How A Fabricated Story From A Corrupt Billionaire Launched The New Cold War With Russia.

The real story behind Bill Browder and Sergei Magnitsky.

Background

With the coming close to the Ukraine proxy war, now is a better time than ever to look at what sparked the post-cold war hostilities between America and Russia.

Some could point to multiple events including the Maidan coup, the downing of the MH17 flight, the Russian intervention into the Syrian war, Russiagate, or the Ukraine proxy war.

But one event precedes all of these things.

That is the passing of the Magnitsky Act sanctions in 2012.

The bill, which put sanctions on Russian officials supposedly for “the detention, abuse, or death of Sergei Magnitsky, for the conspiracy to defraud the Russian Federation of taxes on corporate profits through fraudulent transactions and lawsuits against Hermitage, and for other gross violations of human rights”.

The bill was passed in the House and Senate and was eventually signed into law by then-President Barack Obama.

This story came from Bill Browder, an American billionaire who set up shop in Russia after the collapse of the Soviet Union to try to make money off of Russia’s new IMF-imposed economy.

According to Browder's account, he was the head of Hermitage Capital Management, which he called “the largest investment firm in Russia.” Browder alleged that in 2007 his office was raided by two Russian policemen named Artyom Kuznetsov and Pavel Karpov who seized documents that were “used to fraudulently re-register the ownership of our investment holding companies as well as to create $1 billion of fake tax liabilities”.

He alleged that “the corrupt officials used their new “ownership” of our companies and the fake liabilities to fraudulently reclaim $230 million of taxes we paid in the previous year”.

He claimed that he then “hired Sergei Magnitsky, then a 35-year-old tax lawyer, to investigate”.

According to Browder’s story “he helped us file criminal complaints against the police officers involved in the raids with a different branch of Russian law enforcement and was so brave that he even testified against them.” And in retaliation “was arrested by two of the same Interior Ministry officers against whom he had testified”.

Browder claimed that:

He (Sergei Magnitsky) was held in custody for 358 days and tortured in an effort to get him to retract his testimony. He never did. When the officials involved finally understood he would never break, they had him chained him to a bed while eight riot guards with rubber batons beat him to death.

This story, which Browder spread on an internet blog, was eventually picked up and spread by war hawks like John McCain who used it to draft and eventually pass the Magnitsky Act sanctions on Russia, which led to a serious increase in tensions between the U.S. and Russia.

At the time, the BBC noted that diplomats thought the sanctions were “a sore spot in US-Russia relations”.

The Maginsky Act eventually led to two spin-off sanctions bills in 2016 and 2021.

Bill Browder has been a central character in the new cold war with Russia, being paraded around on corporate media endlessly to call for a more hawkish approach to Russia and call any American diplomatic action towards Russia “appeasement”.

Even this year, Browder has been featured on outlets such as Britain’s Daily Mail and Canada’s CTV news to push for the continuation of the Ukraine proxy war.

There is only one major issue with all of this, Browder’s story is a complete fabrication.

About the only true thing in it is that Sergei Magnitsky died in a Russian prison. Everything else, however, was completely fabricated by Browder.

This was all exposed in a 2016 documentary, Browder did his best to bury titled “The Magnitsky Act: Behind the Scenes”.

The film was made by Andrei Nekrasov, a dissident Russian investigative journalist and Putin critic.

Nekrasov originally set out to make a fictional film about Bill Browder’s story, which he believed showcased the same Russian government oppression he had faced during his investigations.

However, after speaking to Browder and taking a closer look at the story, Nekrasov began to realize that something was off and set his investigative sights on Browder.

Through his extensive investigation showcased in the documentary, he was able to prove that Browder’s story was a complete fraud.

Reporter James Carden, wrote at the time in the Nation Magazine that:

Browder was able to stop a screening of the film for a group of European MPs in Brussels. His attorneys also successfully shut down a screening in Norway and Arte, a German-French television network, also canceled plans to run the film.

However, a separate lengthy investigation published three years later, in the German outlet Der Spiegel, confirmed almost everything that Andrei Nekrasov found in his documentary.

In this article, I will review the extensive investigative material showcased in the documentary and the Der Spiegel article and explain how the origins of the new Cold War with Russia are based on a fabrication.

Sergei Magninski Was Beaten To Death In Prison.

The first fabrication in Bill Browder’s story is the claim that Sergei Magnitsky was “chained to a bed while eight riot guards with rubber batons beat him to death”.

Pictured Above: Photos from Bill Browder’s website he used to “prove” Sergei Magnitsky was beaten to death.

Bill Browder published the pictures above on his Website, to prove that Sergei Magnitsky was “beaten to death” in a Russian prison.

However, in the documentary Andrei Nekrasov found a statement from Magnitsky’s lawyer that undermined this claim.

