By Jason Bush
MOSCOW, Nov 16 (Reuters Breakingviews) - Sergei Magnitsky, a lawyer for hedge fund Hermitage Capital, died a year ago in custody, sparking international outrage. Now the Russian police posthumously accuse him of orchestrating the ${esc.dollar}230 million fraud he unearthed. Russia's corruption culture is alive and well.
A considered view will be published shortly.
CONTEXT NEWS
-- Nov. 16 marked the first anniversary of the death in prison of Sergei Magnitsky, a tax lawyer at law firm Firestone Duncan in Moscow, who advised British hedge fund Hermitage Capital Management, managed by American-born investor William Browder. The European Commission in October called the case "an important litmus test of whether President Medvedev is serious in his recent calls for modernisation and rule-of-law in Russia."
-- Officials of Russia's Interior Ministry held a press conference on Nov. 15 to outline their version of a ${esc.dollar}230 million tax rebate fraud that is central to the case. A ministry spokeswoman stated that two suspects in the fraud, Vyacheslav Khlebnikov and Viktor Markelo, testified that they acted in collaboration with Magnitsky. She said that police suspect Magnitsky of preparing the documents used by the fraudsters.
-- Hermitage issued a statement calling the new allegations against Magnitsky "absurd and cynical". It also released copies of letters written in 2007 by Hermitage's lawyer, and Hermitage's trustee, HSBC Management Ltd, to top Russian law enforcement officials, as well as the official replies. Hermitage said that these represented "proof that three major law enforcement agencies in Russia were fully aware of the ongoing crime to steal ${esc.dollar}230 million three weeks before the crime took place and they did nothing to stop it."
-- On Nov. 12, international anti-corruption watchdog Transparency International posthumously awarded Magnitsky one of its annual Integrity Awards. On Oct. 26, Transparency International published its annual ranking of corruption perception by country. In terms of transparency, Russia fell from 146th to 154th place, out of 178 countries, placing it on par with Congo, Laos and Papua New Guinea.
-- The author is a Reuters Breakingviews columnist. The opinions expressed are his own --
-- For previous columns by the author, Reuters customers can click on [BUSH/]
(Editing by Pierre Brian??on and Sarah Bailey)
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