri­or Ministry.

On the back of Sergei’s dis­cov­er­ies, in ear­ly Decem­ber 2007, we filed six 255-page com­plaints out­lin­ing all the details of the frauds and the names of the police offi­cers involved. The com­plaints were filed with the heads of the three main law enforce­ment agen­cies in Rus­sia. How­ev­er, instead of inves­ti­gat­ing, they passed the com­plaints straight back to the spe­cif­ic police offi­cers named as con­spir­a­tors. Those offi­cers then per­son­al­ly ini­ti­at­ed retal­ia­to­ry crim­i­nal cas­es against Her­mitage employees.

At this point, Sergei was becom­ing vis­i­bly angry. Sergei was­n’t a dis­pas­sion­ate lawyer like many we have encoun­tered in the past. He was our advo­cate in the truest sense of the word.

By the sum­mer of 2008 it still was­n’t clear why the police would be involved in such a com­pli­cat­ed scam against us. If the inten­tion was to steal the fund’s assets in Rus­sia, they had failed because, by the time our com­pa­nies were stolen, the assets had been safe­ly moved out­side the country.

To help us find the answer, Sergei sent out more than 50 let­ters to dif­fer­ent tax author­i­ties and reg­is­tra­tion offices request­ing infor­ma­tion on our stolen com­pa­nies. Almost no one replied, but on June 5, 2008, Sergei received a let­ter that broke the case wide open.

Accord­ing to the let­ter, which was from tax author­i­ties in Khim­ki, a sub­urb of Moscow, our stolen com­pa­nies had been re-reg­is­tered in Khim­ki, and had opened bank accounts at two obscure Russ­ian banks. Once we learned about the banks, every­thing start­ed to make sense. At those banks, Sergei found a spike in deposits exact­ly equal to the tax­es that the Her­mitage Fund com­pa­nies had paid in 2006. Appar­ent­ly, the peo­ple who stole our com­pa­nies did so to fraud­u­lent­ly obtain $230 mil­lion that the Her­mitage Fund com­pa­nies had paid in tax­es in 2006 by claim­ing that the sham court judg­ments had wiped out their profits.

The refund of “over­paid tax­es” — the largest in Russ­ian his­to­ry — had been grant­ed by the Moscow tax author­i­ties in two days on Dec. 24 2007. The date of the wire trans­fer showed that it was car­ried out in total dis­re­gard of the com­plaints the fund filed to the Russ­ian author­i­ties three weeks earlier.

Sergei did­n’t start out as an anti­cor­rup­tion cru­sad­er, but when cor­rup­tion stared him in the face, he felt com­pelled to do some­thing about it. In July 2008, Sergei helped us pre­pare a detailed crim­i­nal com­plaint about the stolen tax mon­ey, which was filed with sev­en dif­fer­ent Russ­ian gov­ern­ment agencies.

After our com­plaints were filed, the Inte­ri­or Min­istry offi­cers who were involved in the fraud retal­i­at­ed by open­ing crim­i­nal cas­es tar­get­ing all the lawyers who rep­re­sent­ed the fund. The pres­sure became so intense that six of our lawyers from four dif­fer­ent law firms were forced to either leave the coun­try or to go into hiding.

The one lawyer who did­n’t leave Rus­sia was Sergei. In spite of the clear­ly mali­cious activ­i­ty by the police, he was sure that he was safe because he had nev­er done any­thing wrong or ille­gal. He believed that the law of Rus­sia would pro­tect him.

His belief in jus­tice was so strong that he went on to do some­thing many peo­ple would be pet­ri­fied to even con­sid­er. On Oct. 7, 2008, he went to the offices of the Russ­ian State Inves­tiga­tive Com­mit­tee (the Russ­ian equiv­a­lent of the FBI) and tes­ti­fied against two offi­cers of the Inte­ri­or Min­istry, Lt. Col. Artem Kuznetsov and Maj. Pavel Kar­pov, for their involve­ment in the theft of $230 mil­lion. It was an enor­mous­ly brave move, and we feared for him that day. Amaz­ing­ly, Sergei was the only per­son who was­n’t worried.

Just over a month lat­er, three offi­cers who direct­ly report­ed to Kuznetsov went to Sergei’s apart­ment at 8 a.m. and arrest­ed him. He was charged with being the direc­tor of two Her­mitage Fund com­pa­nies that alleged­ly under­paid tax­es in 2001. He was arrest­ed even though the com­pa­nies had clean audits and Sergei had had no involve­ment with either of the com­pa­nies in 2001. How­ev­er, the law did­n’t mat­ter. The inves­ti­ga­tors had oth­er plans for Sergei.

Sergei was brought to Pre-Tri­al Deten­tion Cen­ter No. 5 in Moscow, but with­in months he was trans­ferred to a tem­po­rary deten­tion facil­i­ty with much harsh­er con­di­tions, and then he was moved sev­en times between four more deten­tion cen­ters until he was moved to Matrosskaya Tishi­na prison.