According to the lawyer, “Both knuckles on Sergei’s hands show deep abrasions and bruises”. His lawyer said, “I think he was simply banging on the door with all his force trying to make them let him out but none paid attention”.

He also found a forensic report from the time that suggested the marks on his arms were due to handcuffs, writing “handcuffs were used because of danger of self-harm or suicide”.

Sergei Magnitsky’s mother, who was interviewed in the documentary, also did not seem to buy into Browder’s version of how he died. When asked about the claim that Magnitsky was beaten to death, his mother instead blamed medical neglect saying that a forensic report showed he died from a “heart attack” but that he was “driven to that state” due to mistreatment in prison and medical neglect from the prison’s doctors.

She said she did not believe he was intentionally killed, saying “I can’t say that” when asked if he was, and saying “it would be harder to think he was killed than he died of an illness”.

Andrei Nekrasov also noted in the documentary that “there is no evidence that Magninski was tortured, in a summary describing his imprisonment, put together in the 10th month of his detention, Magninski does not claim he was generally treated more harshly than other inmates”.

He also found that “Magninski wrote that the doctors treated him adequately … for the first 8 months of his detention.” “Then after the transfer to another prison, Magninski does report medical neglect, but of these last four months he spent more than a month in a medical facility which is not mentioned in the official Browder story”.

The documentary also found some major manipulation by Bill Browder on this version of his story. According to Browder’s version, Magninski died from a head injury after the alleged beating.

Browder, on his website, intentionally left out a part of a Russian post-mortem examination in his English translation that disproves his claim.

In Browder’s translation he writes “(illegible) not found on the scalp” while the original Russian document says in clear black and white Times New Roman “No Damage found to the scalp”

Pictured Above: The Translation of the Autopsy Report On Bill Browder’s Website.

Pictured Above: What the report actually says.

Browder pretended he could not read something that was clearly legible because it disproved his narrative.

The Der Spiegel investigation goes into further detail about how Magnitsky actually died.

According to it:

A prison doctor had diagnosed him with an inflammation of the pancreas four and a half months prior, but shortly before Magnitsky was scheduled to undergo surgery, he was moved to another prison -- one without the necessary medical equipment for such an invasive procedure.

It noted that there was a human rights commission in Russia, which included “respected human rights activists and opponents of the Kremlin”.

According to the report:

In the months before his death, Magnitsky was constantly moved from one cell to another. His mother brought him medications that took 18 days to reach him. In September, he was forced to wear his jacket at night because his cell window lacked a pane of glass. His cell toilet often backed up. One time Magnitsky's abdominal pains became so acute that his neighbor began desperately kicking against the door of his cell and calling for help. It took prison staff five hours to get Magnitsky to a doctor.

The report also found that:

Magnitsky's condition worsened on his last day. He was transferred back to the prison where he was originally supposed to be operated on months prior. There, the dying man began to panic. He was sedated and restrained with handcuffs. Magnitsky was left alone in his cell, unobserved, without a doctor. "An ill person in severe condition was effectively left without medical attention for 1 hour and 18 minutes to die," the commission wrote in its report, a chronology of merciless negligence. Yet it contains no evidence of a targeted murder.

(Emphasis: Mine)

So Browder lied and overexaggerated how Sergei Magnitsky died, pretending he was beaten to death when in reality he died due to medical neglect in a horrible prison system.

Had this been the only thing Browder lied about, it could be written off as him embellishing to create a more compelling story, but this is only the tip of the iceberg on Browder’s lies.

Browder’s Fabricated Corruption Claims

Browder has repeatedly alleged that the Russian police detectives Artyom Kuznetsov and Pavel Karpov stole his documents in order to steal money through a tax rebate in his company’s name.

However, the evidence he gives to prove their corruption falls under scrutiny.

In the documentary, Andrei Nekrasov was actually able to meet with Pavel Karpov who provided documents that debunked Browder’s claims against him.

Browder had claimed that Pavel Karpov stole money from Browder because he only made 6000 dollars a year and had a net worth of 1.3 million dollars.

Browder had claimed that because Nekrasov owned a 930,000 flat, he had bought it with the money he allegedly stole from Browder’s company.

After meeting with Nekrasov, Karpov presented documentation that proves he actually paid for his flat in 2004, years before Browder accused him of stealing the money.

The flat cost far less at the time, due to the fact that it was not yet fully built, and only went up in value to $930,000 after it was already purchased.

Browder also accused Pavel Karpov of buying two plots of land with the stolen money, but Andrei Nekrasov showed documents that proved the land was bought in 2007, long before Browder alleges the fraud happened.

Browder also accused Karpov of buying a car with the money, but documents show it was actually bought by him in 2006- again before Browder alleged the fraud occurred.

