While the economic impact of the targeted sanctions is limited, the bills have been a global embarrassment for Russia, making it a Kremlin goal to discredit and repeal them. The bill also irritates Putin because it targets business leaders close to him, punishes Russia over its internal affairs and lets the U.S. government punish Russians around the world for violations of U.S. law.
“You have a trifecta of things that really piss Putin off,” says Steve Hall, a former Moscow station chief for the CIA.
The grudge goes back to 2008, when the Russian government granted a fraudulent $230 million tax refund to an organized crime group that included Russian government officials using documents confiscated from the Moscow-based operations of the British investor Bill Browder, who had fallen out of favor with Putin. Magnitsky, a lawyer working for Browder to expose the fraud, was arrested and died in 2009 in a Russian prison, where there is evidence he was badly beaten and denied medical care.
Browder—who was born in Chicago but renounced his U.S. citizenship in 1998—responded by lobbying Congress to pass sanctions against Russians implicated in Magnitsky’s death.
In 2012, Congress, led by Democratic Sen. Ben Cardin of Maryland and Republican Sen. John McCain of Arizona passed the Sergei Magnitsky Rule of Law Accountability Act with broad bipartisan support over the objections of the Obama administration, which felt it would complicate U.S.-Russia relations.
Days after President Barack Obama signed the bill into law in December 2012, the Russian Duma retaliated—voting overwhelmingly to ban the adoption of Russian children by American parents. Putin called the act “a purely political, unfriendly move.” Then in April 2013, the Kremlin banned several former and current U.S. officials—including “torture memos” author John Yoo and a former army commander of Guantánamo Bay— from entering Russia.
The Kremlin also escalated its vendetta against Browder—whose business activities were initially tolerated by Putin—requesting three international warrants for his arrest in 2013 and 2014, all of which were rejected by Interpol. Russian authorities have opened numerous criminal cases against Browder, including one for the murder of Magnitsky.
Browder, meanwhile, has lobbied other countries to adopt similar sanctions, and last year, Congress took up another bill named for Magnitsky to sanction human rights abusers around the world.
A crucial part of the Kremlin’s pushback has been Natalia Veselnitskaya, the Russian lawyer who met with Donald Trump Jr., Jared Kushner and Paul Manafort last June. It was adoption that Veselnitskaya really wanted to talk about in the June 9 meeting, Trump Jr. initially said—a claim that raised suspicions even before the New York Times obtained emails suggesting otherwise. “Russia suspended the adoptions as leverage to end U.S. human rights sanctions. If you’re talking about one, you’re talking about the other,” former State Department official Tom Malinowski tweeted on Saturday.
Since 2014, Veselnitskaya had been representing Prevezon, a firm incorporated in Cyprus and owned by Denis Katsyv, the son of Pyotr Katsyv, a former minister of transportation for the Moscow region, in a federal forfeiture case in New York in which he stood accused of laundering millions of dollars in proceeds from the Magnitsky fraud.
Veselnitskaya retained a former New York City prosecutor named, improbably enough, John Moscow to represent the younger Katsyv in court. Moscow’s law firm BakerHostetler in turn retained the research firm Fusion GPS, which traced assets in the U.S. to Browder—whose tip to the Justice Department sparked the Prevezon case—and aided efforts to serve the investor with a subpoena.
Fusion GPS says its actions on Prevezon’s behalf were limited.
“Our work consisted almost entirely of supporting the discovery process,” the research firm said in a statement, which continues, “FGPS has on occasion assisted reporters covering the Prevezon case by clarifying public information from its litigation research and from the court record. We are not the media-relations representatives for either Prevezon or BakerHostetler. FusionGPS is a research firm and is not engaged in lobbying on this or any other matter.”
Here’s where things get even more complicated: Fusion is the same firm that commissioned a dossier of explosive but unverified allegations about Trump’s ties with Russia from the former MI6 agent Christopher Steele. It has been widely reported that Fusion was first hired by a Republican client to research Trump during the Republican primary in late 2015 and continued the Trump research for a Democratic client in 2016, when it commissioned the Steele dossier.
Congressional committees have taken a keen in interest in Fusion’s activities; this week, Senate Judiciary Committee Chairman Chuck Grassley (R-Iowa) asked the firm’s co-founder, former Wall Street Journal reporter Glenn Simpson, to appear before his panel. Simpson does not plan to appear, POLITICO reported Thursday—but if he does, his testimony could be explosive.
In 2016, as Americans were consumed by the presidential campaign and Steele was compiling his famous dossier, the Kremlin was making a renewed push on Magnitsky, which included working to have his name removed from the Global Magnitsky Human Rights Accountability Act.
The Russian government’s tactics had grown more subtle since Congress passed the original Magnitsky act in 2012, according to a congressional aide who has followed the Kremlin campaign closely.
