Red Notice: A True Story of High Finance, Murder, and One Man's Fight for Justice (29 page)

“Who owns Pluton?” I asked.

“A man named Viktor Markelov, who, according to the criminal records database, was convicted for manslaughter in 2001.”

“Unbelievable!” I exclaimed. “So the police raid our offices, seize a ton of documents, and then use a convicted killer to fraudulently reregister our companies?”

“That’s exactly what happened,” Sergei said. “And it gets worse. Those documents were then used to forge a bunch of backdated contracts that claim your stolen company owes seventy-one million dollars to an empty shell company that you never did any business with.”

“My God,” I said.

“Wait. It gets
even
worse. Those forged contracts were taken to court, and a lawyer who you didn’t hire showed up to defend your companies. As soon as the case started, he pleaded guilty to seventy-one million dollars in liabilities.”

As rotten and incomprehensible as this was, everything now made sense. As the story crystallized in front of my eyes, I started laughing.
At first a little, then loudly. There was nothing funny about what was going on, but I was laughing out of sheer relief. At first everyone else was silent, but then Ivan joined me, followed by Vadim.

We now knew exactly what they were up to, and they had completely failed. They wanted the Hermitage money, but none of it was there. Based on the published price list of corporate raiding, these guys had spent millions bribing judges, cops, and clerks only to get nothing.

The only person who didn’t laugh was Sergei. “Don’t relax, Bill,” he said ominously over the speakerphone. “This is not the end of the story.”

“What do you mean?” Vadim asked.

“I don’t know,” Sergei answered, his phone line crackling slightly. “But Russian stories never have happy endings.”

We could have walked away from the situation right then and there. Except for one big wrinkle: a criminal case was still open against Ivan.

We decided the best way to defend Ivan was to go after Kuznetsov and Karpov, both of whom were obviously involved in both Ivan’s case and the theft of our companies. To do that, we decided to file criminal complaints against them with the Russian authorities. Because our legal team was so stretched, we brought in Vladimir Pastukhov, the lawyer who had urged Vadim to flee Russia in 2006, to help out.

He came to London and installed himself in the conference room of our new offices. With the successful launch of Hermitage Global, we had moved into a newly refurbished building on Golden Square, just behind Piccadilly Circus, and were no longer crammed together in a warren of serviced offices in Covent Garden.

Vladimir surrounded himself with our files, and over several days interviewed each of us. He then started drafting a long complaint about the theft of our companies and the creation of these huge fake liabilities. A special section described the fraud’s reliance on the documents and electronic files that were seized during the police raids led by Kuznetsov and which Karpov kept in his custody.

While Vladimir was working on offense, Eduard was in Russia working on defense. For five months he’d been trying to get the relevant parts of the case file on Ivan to prepare his defense, and for five months Major Karpov had steadfastly refused to hand them over.
Eduard had been filing complaints with prosecutors and Karpov’s superiors, but they’d achieved nothing. With every refusal his frustration mounted. It wasn’t just professional for Eduard, it was starting to get personal.

But then, on November 29, Eduard received an unexpected call from Karpov, who said that he was finally willing to provide some of the documents that Eduard had been requesting for months. Eduard cleared his schedule and rushed to the Moscow Interior Ministry headquarters on Novoslobodskaya Ulitsa. Karpov met him at the entrance, and when they reached his small office, Karpov waved his hand toward an empty seat.

Eduard sat.

“I know you’ve been asking for the Cherkasov documents, and I’m prepared to share some of them with you today,” Karpov said with a magnanimous smirk.

Eduard regarded Karpov with a mix of exasperation and contempt. “You should have given them to me a long time ago.”

“Whatever. I’m giving them to you now. Be grateful.” Karpov then stood, took a ten-inch stack of paper in both hands, walked to the other side of his desk, and plonked them in front of Eduard. “There’s one thing, however. The copier is broken, so if you want any copies, you’ll have to do them by hand.”