Furthermore, Karpov’s tax statements show that he actually made 6000 dollars a month, not in a year like Browder claimed.

Browder’s claims about Pavel Karpov were so damaging that he actually sold his property in order to bring a libel suit against Browder in the UK.

Karpov lost the case, which Browder used as vindication. Nekrasov spoke to Browder at the end of the case, who told him

this is a real vindication for justice for Sergei Magnitsky. These people tried to shut us up, they tried to stifle our freedom of expression, and the judge made an unprecedented ruling, which is that libel tourists should be thrown out of England. He expected that the U.K. libel laws were so antiquated that a criminal could somehow stifle free speech using these old libel laws, and today’s judgment will be precedent setting.

However, the ruling was not exactly the vindication Browder claimed it was. Nekrasov found that the actual court ruling said “nothing in this judgment is intended to suggest that if the defendant (Browder) were to continue to publish unjustified defamatory material about the Claimant (Karpov), the Court would be powerless to act.”

The Der Spiegel investigation found that the only reason that Browder got off was because the court ruled that “the British courts had no jurisdiction over the matter.”

The paper noted that in the written verdict the judge actually found that Browder was a "story-teller” who did not “come close to pleading facts which, if proved, would justify the sting of the libel”.

The British judge overseeing the case also called it “a measure of vindication” for Pavel Karpov.

Sergei Magnitsky Was Not A Whistleblower

Perhaps the biggest hole in Bill Browder’s story is that there is no actual evidence that Sergei Magnitsky ever blew the whistle on any corruption.

To recap, Browder claims that Magnitsky was arrested after he learned and testified that the two police officers had stolen documents from Browder’s company in order to commit tax fraud.

However, contrary to Browder’s claim, there is no evidence this actually happened.

Andrei Nekrasov, in his documentary, found that the transcript Browder claimed was Magnitsky blowing the whistle was actually “an examination of Magnitsky as a witness in a criminal police probe”.

Furthermore, when Nekrasov actually read the original Russian document posted on Browder’s website he found that “what was described in an English outline (on Browder’s website) as Magnitsky’s testimony against Kuznetsov and Karpov, did not in the Russian original contain any accusations or evidence against the officers, not even their names”.

Andrei Nekrasov noted in the film that the first testimony posted on Browder’s website “does mention the officers‘ names, but it doesn’t accuse them, it just says there was this police raid”

This was confirmed by the Der Spiegel investigation which found that

The protocol itself tells a different story. Magnitsky does indeed mention the names of the two police officers nearly 30 times and describes their role during a search. But at no point does he make a concrete accusation against them personally. In a second protocol of a statement made on Oct. 7, Kuznetsov and Karpov are not mentioned at all. The first document also shows that Magnitsky did not make his statements entirely of his own free will, but as a witness in an ongoing investigation.

(Emphasis: Mine)

In other words, the entire crux of Brower’s story is false.

Broweder in his book claimed that

Sergei set up an appointment at the Investigative Committee for 5 June 2008. (...) He sat in the chair, provided the evidence and gave his witness statement, explicitly naming Kuznetsov and Karpov.

In reality, Sergei was actually called as a witness to an ongoing investigation into tax fraud.

Furthermore, Browder’s own documents, which he uses to show that Sergei blew the whistle on police corruption, show no evidence of him alleging any corruption by the two accused police officers.

This makes Browder’s entire story fall, he claims that Sergei was jailed for exposing corruption from the Russian police, but his own documents show that Sergei never actually alleged any corruption from them.

Documents obtained by Andrei Nekrasov indicate that the original complaint of tax fraud was actually made by a woman who “filed a report with a law enforcement officer on April 9th, 2008,” “six months before Magninsky’s October questioning”.

Pictured Above: Document showing that a police report was already filed before Magnitsky’s testimony.

Nekrasov found other Russian reports that named the woman as Rimma, Starova.

Nekrasov went looking for confirmation of this, not trusting Russian sources at face value.

Through the wayback machine, Nekrasov was able to find a press release from Hermitage Capital Management, Browder’s investment firm that confirmed this.

Pictured Above: A Press release from Bill Browder’s company confirming that Rimma, Starova did indeed accuse the company of committing tax fraud.

Nekrasov found that Rimma, Starova actually became “a figurehead of Browder’s companies after they were used to return 230 million dollars in tax fraud”.

This was confirmed by the Der Spiegel investigation which wrote that:

This was confirmed to DER SPIEGEL by Magnitsky's lawyer at the time, Dmitry Kharitonov, who said his client had been summoned to testify.

The reality of the story is that a worker from Browder’s company actually blew the whistle on the tax fraud being committed, which launched a criminal investigation into the company where Magnitsky testified and made no accusations of corruption from the police, only naming them in the context of a police raid that happened after the complaint.

