Navalny may become fire that lights fuse in Russia: Bill Browder

Bill Browder (William Felix Browder), the CEO and co-founder of Hermitage Capital Management, who was a guest of the “Rock Rachon” programme, said that the Russian prominent oppositionist Alexei Navalny is playing hardball and his actions can become a fire that lights the fuse.

According to Mr Browder, Navalny is playing hardball. Vladimir Putin tried to intimidate him, but he did not flinch; instead, he released a viral video showing the corruption of Putin and Kremlin authorities on an unbelievable scale.

In the opinion of the Hermitage Capital Management CEO, Alexei Navalny is the all-time biggest threat to Vladimir Putin. “He’s genuinely a widely popular alternative to him as a politician and has a lot of followers among the youngest part of society,” he said.

Navalny also learned how to bypass the state-controlled media and is active on youtube and other media. Bill Browder stated that his message is attractive for Russians, which resulted in Vladimir Putin trying to kill him.

Meanwhile, the situation with the poisoning attracted people in the west who started to keep an eye on Navalny’s case.

Mr Browder believes that the fact he’s ready to go back to Russia where he may face imprisonment or even death, “elevates him to the level of Nelson Mandela”.

According to the Rock Rachon guest, in the course of his long presidency, Vladimir Putin has accumulated about USD 200 bn, which would make him the richest person in the world. Navalny’s actions could result in all of that money being seized, which the Russian president is particularly afraid of.

Mr Browder also touched on the issue of some governments affiliating with Russia despite the corruption scheme of the Kremlin widely known abroad. In this context, the Nord Stream and Nord Stream 2 projects, as well as the involvement of the former German Chancellor Gerhard Schroeder in relation to Putin were mentioned.

Click here to watch the full interview.

Shareholder rights activism and the face-off with Russia’s Interior Ministry

William Felix Browder is an American-born British financier and political activist. He is the CEO and co-founder of Hermitage Capital Management, the investment advisor to the Hermitage Fund, which at one time was the largest foreign portfolio investor in Russia. The Hermitage Fund was founded in partnership with the Republic National Bank, with USD 25 million in seed capital. The fund, and associated accounts, eventually grew to USD 4.5 billion of assets under management. By 1997 the Hermitage Fund had grown 238 percent and was the best-performing fund in the world.

The primary investment strategy of Mr Browder was shareholder rights activism. He took on large Russian companies such as Gazprom, Surgutneftegaz, Unified Energy Systems, and Sidanco. In retaliation, on November 13, 2005, Mr Browder was refused entry to Russia, deported to the UK, and declared a threat to Russian national security.

Eighteen months after Mr Browder was deported, on June 4, 2007, Hermitage Capital's offices in Moscow were raided by twenty-five officers from Russia's Interior Ministry. Twenty-five more officers raided the Moscow office of Mr Browder's American law firm, Firestone Duncan, seizing the corporate registration documents for Hermitage's investment holding companies. Mr Browder assigned Sergei Magnitsky, head of the tax practice at Firestone Duncan, to investigate the purpose of the raid. He discovered that while those documents were in the custody of the police, they had been used to fraudulently reregister Hermitage's holding companies to the name of an ex-convict.

The reregistration of the Hermitage holding companies was an intermediate step before the perpetrators used those companies to apply for a fraudulent USD 230 million tax refund, awarded on December 24, 2007.

In response, in June and October 2008, in testimony to the Russian State Investigative Committee, Magnitsky testified against the perpetrators of the fraud, including the Interior Ministry officials who conducted the raid on Hermitage's offices. Five weeks after his second testimony, on November 24, 2008, Sergei Magnitsky was arrested at his home; among those present at his arrest were officials he had named in his testimony. While he was in custody, Magnitsky was mistreated, and began complaining of severe pain in his back in May 2009. He became increasingly ill over the next several months and died. Medical expert reports that have been carried out in the years since have concluded that for the remainder of his time in pre-trial detention, Magnitsky received inadequate medical care, and may have even been given medication that aggravated his pancreatitis. The court judgement notes that "domestic authorities unreasonably put his life in danger."

After Magnitsky's death, Mr Browder lobbied for Congress to pass the Magnitsky Act, a law to punish Russian human rights violators, which was signed into law in 2012 by President Barack Obama. In 2013, both Magnitsky and Mr Browder were tried in absentia in Russia for tax fraud. Both men—Magnitsky had died four years prior—were convicted and sentenced to imprisonment. Interpol rejected Russian requests to arrest Mr Browder, saying the case was political. In 2014, the European Parliament voted for sanctions against 30 Russians believed complicit in the Magnitsky case; this was the first time it had taken such action.

In July 2017, Mr Browder testified to the U.S. Senate Judiciary Committee on Russia's alleged interference in the 2016 U.S. presidential election.

On October 21, 2017, the Russian government attempted to place Browder on Interpol's arrest list of criminal fugitives, which Interpol eventually rejected the fifth such request on October 26, 2017. After the initial request, Mr Browder's visa waiver for the US was automatically suspended. After a bipartisan protest by US Congressional leaders, his visa waiver was restored the following day. While visiting Spain in May 2018, Mr Browder was arrested by Spanish authorities on a new Russian Interpol warrant and transferred to an undisclosed Spanish police station. He was released two hours later, after Interpol confirmed that this was a political case.

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