National security, never to be allowed back into russia again. At that point it became obvious to me that putins interests had diverged. Browders tax lawyer Sergei Magnitsky stayed behind to fight against the crimes committed by the kremlin and expose those responsible. It did not end well. So he was he was incarcerated for 358 days. And the tor and they tortured him and they tortured him. They chained him to a bed. And then eight riot guards with rubber batons came into that cell and beat him until he died. The chief executive officer of the Investment FundHermitage Capital management went on a mission to avenge his lawyers death. We knew who did it. We had all the evidence. Browder pressured the u. S. Congress to pass sanctions the magnitsky act to hold the russians accountable. And now he is working on a Global Version of the law. So to human rights violators from venezuela and kazakhstan and an anywhere. All bad guys should have a bad deal. They should all be scared of this stuff. The reallife russian thriller is an unlikely tale for the grandson of the communist party leader in the u. S. That is where we began our conversation when i met with bill browder in new york. You come from a family where your grandfather wasnt just a communist, he was possibly one of the biggest communists in america. Yes. So so my grandfather, earl browder was a Labor Union Organizer in wichita, kansas. And he was so good at organizing the union that in 1927 the International Communist party said, if you like labor unionism youre gonna love communism. Why dont you come to russia . So 1927 my grandfather goes to russia. He ends up meeting a russian girl who becomes my grandmother. My father is born there. And then five years later, in 1932, the communist party sends him back to america to become the general secretary of the america communist party. He runs for president in 1936 and 40 against roosevelt. Hes imprisoned by roosevelt in 41, pardoned the next year. And then ultimately kicked out of the communist party in 1945 for being too capitalist. And one wouldve thought that would be the end of the story. But then in the 1950s he was persecuted for being a communist. They did they didnt deter they didnt distinguish between good communists and right. Bad communists. What was your upbringing like . You have a highly educated family. Everybody in your family has really excelled in their fields. Well, so so so we yeah. I mean, if you come from a family of communists it just perm permeates everything. At the dinner table, you know, the discussion was how all business men were crooks who were ruining the world and so on and so forth. And so i w when i was going through my teenage rebellion in the 1970s i was looking for a good way to rebel from this family of communists. And and unfortunately i grew my hair into an afro. That didnt upset my my parents. But when i put on a suit and tie and became a capitalist, that really did. And so that was my my ultimate rebellion against my family. And i graduate Stanford Business school in 1989, the berlin wall comes down, and i had this epiphany, which was if my grandfather was the biggest communist in america, im gonna go become the biggest capitalist in eastern europe. And thats what i set out to do in 1989. You end up with the Boston Consulting Group. You end up in in london. And i dont know how you came about it, but there was some deal that needed consulting in poland. A bus company that under the communists was selling all of these buses to the government. And then all of a sudden th that business fell out from under them and you got sent to try and fix this. So so the Boston Consulting Group was hired by the world bank to go and fix a failing bus company in poland. They send me out to this little town with no experience. I dont know anything about buses or business, or anything for that matter. I get to this town i im supposed to be helping them fix the bus company. Its effectively unfixable unless the state started buying more buses, which they didnt. But while i was there i discovered something very interesting which was that my translator was carrying a newspaper. And in his newspaper i noticed a bunch of financial figures on the front page. And so i said, whats that . And he said, ah, these are the very first privatizations in poland. And he said, thats the share price that theyre gonna sell the shares at. And i said, well, whats that number below that . And he said, thats the number of shares outstanding of the company. And so i did the math. The shares outstanding times the share price got you to 80 million, which was the value of the company. And then i said, well, whats that number, right below there . And he said, that says, net profit for the last year. And that number was 160 million. So the val laugh they were selling the company for a value of 80 million and they had made 160 million the year before. Which which screams undervalued. Well, you dont have to be a stanford mba to know laugh that if you can buy a company for one half of their earnings, thats probably a