“As the years have gone by, they have gotten increasingly sophisticated,” the aide says. “They’ve learned from their mistakes. At first you had a Russia that would complain and threaten and then they realized the more you complain and threaten, the more you vindicate to Congress that they’ve struck a nerve.”
Last April, during a congressional delegation to Moscow, Russian senator Konstantin Kosachev slid California Rep. Dana Rohrabacher—widely known as the most Putin-friendly lawmaker on Capitol Hill—a note, asking if he’d be willing to meet with representatives from Russia’s general prosecutor’s office. Rohrabacher, along with aide Paul Behrends, agreed to the meeting, where he was given a document critical of Browder and Magnitsky.
The document, which was written in broken English, labeled “Confidential” and obtained by POLITICO Magazine, suggests that “the Subcommittee on Oversight and Investigations of the Committee of the House of Representatives” should investigate Browder. It also suggests that the U.S. should reconsider the Magnitsky law. “Such a situation could have a very favorable response from the Russian side on many key controversial issues and disagreements with the United States,” the document concludes, “including matters concerning the adoption procedure.”
Rohrabacher’s office casts its receipt of the document as simply a matter of hearing the Russian viewpoint. “He was asked if he wanted to take a document from prosecutors with interesting information and he took it,” his spokesman, Ken Grubbs, says. “The congressman doesn’t necessarily accept it. He just wants to know the other side.”
Also in April, a petition later linked to a Kremlin troll appeared on WhiteHouse.gov calling for the repeal of the original Magnitsky Act. Within a few weeks, the petition had gained 200,000 signatures, likely a result of Kremlin astroturfing, but failed to affect the Obama administration’s stance on the law.
Kremlin agents have also begun mimicking their nemesis’ tactics. “What they’re doing is they’re learning from Browder,” says the Hill aide. “Browder has been extremely media savvy.”
Browder first drew wide attention to the Magnitsky fraud with a low-budget YouTube video explaining it. More recently, Russian state TV has aired several documentaries critical of Browder.
As part of the campaign against the sanctions, Veselnitskaya was involved in promoting a controversial anti-Browder documentary, “The Magnitsky Act — Behind the Scenes,” and a June 13 screening of it at Washington’s Newseum—four days after her meeting with Trump Jr.
Around this time, Browder was publicly attacking an NBC News reporter over a planned story based on opposition research of him. NBC did not end up publishing a story.
But the Center for the National Interest, a Washington think tank that has been accused of being overly sympathetic to the Kremlin, published a blog post about the anti-Browder documentary that was heavily promoted by bots and search engine optimization techniques, according to the congressional aide who has monitored the anti-Magnitsky campaign. The headline—“What Really Killed Sergei Magnitsky?”—reads like it could have been ripped from Russian propaganda, which often seeks to cast doubt on Western reporting. In an angry reponse in the National Interest, a journal published by the center, Browder accused CNI of “recklessly disseminating the lies that the Kremlin is trying to spread around Washington.” (“We have no control over how others may seek to represent or publicize our work,” wrote CNI’s executive director Paul Saunders in an email.)
This was the backdrop for Veselnitskaya’s June 9 meeting at Trump Tower, which was arranged by Emin Agalarov, a Russian pop star friendly with the Trumps, and his publicist Rob Goldstone. The New York Times first reported the meeting last week.
In December, Congress passed the Global Magnitsky Act. The Russian effort to strip Magnitsky’s name from the law, despite support from Rohrabacher, failed.
Meanwhile, Veselnitskaya’s client continued to fight the U.S. government’s forfeiture case.
In October, the 2nd Circuit Court of Appeals barred BakerHostetler and John Moscow from representing Perezon, calling it a conflict of interest because, in 2008 and 2009, Moscow had represented Browder’s hedge fund, Hermitage Capital, in its initial investigate on of the Magnitsky fraud. (Moscow did not respond to an email requesting comment.)
On March 11, Trump fired Preet Bharara, the U.S. attorney overseeing the case, after initially indicating he would keep Bharara on in the job. On March 21, a key witness in the case against Perezon, a Russian lawyer representing Magnitsky’s family named Nikolai Gorokhov, was reportedlythrown out of a fourth-floor window in Moscow.
In April, Rohrabacher was overhead in a hotel lobby in Berlin discussing the case with Rinat Akhmetshin, a dual Russian-U.S. citizen who worked with Veselnitskaya to discredit Browder and is alleged to have ties with Russian intelligence, as CNN first reported.
On May 12, the case was settled on the eve of trial, with Prevezon paying $6 million. On Wednesday, House Democrats asked the Justice Department to explain the settlement.
As for the massive outlay of resources being marshaled against the Magnitsky Act and its leading proponent, Browder said he considers the Kremlin’s years-long campaign to discredit him ineffective, if annoying. “They’re not very good at it,“ he said, though, “It certainly takes up a lot of time.”