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Originally published July 11, 2013 at 6:14 PM | Page modified July 11, 2013 at 9:36 PM

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No problem that he’s dead: Kremlin critic convicted

A judge finds Russian whistle-blower Sergei Magnitsky, who died in 2009, guilty of tax evasion, bringing an end to an unusual, posthumous trial that drew international condemnation and eroded U.S.-Russian relations.

The New York Times

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MOSCOW —

The steel cage reserved for the defendants was empty Thursday, not surprising since one is dead and the other lives in London. As the judge, his voice nearly inaudible, read his verdict, one of the main defense lawyers paid no attention, tapping nonchalantly on his tablet computer instead.

If the posthumous prosecution of Sergei Magnitsky — a lawyer jailed as he tried to expose government tax fraud and who died in prison after being denied proper medical care — seemed surreal from the moment the authorities announced it, the verdict and sentencing Thursday did not disappoint.

By all accounts, it was Russia’s first trial of a dead man and in the tiny third-floor courtroom of the Tverskoi District Court, it took the judge, Igor Alisov, more than an hour and a half to read his decision pronouncing Magnitsky guilty of tax evasion.

Magnitsky was convicted along with a former client, William Browder, a financier who lives in Britain and was tried in absentia on the same charges. Browder, chief executive and co-founder of the investment fund Hermitage Capital Management, and once Russia’s largest foreign-portfolio investor, was sentenced to nine years in prison, a sentence he will almost certainly never serve.

Interpol in late May refused a request by the Russian government to track Browder’s whereabouts, a relatively rare instance of a law-enforcement agency’s inquiry being set aside as politically motivated.

Browder, who was born and raised in the U.S. but became a British citizen, has been barred from Russia since 2005. He said in a telephone interview from London on Thursday that he believed the Kremlin was acting out of desperation.

“Russia is a criminal regime,” Browder said. “The Russian state is a criminal state. And in order to operate in Russia, you have two options as a businessman: You can become part of the criminality, in which case you become a criminal, or you can oppose it, in which case you become a victim, and there’s no way you can avoid it.”

He added: “We exposed it and opposed it. And as a result, he is dead and I am sentenced to nine years in absentia.”

Magnitsky’s death in 2009 — and the Kremlin’s refusal to hold anyone responsible for either his treatment in prison or the fraud he tried to expose — has drawn international condemnation. It also set off a major diplomatic dispute with the United States, which last year adopted a bill named after him that bars Russian citizens accused of human-rights abuses from traveling to the United States or maintaining financial assets there.

Russia retaliated by approving a law putting reciprocal restrictions on Americans accused of rights abuses and barring the adoption of Russian orphans by U.S. citizens.

The proceedings on Thursday began about noon. The courtroom was filled with 22 video cameras and dozens of reporters; six guards; four officials from the prosecution; and two court-appointed defense lawyers. Absent any defendants to prevent from escaping, the guards eyed reporters and camera crews warily.

Alisov could barely be heard as he read his decision and rarely looked up, though he frequently repositioned his spectacles.

Despite the long recitation of facts and history, the result was simple: Magnitsky and Browder had been found guilty of large-scale tax evasion stemming from a scheme in which they fraudulently claimed benefits available to companies that employed workers with disabilities.

The case began in 2008, when Magnitsky publicly alleged that a group of law-enforcement, security and tax officials had taken part in a complex tax conspiracy. As part of the scheme, he alleged, Hermitage Capital Management was improperly accused of tax evasion. Then, he said, the officials allegedly used Hermitage documents obtained during their investigation to funnel $230 million in tax refunds to associates at affiliated companies. The money was then allegedly channeled to overseas accounts.

In response to the accusations, authorities arrested Magnitsky for tax evasion.

He died in pretrial detention nearly a year after his arrest. While in custody he had received diagnoses of pancreatitis and gallbladder disease, and wrote repeated requests for medical treatment, which were refused.

Authorities ruled that he had died of toxic shock and heart failure. One prison official was brought to trial in Magnitsky’s death, but in a last-minute twist, prosecutors switched their view and urged an acquittal.

Browder and Magnitsky’s family refused to participate in the case, and the government was forced to appoint lawyers for both. Neither lawyer said a word during proceedings Thursday.

There was no immediate comment from the Kremlin on the verdict.

After announcing the guilty verdicts, Alisov said the case against Magnitsky had been dismissed because of his death, presumably to explain why the judge was not announcing any sentence.

At one point, a Moscow court ruled that the criminal case against Magnitsky was legal, even though he was dead, because his mother had insisted that her son was innocent in interviews with the news media.

Material from the Los Angeles Times is included in this report.

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