good deal. And so i i was kind of excited by this whole thing that company wouldve paid for itself in six months. Exactly. So thats the other way to look at it. Yeah. So so so if you all you have to do is hold the shares for six months and theyve already yeah. Yeah. Made their money that you paid. This is in the postcommunist era. These Eastern European governments are now trying the get the private sector to invest in what used to be Government Health companies. Right. So they were they were privatizing government ho held companies. And and they didnt know how to do it. And then i decided to go all in that allin for me at that time was 2,000. That was my total life s that was your money. So you total life savings. Had it sent over to poland . And i bece a shareholder in the very first privatizations in poland for 2,000. And but what was most exciting about this whole experience was that after the whole assignment was done and everything was over my shares went up ten times. I made 20,000. And so i knew from that moment on that i wanted to be an investor in the privatizations of eastern europe. And thats what i set out to do. Now, youve written a great book about this. You figured out theres money to be made in eastern europe, youve figured out this privatization thing is interesting. You then figure out russia is the place to go. So you end up in russia. And similar things happen. Youre finding companies that are not well covered by analysts that are deeply, deeply undervalued and you start investing in those. Youve now raised money from other people as well. So i started an Investment Fund. So we fast forward a number of years. I go from my 2,000 to 20,000. I ended up raising 25 million for an Investment Fund called the hermitage fund. I move to moscow. Im the only wall streeteducated investor on the ground in moscow at the time. And the banker, edmond safra, is your partner at this point. Edmond safra, who was the owner of Republic National bank was my partner. If poland was cheap, russia was 50 times cheaper. Wow. It was remarkable. Russia in order to go from communism to capitalism boris yeltsin, who was the president of russia at the time, decided that the best way to do that was to do what they called mass privatization. To give everything away for free to the people. So the the math was pretty was was similarly crazy to the whole polish situation. They they issued vouchers to each person. 150 million vouchers. They traded for 20 each. So 20 times 150 million gets you to 3 billion of the vouchers. And that was exchangeable for 30 of all the shares of all russian companies. Which meant that the value of the entire russian economy was 10 billion. And so we started to just bet on the vouchers without knowing what the price was going to be. You were the most Successful Hedge Fund in the world. Probably in the history of the world. I was the most Successful Hedge Fund. I had more than 1 billion, which was a huge amount of money in any circumstance, but certainly back then, and in russia. In the middle of all this thing Vladimir Putin comes to power. Where did your interests align with Vladimir Putins . Well, so so what happened was so after all this going up 850 , 1 billion, et cetera, the market crashes. The market goes down 90 . I lose 900 million for my client. This is as a result of russia defaulting on its in 1998 1998 the market crashes, they default, they devalue, its all a complete disaster. And and at this point i im im in a very rough place because i need to make my money back for my investors. Im horrified, im humiliated. And and so i decide to try and stick it out and try to fight my way out of this hole for my clients. But what i discover is that the oligarchs, these the guys all these rich guys we all have heard about now they had a completely opposite set of incentives. They had been behaving themselves up until this point when russia defaulted in hopes of getting free money on wall street. Wall street closes for business. The russian oligarchs then say, well, why are we behaving ourselves. We might as well misbehave and steal because there theres no incentive to behave. So they misbehave. They start stealing. And theyre starts then they start doing asset stripping, transfer pricing, emb embezzlement dilutions. Everything you can think of, they were doing. And so i had to start to fight them to to save save my last ten cents on the dollar now youre youre fighting youre as a shareholder, a minority shareholder, fighting these companies the the leadership of these companies to get greater value out of the shares. Well, i im im just fighting them to stop stealing all the last money that they have that left in the company. It was a strange thing where Vladimir Putin the the oligarchs were stealing power from him. They were stealing money from me. And so every time that i would publicize a scandal about them i was going after his enemies. And and that suited him. And that suited him perfectly. We and so we weve never ive never had a conversation with Vladimir Putin. But i would publicize