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David Calling

The David Pryce-Jones blog.

Oligarchs in London



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The High Court in London is offering a fascinating insight into Russian reality. Boris Berezovsky, one of the richest Russian oligarchs and now resident in London, is suing Roman Abramovich, another of the richest Russian oligarchs and also resident in London. $6 billion seems to be at stake.

The case goes back to the unholy scramble to lay hands on state assets after the collapse of Soviet Communism. Boris Yeltsin was in the Kremlin and those who knew the ropes carved up whole industries and took them over; robber barons on an unprecedented scale. A report in the London Times describes Abramovich as “an uneducated mechanic” who once needed Berezovsky to introduce him to banks and provide “political patronage,” the euphemism covering who exactly had to be bribed, and how this was to be done. Berezovsky also alleges breach of trust and of contract. Trust? Contract?

After the collapse of Communism, as one of the lawyers explained in the British judge, ”There was no rule of law. The police were corrupt. The courts were unpredictable at best — at worst open to manipulation. Nobody could go into business without access to political power. If you didn’t have access to political power you needed access to a godfather who did.” According to the London Times, Berezovsky had indeed been “indispensable” in helping the uneducated mechanic to acquire an oil company from the Russian state “in a corrupt auction.” In return he had received $2 billion. This was not a fee, even less a dividend, just a gratuity. Yes, that is the word the lawyers used for this sum. “Libel tourism” is a well-known scandal whereby foreigners find a pretext to get damages under British law for libel committed in some other country. Legal tourism for oligarchs is a novelty.

Vladimir Putin emerged fully-fledged from these swamps. He doesn’t bother with the London courts. On the contrary, he protected one Lugovoi from extradition and trial on suspicion of murdering Litvinenko in London on behalf of the Kremlin. He simply has his opponents put away in Siberia. Time was when Mikhail Khodorkovsky was as rich as any Russian oligarch, and in the Kremlin godfather business too. Putin had no trouble sending him to prison for eight years on charges of financial irregularity, further extending the sentence by seven more. Khodorkovsky has just published a book with reflections on prison and on Russia, concluding: “Until Russia has independent courts, it will not have freedom.” There is no foreseeable chance of that. When the Soviet Union collapsed, General Shebarshin, head of the First Division of the KGB, told me in an interview that the weight of Russia one day would be enough to reconstruct the lost Communist empire. Today’s proposal of a Eurasian Union is Putin’s attempt to regroup under Russian control as many former Soviet republics and countries as possible. “We have a great inheritance from the Soviet Union,” an Izvestia article written in his name has just proclaimed. Didn’t someone say that those who do not learn the lessons of history are condemned to repeat their mistakes?



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