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Winter Reading – Red Notice by Bill Browder

February 23, 2019

I’m in the middle of what could be described as a reading holiday. A warm and pleasant corner of south east Asia, a few trips out, but much of the time reserved for hours of concentrated reading. If you follow this blog you may have noticed some of the books I’ve been ploughing through.

I review books not because they’re new and someone’s paying me to write about them. I do so because it’s easy to get to the end without stopping to think critically about what I’ve read, other than to reflect that it was good, so so or not great. I also like to place the book in the context of other stuff going on at the time, either in my life or that of others.

With that in mind, next up is Red Notice, which is the story of Bill Browder’s rise as the most successful foreign investment manager in post-Soviet Russia, and the subsequent moves by the Russian state against him, culminating in the arrest, torture and murder of his lawyer, Sergei Magnitsky. Magnitsky, along with Browder and other colleagues, had exposed massive corruption within the Russian government. Putin was not best pleased, especially when Browder persuaded the US congress to pass the Magnitsky Act, which mandates the use of sanctions against individuals with links to the United States who use torture and extrajudicial killing in their countries. Browder has been a target ever since.

All good. I knew the story, if not the details. I nearly dumped this one fairly early on because – and this is where current context comes in – I felt quite repulsed by the obvious pride with which Browder recounts his business coups in Yeltsin’s Russia. If Russia’s oligarchs were reprehensible in hoovering up huge swathes of Russian industry for a song, so were the foreign investors, including Browder, who attempted to do the same.

His descriptions of the cynical organisations for whom he worked before founding Hermitage Capital – Boston Consulting and Salomon Brothers – reeks of the amorality and greed that pervaded Wall Street before 2008 crash and, as far as I know, still does so today.

It seems that in defending his own interests against the predatory oligarchs with whom he was doing business he had a conversion of St Paul that turned him into a crusader against state corruption. But it must have been pretty obvious at the time when he was acquiring Russian stocks at a tiny fraction of their value that he was dealing with some highly dubious people. Yet he was content to build up a huge investment fund on the back of their dubious dealings.

Browder’s story shows how Russia, whether through economic and political naivety or kleptocratic intent, allowed itself to be raped by a bunch of ruthless and amoral individuals. And when an ex-KGB agent came to power, he turned out to be more ruthless than all of them. Vladimir Putin turned the tables on the oligarchs by stripping those who would not bend to his will of their wealth, power and even in some cases liberty. When Browder fought the authorities who turned the heat on him, you could argue that he was foolish, but he was certainly courageous.

But that doesn’t exonerate him and other opportunists, Russian or foreign, from gorging on the corpse of the Soviet Union and contributing to the resentment felt by millions of impoverished and humiliated Russians against the West, fuelled by a president who encouraged a tide of nationalism and became the biggest oligarch of them all.

As read the book I couldn’t contain a feeling of disgust at what happened in Russia in the 1990s, and sorrow at the lost opportunities represented by foreign politicians, especially in the US, who were content to watch the country eat dirt, while their financiers and oil companies were happy to pile in and feed, because “if we don’t others will”.

Whatever could or could not have been done to prevent the rise of the “businessmen” and the kleptocratic state, I can’t help feeling that Russia’s foreign partners both in business and politics were complicit in the disaster and must share some of the responsibility for the consequences. And that includes Bill Browder.

But ultimately he redeemed himself through his courageous response to the death in custody of Sergei Magnitsky. The desire to to create consequences for those who were responsible for the lawyer’s torture and death overrode his concerns about rebuilding his investment business. Through a public relations campaign and personal lobbying in the face of Russian intimidation from Putin downwards, he managed to persuade the US Congress to pass the Magnitsky Act.

For that he deserves great credit. Given the long arm of Putin’s security services, who most recently reached out to poison the Skripals in Salisbury, one suspects that Browder’s story is not yet over. But hopefully his fame and status as a public figure will deter the Russian state from striking at him for fear of the international outrage and adverse consequences that would follow.

As for the oligarchs who toed Putin’s line. they got away with it. They are free to buy football clubs, mansions in Kensington and apartments in Trump Tower. Some of those closest to Putin have been sanctioned, but others are feted in London, New York and Washington despite their murky pasts. The first of them to cross swords with Browder made a blatant attempt to screw his fund via a dodgy share dilution. The same person is now a trustee of the Guggenheim Foundation in New York, and 2016 France awarded him the Legion of Honour after he donated works of art to be displayed at the Louvre. In other words, a very respectable man.

As the puff on the book’s cover suggests, Red Notice does read like thriller fiction, though attempts to add colour to the story, such as what he had for breakfast at this or that hotel, or the fact that a Foreign Office official poured tea from a blue and white china pot, permeating the room with the smell of Ceylon tea, jar a little.

That said, it’s a compelling story whose implications reach to the present day, especially at a time when Donald Trump’s real or imagined ties with Russia dominate public life in America.

I wish Bill Browder a safe and happy life.



From → Books, Business, Politics, UK, USA

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