these things and and he would go around selectively crushing these guys based on my exposes. And so i had the most perfect life in the world fromabout 1999 to 2003 because there i was making a huge amount of money at this point. For this brief period of time, up until 2003, he was kind of not sure of where he where he was in the whole scenario. He goes out in 2003 in october of 2003 and arrests the richest man in russia, mikhail khodorkovsky, who was the owner of yukos, an oil company. He arrests him, he put him puts him on trial as you write, if youre the 17th richest guy in russia and youre watching the richest guy in russia in a cage on a televised trial what are you gonna do . Yeah, your first call is to Vladimir Putin. They say, vladimir, what do i have to do to make sure i dont sit in a cage . And i wasnt there, so im im just speculating here, but i can speculate based on what i have learned since, is he sai his answer was, 50 . Not 50 for the russian government, not 50 for the president ial administration of russia. 50 for Vladimir Putin. And at that moment in time fli the Vladimir Putin becomes the richest man in the world. And h how do you corroborate that . Well, and so we i i can i can corroborate it now by by just going onto the u. S. Treasury website. And some of the biggest oligarchs in russia theyre sanctioning for being a trustee and Holding Money for Vladimir Putin. I was, at one point, a big ally of Vladimir Putin. And after this whole thing happens, and as i continue to do exposes of corruption, im no longer exposing his enemies. Im exposing his own personal financial interests. And and on november 13th, 2005, as i was flying back to russia, having lived there for ten years, become the largest foreign investor in their country i was stopped at the vip lounge of sheremetyevo airport. I was locked up overnight. And then i was deported the next day and declared a threat to national security, never to be allowed back into russia again. At that point it became obvious to me that putins interests had diverged. Then things get go horribly wrong. The the the russian government goes after you. And they start going after some of your aides and all that. And you slowly manage to divest your interests your your investors interests. You get your money out, which is great. And you get your staff out, in most cases. And you leave a few key people in russia who are not your employees, but theyre working on your your behalf. They are mostly lawyers. And one in particular was handling your your tax affairs, the fact that the government had accused you of of tax fraud. What happens then . So so my offices get raided in june of 2007. The police are specifically looking for our stamps, seals, and certificates for our Investment Holding companies. They find them at the law firm. They seize those. And the next thing we know we no longer own our Investment Holding companies. Theyd been and by law somebody had used these stamps, seals, and certificates and transferred ownership of the company. They transferred ownership legally. Of the company illegally, but legally. They they u using all of the documents i was terrified because if the police were involved in in opening criminal cases and seizing documents and working with murderers, god knows what they could do next. And so i hired a bunch of lawyers, including a young man named Sergei Magnitsky. Sergei was a tax lawyer working for an American Law Firm in moscow. And he went out and he investigated what this was all about. We discovered, with sergeis great investigating skills, that the purpose of this of this whole thing was to steal n not they tried to steal our money. They didnt succeed. But the purpose was to steal 230 million of taxes that we paid to the russian government, from the russian government. And they succeeded in that. So government officials stole our companies, applied for a tax refund of 230 million tax you had already paid. Tax we already paid. So we discovered this. We and and and then the the moment that and we thought this is not just a threat from us. This is a theft from the russian government. And so we thought lets file a criminal complaint. And so we got all of our lawyers, including sergei, to draft criminal complaints. We filed them with all the different Law Enforcement agencies of russia. And then we waited for the good guys to get bad guys. And it turns out there were no good guys over there, just bad guys. And they opened up criminal cases against all of our lawyers. It turns out our lawyers were in harms way. And so i went to every lawyer and i said, you gotta leave russia. But sergei who is about ten years younger than the other guys and hadnt been sort of fully aware of the how horrible the soviet system was, he he was an idealist. He was young, hopeful. He thought this was the new russia. Right. And he said he said this he said specifically, this is not 1937. Which is the year that stalin did his purges. You know, the the law ive not done anything wrong. The law will protect me. He stayed in russia and he testified against