‘Ill-gotten cash’ must not go back to Russians, MPS tell Switzerland
BRITISH MPS have called on the Swiss authorities to scrap plans to return millions of pounds to a group of Russians sanctioned for links to Vladimir Putin.
The funds were part of a $230million (£190million) fraud exposed by Sergei Magnitsky, a lawyer who died in a Russian prison after he was beaten and denied medical treatment.
The Swiss courts have ruled that $15.3 million should now be returned to three Russians implicated in the fraud, despite a senior investigator in the case being convicted of accepting bribes, after the authorities failed to establish proof of a criminal conspiracy.
MPS are urging James Cleverly, the Foreign Secretary, to not only raise the matter with his Swiss counterpart but to consider whether to end co-operation with the Swiss authorities.
In a joint letter, Jonathan Djanogly, the MP for Huntingdon, and Dame Margaret Hodge, MP for Barking, state: “The UK has made every effort to lead the way on holding Russia to account for Putin’s invasion through [sanctions] and providing support for Ukraine.
“It seems unreasonable that our supposed ally would return ill-gotten gains to these Kremlin-linked perpetrators. It also raises the question of how much more illicit Russian funds are available to Putin’s officials in Switzerland.”
The Swiss courts froze $19.6million in 2011 as part of an investigation into alleged money laundering by Vladlen Stepanov, the husband of a Russian tax official; Dmitry Klyuev, the owner of a Russian bank and head of an organised crime group; and Denis Katsyv, the son of a senior Russian official.
The three were investigated for allegedly receiving funds as part of a plot by Russian interior ministry officials to defraud the Hermitage Capital investment fund of $230million through bogus tax rebates. When Magnitsky, the fund’s lawyer and tax adviser, exposed the plot he was arrested and tortured, dying without trial in November 2009.
Mr Stepanov and Mr Klyuev were later sanctioned by the UK government under anti-corruption laws named after Magnitsky. They have also been sanctioned by the US, Canada and Australia.
Mr Katsyv paid $6million to the US Department of Justice to settle its investigation into the Hermitage Capital case but the Swiss Federal Criminal Court ruled last year that there was no proof of a “criminal organisation” running the tax rebate scam.
Bill Browder, the US financier who set up Hermitage Capital and campaigned for the Magnitsky anti-corruption laws, told The Daily Telegraph: “It’s outrageous that in the middle of Putin’s invasion of Ukraine, Switzerland would return money to Kremlin-linked Russian individuals. The money should be used for the reconstruction of Ukraine.”
He added: “Countries like the UK and US should downgrade their legal relations with Switzerland.”
In their letter to Mr Cleverly, Mr Djanogly and Dame Margaret state: “During the Swiss investigation, the most senior investigator accepted bribes from his Russian counterparts to sabotage the case.
“Although he was fired and later convicted, Swiss law enforcement ruled last year that $15.3million could be given back to the Russian individuals.”
They added: “We ask you to immediately make representations to Ignazio Cassis, the Swiss foreign minister, to demand reassurances that these funds will not be returned to Russia.”