Eduard is normally dispassionate and professional, but here was a thirty-year-old police officer strutting around in a $3,000 Italian suit, with an expensive watch and manicured nails, taunting Eduard like a high school bully. After five months of trying to get this information, this behavior was simply too much for Eduard. He’d been an Interior Ministry investigator himself and had never treated anyone this way.

Eduard was so frustrated that he shouted, “I don’t know what you think you’re doing! We’ve caught you. We know everything about what happened in Saint Petersburg!”

Karpov turned white. “W-what? What happened in Saint Petersburg?” he stammered, playing dumb.

“We have all the evidence. The documents in your custody were
used to steal three companies and create huge fake liabilities. As a criminal lawyer, I can tell you that this will be an easy case to prove.”

Karpov crossed his arms and leaned forward, his eyes darting around the room. After several seconds he motioned for Eduard to come to his side of the desk. Eduard did so. Without saying a word, Karpov started typing furiously into his laptop, apparently thinking that his office was bugged.

After Karpov finished, Eduard leaned forward to read the message.
It wasn’t me. This is Kuznetsov’s project.

Karpov then deleted everything on the screen.

In seconds, Karpov had gone from being arrogant to submissive, and he even selected some of the more important documents from Ivan’s file for Eduard to copy.

Eduard wasn’t sure what to make of this turn of events, but he wasn’t going to miss this opportunity to get the documents for Ivan. He furiously hand-copied the papers, but then had to stop when Karpov announced he had to leave for another meeting. Karpov took the unusual step of escorting Eduard to the front door of the building and even continued walking with him to his car. Karpov seemed to be hoping that Eduard would say something more about what we knew as they walked.

Once Eduard got into his car, he realized that he had just made a big mistake. We hadn’t authorized him to talk about our discoveries with anybody. By losing his cool, he’d let the bad guys know that we were onto them.

After regaining his composure, Eduard called London to tell us what happened. It was definitely a mistake, but given how obstinate Karpov had been, I could hardly be angry with Eduard. After apologizing, Eduard advised us that we needed to file our complaints as soon as possible since our secret was out. When I asked Vladimir how much more time he needed, he told me, “Four days,” which meant Monday, December 3, 2007.

Meanwhile, I had to go to Geneva for a client lunch on November 30. With everything that was going on, I would have preferred to stay
in London, but the meeting was too important to cancel. I flew out in the morning and returned the same evening to London City Airport. As my taxi wound its way through the back streets of Canary Wharf on my way home, my secretary called with my messages.

She took me through the list and at the end said, “Someone named Igor Sagiryan called for you. Would you like me to get him on the line now?”

“Sagiryan?” I searched my memory. I knew that name. As I looked through my contacts in my BlackBerry, I remembered that he was one of the main guys at Renaissance Capital, the same firm that Boris Jordan ran when I was fighting Sidanco. I’d met Sagiryan only once, at an investment conference a few years earlier, so I wondered why he was trying to reach me.

“Sure. I’ll talk to him.”

She called him up and put him through. “Igor. Bill Browder here. How are you?”

“I’m okay, as much as one could be okay these days. Listen, when are you going to be in London? I want to see you and have a short meeting, preferably face-to-face rather than over the phone.”

This was a strange request. I barely knew the guy and he was proposing to fly from Moscow to meet with me. “Sure. What’s up?”

“Not much, but as you know, everybody is under certain pressures, so I just wanted to discuss with you what other steps we can take because we are working a lot with you, so I mean we’re now having some small difficulties, but it’s better to have none.”

His answer made no sense. I had no idea what “pressures” and “small difficulties” he was referring to and began to suspect this had something to do with Eduard’s meeting with Karpov.

“Is there anything specific you want to talk about right now?”

“Well, the question is that honestly I’m on a mobile phone. You are a lucky guy, you live in the UK, but I’m in Russia and I would prefer to meet in person.”

Something unusual was going on. Perhaps Sagiryan was trying to deliver a message from the bad guys or negotiate with me on their
behalf. Whatever his agenda was, his request didn’t seem coincidental, so I agreed to meet him at the Dorchester Hotel on December 11, which was right after I returned from a business trip to the Middle East that I was embarking on the next day.