the Police Officers who were involved in this raid. And then the same Police Officers he testified against, one month later, came to his home at 8 00 in the morning in front of his wife and two children, arrested him, put him in pretrial detention. And then began to to he he then began to be tortured to get him to withdraw his testimony against these Police Officers. He was tortured, he was moved from jail to jail. He became ill. They denied him treatment. And hes a lawyer. Hes writing real documents. Hes writing real requests. So he was he was incarcerated for 358 days. And the tor and they tortured him and they tortured him. He ended up getting sick. He lost 40 pounds. He developed pancreatitis and gall stones. He needed an operation. They kept on coming to him saying, if you sign a false confession saying you stole the 230 million and you did s and and and you did so at at at my instruction, then everything will be okay. Even with gall stones. And he refused to sign their false confession. And so as a result they they moved him to a prison without any medical facilities and and and eventually his body could no longer tolerate it. And on the night of november 16th, 2009 he went into critical condition. On that night they then moved him from a prison that had a medical facility a prison that that didnt have a medical facility to a prison that did in an ambulance. When he arrived at the new prison instead of putting him in the emergency room they put him in an isolation cell. They chained him to a bed. And then eight riot guards with rubber batons came into that cell and beat him until he died. He was 37 years old. That was november 16th, 2009. And its visceral to read. You were in london. Your wife took the call. And you you said you just you were like an animal. He was plucked out of his middle class life, put into the worst hellhole dungeon you could ever imagine and then slowly and sadistically tortured to death because he worked for me. And for me that was just its the most horrifying, souldestroying, heartbreaking thing that could ever happen. And and i i was so upset. When i finally regained my composure i i said to myself that i was gonna do everything in my power to get justice for Sergei Magnitsky. And and for the last six years thats what ive been doing. Youre watching talk to al jazeera, coming up bill browder and his murdered lawyer Sergei Magnitsky were both put on trial in russia. That story just ahead stay with us. Inside story takes you beyond the headlines, beyond the quick cuts, beyond the soundbites. Were giving you a deeper dive into the stories that are making our world what it is. Im ali velshi and youre watching talk to al jazeera. My guest this week is bill browder. He was once a highflying financier in russia. Then when his lawyer was tortured and killed for working to expose corruption browder became a human rights activist. Somehow you focused and the idea that if the United States were to impose sanctions on certain people in power, certain wealthy people, or people of influence, that would be a good way a good road to go down. He wrote he he wrote during his time in in detention 450 complaints in his 358 days in detention. So we had this incredible, unprecedented testimony from the grave of what they did to him. And it was un never in in in the history of human rights abuse has there been such a welldocumented case. And so we we too this testimony and and we figured that if we publicized it and and filed it in courts and so on, that the russians, you know, no matter how corrupt they were, that putin would have to at least let the midlevel guys go. Hed have to, like, put throw them under the bus. But he didnt. Know what i mean . It was just i mean, they they just lied blatantly. But it was it was obvious from the autop autopsy photos. Everything was obvious. And we knew who did it. We had all the evidence. And they decided to just completely circle the wagons, cover it up, and and exonerate every Single Person involved. Putin did, personally. I said to myself well, how do we get justice outside of russia . And i discovered something really terrible about the world, which is that if if Something Like this happens there are no mechanisms of international justice. The best thing you can do is go to the state department and if theyre if theyre willing theyll write, like a sentence, or maybe two sentences in in a report to say that theyre not so happy with how russia behaved in this situation. And ironically, they werent all that happy to help you when you first went to the state department. Because at that time president obama had been elected. And part of his platform and part of what he did wanted to do on the world when he with the world when he came into office was this reset with russia. And so i looked at this whole crime and i said to myself this was not a crime of ideology. This was not a crime of religion. This was a crime of money. This was a crime they killed Sergei Magnitsky to steal 230 million. And those people who stole that 230 million, they dont keep that