February 18th, 2012

Erik Schatzker: Corruption, conspiracy, theft and blackmail sounds like an episode of the Soprano’s, but this is the reality of the legal system in Russia. So says our next guest who spent 18 years helping US companies navigate Russia’s legal system. He fled Moscow in March because he feared being the next target of what he calls, “Russia’s mafia police.” Jamie Firestone is the co-founder and managing partner of Firestone Duncan, and he joins us now from London. Jamie, I have to ask you, this stuff sounds frankly, kinda disbelievable. Tell us a little bit about your experience in Russia recently as it concerns your partner, who’s dead, and the threats that you feel you face.

J Firestone: Sure. My experience can be explained as follows. In June of 2007, my law office was raided by a bunch of Ministry of Interior officers, police officers, with a search warrant, and they took a bunch of documents pertaining to my client’s company, Hermitage Capital. Now, within a matter of months all of the documents and seals that were in possession of the officers were used to change the managing director of the Hermitage Companies to a convicted criminal by the name of Viktor Markelov. Now it so happens that the very officers who raided my office had been accused in the Russian courts of working with this one criminal to kidnap and extort people. So all of a sudden my client realized “My companies have been stolen by the police, registered to a criminal, and something bad is going to happen.” So my client and my partner filed complaints with the Russian Prosecutor’s Office saying that this has happened, help us. And the Prosecutor’s Office didn’t do anything, and the companies were then used to basically steal all the taxes back from the Government that my client had paid, 230 million US dollars.

J Firestone: My partner, Sergei Magnitsky, complained about this and within months of complaining he was … He testified against the officers who did this and said they were obviously involved in this fraud because they had seized the documents and registered the company to a criminal that they had been working with and stolen 230 million. He testified about this, the same officers arrested him at seven o’clock in the morning basically. And the next thing you knew, he was in prison that evening. He was in prison for 11 months, tortured in prison and he died in prison.

Deirdre Bolton: Jamie?

J Firestone: So if that … yes.

Deirdre Bolton: I don’t wanna cut you off, but I mean this sounds so horrific, aren’t you fearful for your life? I mean, why aren’t you in hiding?

J Firestone: Well, yes. Well, I’m not in hiding. I’m in plain sight because I’m protesting this. What happened to me and how I ended up getting personally dragged into all of this, is that I manage one of my client’s companies in Russia and they’re a large international fund, and one day the same thing … I open my mailbox and I find out that somebody … I received an envelope, and in the envelope are a bunch of documents showing that somebody has applied for a 21 million dollar refund, tax refund, forging my signature, and essentially somebody went through a lot of trouble to make it look like I’m trying to take 21 million dollars from the Russian Government. So I realized at that point where this is coming from, that I’ve been a little too loud in protesting police corruption and now the police have a present for me, so to speak.

J Firestone: So what I’ve done is I’ve come to London right now where I can expose this, but not have to worry about being arrested in the morning like my partner was, dragged off to prison and killed.

Erik Schatzker: Jamie, we only have about 30, 40 seconds left. You’re an American, you’re a graduate of Tulane University, Tulane Law School down in New Orleans. Do you feel like you’re getting enough support from the US Government, and what does this really mean in the context of US Russia relations?

J Firestone: I’ve been getting a lot of support from the US Government. I think the real issue is that the Russian law enforcement system is broken, and it’s so corrupt that even the US Government has a hard time making headway with them.

Deirdre Bolton: Jamie, we wish you luck. Thank you very much for joining us.