I flew to Saudi Arabia the next morning, and the following Monday our legal team filed our 244-page criminal complaints with the Russian authorities. Two copies went to the general prosecutor (Russia’s attorney general); two to the head of the State Investigative Committee (Russia’s FBI); and two to the head of the Internal Affairs Department of the Interior Ministry.

I expected to see a reaction to these complaints sometime after the New Year, but two days later, as I was walking through the lobby of the Four Seasons in Riyadh, I got a call from an agitated Jamison Firestone, who was still in Moscow. “Bill, are you on a clear line?”

“What?”

“Is your phone safe?”

“I have no idea. I’m in Saudi Arabia. Why?”

“I just had the strangest meeting with a guy named Igor Sagiryan.”

“Sagiryan?”

“Yeah. He’s the president of Renaissance Capital—”

“I know who he is. Why did he call you?”

“He wanted to talk about
you
, Bill.”

“What?”

“It was weird. He knew everything about your situation. When I went to his office, he had a stack of papers on his desk about you. He picked up a sheet and made a strange gesture showing that the situation was serious. He said that the people involved are very bad. The kind who hurt people. Guys with criminal records.”

“What did he want?” I asked.

“That’s the interesting part. He wanted me to convince you to allow Renaissance to liquidate your stolen companies.”

“Liquidate our stolen companies? That’s absurd. Why would he want to do that?
How
would he do that?”

“I have no idea. I don’t understand how liquidating these things
would help Ivan. Besides, how could Sagiryan liquidate something he doesn’t control?”

We hung up. This development was very odd indeed. Where did Sagiryan get this information? It certainly hadn’t been from us. This meant that my upcoming meeting with him might be a crucial opportunity to learn more about what our enemies were up to.

I hastened to finish my business in the Middle East. When I returned to London, I prepared for my meeting with Ivan and Vadim. If possible, I wanted to catch Sagiryan off guard.

It was also essential to record our conversation so that we could analyze every word he said. Two days before the meeting, I called Steven Beck, a former British Special Forces officer and security specialist whom I used for these kinds of situations. He came to the office with two surveillance specialists. One of them asked for my cashmere blazer. I reluctantly handed it to him and cringed as I watched him roughly cut the seam of the lapel, insert a microphone, and sew it back up. He then ran a wire through the jacket into my left-hand pocket, where he placed a slim digital recorder.

This is what I would use to record the meeting with Sagiryan.

The day of the meeting arrived. I left our offices on Golden Square, hopped into a black taxi, and turned on the recording device as we pulled away from the curb. I was a ball of nerves. I was about to go face-to-face with someone I suspected to be connected to a major criminal conspiracy. I’d confronted countless financial crooks and other rogues in my business dealings, but never in my life had I walked willingly into such a potentially dangerous and hostile situation. It took every ounce of effort for me to keep my cool.

The taxi arrived at the Dorchester Hotel on Park Lane and pulled into the triangular driveway between a silver Bentley and a red Ferrari. These were not out of place given the ostentatious nature of the Russian oligarchs and Middle Eastern sheikhs who favored the hotel. I was early. I went inside and settled into an olive-green armchair in the lobby, scanning the room with its red marble columns and matching drapes, trying to pick Sagiryan out of the crowd. At
about 7:10 p.m., he rushed in, looking as if he were late for a normal business meeting. Taller than me, Sagiryan was a fifty-five-year-old businessman with gray hair, jowly cheeks, and a soft double chin that ran straight into his neck. He looked like an indulgent grandfather, not someone I suspected of having been involved in our troubles in Russia.

For a while we made small talk about London, the weather, Moscow, and politics, dancing around the real reason we were here. Finally, I asked what was so important that he was ready to come all the way to England to see me.

He took a breath and told me how Renaissance had been recently raided by the police. He claimed the raid had happened because Renaissance had done business with us. He repeated what he said to Jamison, proposing that if I allowed him to liquidate Hermitage’s stolen companies, it would somehow solve all of the problems that he and Renaissance were having.