Each move was pro­gres­sive­ly worse, and we start­ed to get word that he was being kept in very harsh con­di­tions. We heard about him being kept with eight oth­er inmates in prison cells that only had four beds so they had to sleep in shifts. We heard about how the prison author­i­ties nev­er turned the lights off at night so even if he got a bed, it was almost impos­si­ble to sleep. Most dis­turb­ing of all, we got news that he was start­ing to lose weight pre­cip­i­tous­ly. Since his arrest, he had lost 40 pounds.

On July 1, 2009, at Matrosskaya Tishi­na, Sergei was diag­nosed with pan­cre­ati­tis and gall­stones. He was told that he should be mon­i­tored close­ly, and that he would need a repeat exam­i­na­tion and surgery with­in a month. As he was prepar­ing for a fol­low-up vis­it to the med­ical cen­ter, on July 25, 2009, he was abrupt­ly trans­ferred to Butyr­ka prison, a max­i­mum secu­ri­ty facil­i­ty known to be one of the tough­est in Russia.

At Butyr­ka, Sergei’s con­di­tion dete­ri­o­rat­ed sharply, and he devel­oped excru­ci­at­ing stom­ach pains. He repeat­ed­ly asked the prison author­i­ties, pros­e­cu­tors, inves­ti­ga­tors, and the courts for med­ical atten­tion, and he was repeat­ed­ly denied it by all of them. At one point the pain became so intense that he could­n’t even lie down. His cell­mate banged on the door for hours scream­ing for a doc­tor. When one final­ly arrived, he refused to do any­thing for Sergei, telling him he should have obtained med­ical treat­ment before his arrest.

We did what we could do to help him. We tes­ti­fied in front of the U.S. Con­gress about Sergei; we asked the U.S. State Depart­ment and the British For­eign Office to bring his case up with the Russ­ian For­eign Min­istry; we reached out to the pro­fes­sion­al asso­ci­a­tions; and we con­stant­ly pro­vid­ed infor­ma­tion to jour­nal­ists to write about his sit­u­a­tion. But none of it mat­tered with­in Rus­sia. While we were lob­by­ing from the out­side, they were putting more and more pres­sure on Sergei from the inside.

His tor­men­tors want­ed to pres­sure him to with­draw his tes­ti­mo­ny against the police offi­cers and make false state­ments against him­self and his client, the Her­mitage Fund. Most cyn­i­cal­ly, they specif­i­cal­ly want­ed him to take respon­si­bil­i­ty for the theft of $230 mil­lion that they had been stolen from the state. As a lawyer and some­one who believed in jus­tice, there was no way he would be pres­sured into per­jur­ing him­self no mat­ter how much pain he had to endure. Instead, he wrote even more com­plaints doc­u­ment­ing the hor­rif­ic tor­ture he was being sub­ject­ed to.

The more Sergei com­plained, the more the pres­sure increased. He was moved to cells where sewage would spew up from the hole in the floor that served as the toi­let. He was put in cells with no glass in the win­dows to pro­tect the inmates from the frigid Russ­ian weath­er. The prison author­i­ties denied him any oppor­tu­ni­ty to show­er, or sim­ply access hot water. Worst of all they denied him any vis­its from his wife or moth­er, or even the pos­si­bil­i­ty to speak to his two young chil­dren on the tele­phone for the 11 months he was in deten­tion, which must have been tru­ly heart­break­ing for a man so com­mit­ted to his family.

Despite all this and more, he was nev­er bro­ken. Dur­ing his 358 days in deten­tion, Sergei and his lawyers filed more than 450 com­plaints doc­u­ment­ing all of the breach­es of Russ­ian law, and the vio­la­tions of his human rights. He wrote on behalf of him­self and on behalf of oth­er detainees. Few peo­ple could have man­aged such a prodi­gious effort while being sub­ject­ed to such phys­i­cal tor­ment. Sergei did­n’t have access to an office, library, or a com­put­er. He man­aged to do all this with­out even a table to write on. Each time Sergei filed a com­plaint, it was reject­ed or sim­ply ignored, but each defeat just served to make him more indig­nant and deter­mined. He was always the con­sum­mate pro­fes­sion­al. There was nev­er any emo­tion in his com­plaints, even after all the tor­ture he endured. They were crisp and exact.

Through­out this ordeal, Sergei stood true to his prin­ci­ples — refus­ing to per­jure him­self and make false state­ments against him­self and his client — no mat­ter what new suf­fer­ing was devised for him.

In the end, Sergei died sud­den­ly in prison on Nov. 16, 2009. He entered prison a healthy 36-year-old man, and 11 months lat­er he was dead. Many ques­tions remain, but what is clear is that the abus­es he suf­fered dur­ing his year in deten­tion ulti­mate­ly caused his death.

One can nev­er judge the true char­ac­ter of a per­son until they are faced with extreme adver­si­ty. Most peo­ple, if faced with a far less­er chal­lenge than Sergei, would have giv­en in. But for Sergei, his integri­ty and hon­or were more impor­tant than any phys­i­cal pain he was suf­fer­ing. Sergei was an ordi­nary man who became an extra­or­di­nary hero. If we all could only show a frac­tion of the brav­ery and for­ti­tude Sergei did, the world would be a much bet­ter place. Sergei, his hero­ic fight, and the ideals he stood for must nev­er be forgotten.

God bless Sergei and his family.

Pub­lished in For­eign Pol­i­cy Mag­a­zine.

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