Magnitsky was an Accountant, Not A Lawyer.

According to Browder’s version of events, Sergei Magnitsky was a Russian lawyer he hired to investigate the tax fraud, who found Russian police involvement

This, like all the other claims in his story, is false.

Early in the documentary when Nekrasov first interviewed Browder, he told him “we immediately went through our list of lawyers and called up the smartest lawyer we knew, a young man named Sergei Magnitsky”.

He said “If there was one person who knew the law up and down, backward and forwards it’s Sergei Magnitski”.

The big problem with this claim is that Sergei Magnitsky did not have a law degree and was actually an accountant.

Later in the documentary, Nekrasov went to Bill Browder’s launch of his book “Red Notice” and spoke to an associate of Magnitsky who told him “He wasn’t a lawyer, he was an accountant”.

Nonetheless, when Browder introduced his book, he continued to claim that “Magnitsky was my lawyer in Russia”.

Browder even admitted this in a second libel case that took place this time in New York, where the wealthy Russian Katsyv family sued him for allegedly making false accusations that they were involved in the tax fraud.

The Katsyv’s lawyer, Mark Cymrot, got Browder to admit that Magnitsky was not actually a lawyer. The transcript of the questioning published in the Der Spiegel investigation is shown below.

Cymrot: Was Magnitsky a lawyer or a tax expert?

Browder: He was acting in court representing me,

Cymrot: And he had a law degree in Russia?

Browder: I'm not aware he did.

Cymrot: Did he go to law school?

Browder: No.

Cymrot: How many times have you said Mr. Magnitsky is a lawyer? Fifty? A hundred? Two hundred?

Browder: I don't know.

Cymrot: Have you ever told anybody that he didn't go to law school and didn't have a law degree?

Browder: No.

Sergei Magnitski, it turns ou,t was not a lawyer but “an accountant for Browder’s companies since the 90s” as Nekrasov found in the documentary.

The Der Spiegel investigation found that

Magnitsky was instructed to come forward by a higher-ranking lawyer working for Browder. This lawyer, a Russian, admitted during the interview in London that Magnitsky had been sent as a stand-in for the CEO of a letterbox company who investigators in Moscow had actually wanted to speak to.

After Magnitsky testified in the criminal trial launched by a complaint from one of Browder’s employees, he deleted all reference to “Mrs. Starova” on his website and began spinning his Magnitsky fabrication at this point, claiming he was a “key analyst who discovered the 230 million dollar tax fraud”.

At this point Browder described him as a “Tax and Tax law advisor”.

Pictured Above: Bill Browder’s first attempt to spin Sergei Magnitsky as a whistleblower.

Bill Browder’s Corruption

It turns out that Bill Browder actually signed off power of attorney of his companies to a powerful figure in the Russian mafia.

It was after this, that the tax fraud took place in his company’s name.

Browder’s company then filed a lawsuit in an attempt to return the company to him, where he admitted there was “No motion to consider the said power of attorney falsified had been filed”. In other words, he admitted that the transfer of the power of attorney over his company to the Russian mafia was not falsified.

Multiple officials who now had the power of attorney over Browder’s company’s “mysteriously died”.

Viktor Markelov, one of Browder’s lawyers at the time who was imprisoned for the tax fraud, admitted in court that the Russian mafia member named Gasanov was seen with a man named “Sergei Leonidovitch” (Leonidovitch is Magnitsky’s middle name).

When asked in court if he knew Gasanov, Magnitsky said “I refuse a statement in this regard” instead of denying it.

Pictured Above: Magnitsky’s answer to the question “Do you know a man named Gasanov?

This is all really complicated but the basic just of it is that Bill Browder and his associates signed off the power of attorney on their company to figures in the Russian mafia so they could be one step removed from the million dollar tax fraud. They later used this to claim the companies were “stolen” from them.

Conclusion

The real story is that:

• Bill Browder signed off power of attorney on his company in order to commit tax fraud.

• When one of his employees named Rimma Starova went to the police about this, a criminal investigation was launched.

• Bill Browder’s accountant Sergei Magninski was brought into court to testify as part of this criminal investigation.

• Sergei Magninski was convicted for tax fraud due to his involvement in the scheme.

• Magninski later died in prison due to the brutal nature of the Russian prison system, which made him ill and denied him medical care.

Browder later took this story and turned it into a fantasy about Sergei Magninski being a heroic anti-corruption whistleblower.

Hawks in Western governments used the false story to justify sanctions on Russia, thus launching a new cold war between Russia and the West.

Many believe that things like the Steele Dossier are the origin of the Russia fearmongering the west, but this story shows the deceptions go much farther back.

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