Why Exactly Does Putin Hate the Magnitsky Act?

The man who lobbied for it explains its importance and why it’s at the heart of the Trump Tower meeting.

Russian President Vladimir Putin
Russian President Vladimir Putin delivers a speech during a meeting with Russia’s government in his residence in Novo-Ogaryovo, outside Moscow, on Wednesday.

Alexey Nikolsky/AFP/Getty Images

On a recent episode of Trumpcast, Bill Browder joined Jacob Weisberg to discuss the Magnitsky Act—the supposed reason why Donald Trump Jr. met with a group of Russians during the campaign. Browder, author of Red Notice: A True Story of High Finance, Murder, and One Man’s Fight for Justice, hired Sergei Magnitsky to investigate why the Russian police had raided and seized his company’s offices in June 2007. Magnitsky found that Browder’s company had been seized to steal $230 million in taxes it had paid to the Russian government. Magnitsky was arrested, tortured, and killed in 2009, and Browder later pushed Congress to pass the Magnitsky Act, which sanctions people connected with Magnitsky’s murder. This conversation has been edited and condensed for clarity.

Jacob Weisberg: What was your reaction to what we’ve found out about the Trump Tower meeting?

Bill Browder: The original spin out of the Trump camp was that the meeting was about adoptions. It had nothing to do with adoptions; it was exclusively about repealing the Magnitsky Act, which is something very near and dear to my heart.

My second reaction was that it wasn’t unexpected. Vladimir Putin has made it his single largest foreign policy priority to get rid of the Magnitsky Act. It is not a surprise at all given how much money has been spent and how many lobbyists and intermediaries are involved that they somehow found their way to Donald Trump, who at the time was the Republican nominee.

Why is this bill such a priority for Putin?

Putin has amassed an enormous fortune over the 17 years that he’s been at the top of the heap in Russia, and the Magnitsky Act very specifically would target him. We have been able to track down information and evidence that shows that some of the proceeds from the crime—the $230 million fraud that Sergei Magnitsky uncovered, exposed, and was killed over—went to a man named Sergei Roldugin. (For those of you who remember the Panama Papers, he was the famous $2 billion cellist from Russia who got all this largesse from various oligarchs in Russian companies.)

Roldugin received some of the money from the Magnitsky crime, and it’s well-known that he is a nominee trustee for Putin. When Putin reacts to the Magnitsky Act with such personal venom, he’s reacting because he feels like the entire purpose in life, which was to steal money from the Russian state and keep it offshore, is at risk. That’s why they’re ready to ruin relations with America over the Magnitsky Act by banning adoptions and doing other things, and that’s why so much money has been spent fighting the act and fighting me, the person behind the campaign to get Magnitsky Act in the United States and around the world.

This $230 million wasn’t stolen from you; it was stolen from Russian taxpayers. Your company was hijacked in order to claim this phony tax refund, so it was actually Russian public funds.

Putin and his cronies were stealing money from the state, as they do in many other instances. A lot of people look at this number and say, Well, $230 million is not even a pimple on the whole corruption proceeds. But this particular pimple was exposed by Magnitsky, and once you start pulling on this string, it leads to other strings. Just for example, the tax office No. 28 in Moscow, which was the tax office that authorized this illegal $230 million tax refund, it was investigated by Novaya Gazeta, which is one of the last remaining independent newspapers in Russia, and Novaya Gazeta found that this tax office had stolen or authorized $1 billion of fraudulent tax refunds. That’s just one little tax office. Imagine all the different scams going on, building the Olympic village, building railroads, building pipelines. It adds up to some seriously, seriously large amounts of money.

You make it sound a little bit like it’s just about Putin himself and whatever resources he’s securing abroad.

Putin is the sort of the big boss, but I would guess that there’s like 10,000 people who surround him that are big recipients of these crimes. I would guess that a trillion dollars has been stolen from the state by Putin and these 10,000 people since he came to power. This is just such an extraordinary amount of money, and it’s so important for them not to have this game called over. Part of the problem with the Magnitsky Act is it does just that. I should point out that it doesn’t just seize the assets in the United States. It puts people’s names on the U.S. Treasury sanctions list. Once your name is on a Treasury sanctions list, you cannot open a bank account anywhere in the world. You can’t open a bank account in Peru; you can’t open one in Dubai. You can’t even open one in China because there’s no bank in the world that wants to be in violation of U.S. Treasury sanctions. You’re effectively a financial pariah from that moment forward, and no international bank, no international company, just about nobody will touch you as a legitimate person to do business with.

If you’d say there are 10,000 people in Russia maybe who’ve been beneficiaries of this enormous act of confiscation and thievery, how many of them are affected by the Magnitsky Act?

Everybody is kind of affected by the Magnitsky Act. At the moment, there’s only 44 people on the Magnitsky list, but nobody knows who’s next. They’ve all got this plan, which is to do terrible things in Russia, and then if ever the Putin regime were to end, they could then travel abroad, live in the houses that they bought, spend the money in the banks that they’ve squirreled away, and live a quiet life. It’s almost like it terrorizes the criminals because nobody knows who’s next.

There’s sort of two interpretations of it we’re working on at the Trump Tower meeting. One is about the Magnitsky Act. The other is that this was an intelligence operation, and it was part of a long-running scheme to get blackmail material on the Trumps or to try to influence them. I’m not sure these two things are totally incompatible, but do you think it was one or the other?

I’m pretty sure it’s the first one. The Russians have been very clear that they really dislike this piece of legislation. If you ask any member of the Russian opposition what really gets under Putin’s skin, it’s this. These people have been at it in very blunt and not unsophisticated ways of trying to get this piece of legislation repealed. What we have to speculate about, though, is what they were offering in return.

What’s your speculation, Bill?

In the KGB, they spend lots of time studying human reactions to things. They would have studied their subjects before they had gone into that meeting, and they would have said, “What do these people want?” What these people wanted was to win the election, so how could they help? Were these particular Russians offering that? I don’t know. I think Bob Mueller will be the one to decide what’s what.

The Trumps probably said, Let’s get out of this meeting. They don’t have anything good for us.

If that’s what the pitch was at face value, then any reasonable person would have thought, This is ridiculous. I’m not sure who is saying what to whom, and I don’t think we can believe anything anyone has said out of that meeting.

When we spoke in January, you raised this concern about Trump capitulating to Putin’s agenda on sanctions, on NATO, on a whole range of issues. We’ve now had six months of this. What’s your diagnosis so far?

At this moment in time, there’s been not an inch of capitulation, so every single sanction is in place, and NATO is still there. Our position on all the issues as official positions of the United States is exactly how it was before. I credit that to the professionals who are working with the defense secretary, to Nikki Haley at the United Nations, and various others. So far all the sweet words said by Donald Trump about Vladimir Putin haven’t changed any U.S. policy to date. Of course, I watch this like a hawk. I watch everything that happens, and nothing has happened yet, and I’m keeping my fingers crossed that nothing will happen.