money in russia. Because as easily as they stole it, somebody could take it from them. And so where do they keep it . They keep it in new york. They keep it in london. They keep it in france and germany. And so it it it became obvious to me that that their big their their they like to steal in russia and then keep their money in the west. And so i went to washington after sergei was killed. And i went to two senators, senator benjamin cardin, whos a democrat from maryland, and senator john mccain, whos a republican from arizona. And i told them the story that ive just told with you here now. And and i said, can we take away their visas and freeze their assets and make a law . And they said yes. And so they came up and this was a bi this was one of the few things in in a polarized washington that that the democrats and the republicans could agree on. And they came up with something called the magnitsky act, named after Sergei Magnitsky, my lawyer who was killed. They came up with it in in october of 2010. And and and they introduced it to congress. And it was very interesting. Because right afterwards their phone lines lit up. They were getting telephone calls from many, many russian victims of other crimes. And those people said, you know, the the can you sanction the person that killed my father . You know, can you sanction the person that killed my husband, my sister, my brother . They and they realized that they were on to something much bigger than just Sergei Magnitsky. Theyd found the achilles heel of the putin regime. And so after about ten of these calls they said, well, this has gotta be bigger than Sergei Magnitsky. And they added 65 words to the law to sanction all other gross human rights abusers in russia. And from that moment the thing just snowballed. And we ended up with 39 senate cosponsors. In december of 2012 Vladimir Putin held a press conference in which again, it came up again. Sergei magnitsky. Reporters asked him about it and he said, magnitsky did not die of torture. He was not tortured. He died of a heart attack. In addition, as you know, he was not a human rights activist, but a lawyer for mr. Browder, who is suspected by our Law Enforcement agencies of Economic Crimes in russia. You had made yourself into public enemy number one in russia. Well, what happened was the magnitsky act passed 92 to four in the senate. 89 of the house of representatives. Signed by president obama on december 14th, 2012. You think a little grudgingly. He he it was very grudging. We we had to fight tooth and nail. And so, putin went crazy. They tried you in court, along with Sergei Magnitsky, who was dead. A trial three years after they killed Sergei Magnitsky, putting him in trial as a dead man. Now, i i this has never happened in the history of russia. I mean, russia has had a terrible history. Even stalin didnt try dead people. But putin was so upset about this magnitsky act that he wanted to to defame Sergei Magnitsky. And so they put him on trial. They found him guilty. They found me guilty. They sentenced me to nine years, in absentia, in a russian prison. This is talk to al jazeera, more with bill browder in a minute. Youre watching talk to al jazeera im ali velshi. My guest this week is bill browder the ceo of Hermitage Capital management and human rights campaigner. You write about how you had sergeis wife and and son in the European Parliament when the europeans passed sanctions. Where does this go from from here . Are are you working harder to get more sanctions on russia . My goal is to take the tragedy of what happened to sergei and try to turn it into something positive. And and we have sanctions to punish the russians in america. We want the same sanctions in europe, which is why were working with the European Parliament. And and i think im most proud of the fact that the senators in america who passed the russian magnitsky act have reintroduced a new law called the global magnitsky act, named after Sergei Magnitsky, which would apply sanctions globally. So to human rights violators from venezuela and kazakhstan and an anywhere. Because theres no reason why bad guys from russia should have a worse deal than bad guys everyone should have a ba all bad guys should have a bad deal. They should all be scared of this stuff. Nothings gonna bring back Sergei Magnitsky. But but this does leave him with a legacy an important legacy of of hopefully saving lots of other lives around the world. Bill browder, thank you so much for your time. Thank you. Appreciate it. Every monday night. I lived that character. Go one on one with americas movers and shakers. We will be able to see change. Gripping. Inspiring. Entertaining. Talk to al jazeera. Monday, 6 00 eastern. Only on al jazeera america. Kurdish forces say they have taken control of the town of sinjar from i. S. I. L. Fighters. This is al jazeera live. Aung san suu kyis n. L. D. Wins the majority in myanmars election. The u. N. Security Council Passes a resolution condemning the ongoing violence in burundi plus. Reporter im reporting from south