Deception

by Edward Lucas

  INTRODUCTION

  1 Miss Fire: The Chronicle of a British Mission to Mihailovich 1943 – 1944 by Jasper Rootham (Chatto & Windus, 1946). Petar. A King’s Heritage; The Memoirs of King Peter II of Yugoslavia (Cassell,1955). Three Yugoslav-centred books that shaped my childhood are Lawrence Durrell’s neglected classic spy novel, White Eagles over Serbia (Faber & Faber,1957); the masterly ‘Sword of Honour’ trilogy by Evelyn Waugh (Chapman and Hall, 1955, 1951 and 1961); and Rebecca West’s Black Lamb and Grey Falcon (Macmillan,1941).

  2 Smiley’s People by John le Carré (Hodder and Stoughton, 1980). Colonel Alfons Rebane, the Estonian officer who played a leading role in SIS’s Operation Jungle, was the model for le Carré’s ‘General Vladimir’, an Estonian émigré whose murder brings George Smiley back into the spy world.

  3 See for example this report on the suicide of Nikolai Kruchina: ‘Soviet Turmoil; New Suicide: Budget Director’, New York Times, 27 August 1991 http://www.nytimes.com/1991/08/27/world/soviet-turmoil-new-suicide-budget-director.html and also ‘Desperately Seeking Rubles’ by Susan Tifft and Yuri Zarakhovich, Time, 4 November 1991 www.time.com/time/magazine/article/0,9171,974181–1,00.html

  4 The Cheka (formally the Vserossiyskaya Chrezvychaynaya Komissiya or All-Russian Extraordinary Commission) was itself in some senses a successor to the Tsarist-era Okhrana (Otdelenie po Okhraneniyu Obshchestvennoi Bezopasnosti i Poryadka, or Department for Protecting Public Safety and Order). Successor organisations were the OGPU (Obyedinennoye Gosudarstvennoye Politicheskoye Upravleniye, or State Political Directorate, the NKVD (Narodnyy komissariat vnutrennikh del or People’s Commissariat for Internal Affairs) and the KGB (Komitet gosudarstvennoy bezopasnosti or Committee for State Security). The FSB (Federalnaya Sluzhba Bezopasnosti or Federal Security Service) is the main successor organisation to the KGB. The SVR is the much smaller Sluzhba Vneshney Razvedki or Foreign Intelligence Service. It used to be the First Chief Directorate of the Soviet-era KGB. By contrast the GRU (Glavnoye Razveditelskoye Upravleniye or Main Intelligence Directorate) is the military-intelligence service. Much diminished in recent years, it has changed neither its title nor its structure since Trotsky established it in 1918.

  5 See ‘ Delo Poteyeva: predatel nanes ushcherb v 50mln dollarov no ne smog obmanut nachalstvo ukrainskoy lyubovnitsey ’ (The Poteyev case: the traitor cost $50m but couldn’t fool his bosses about his Ukrainian mistress) http://www.newsru.com/russia/28jun2011/poteev.html (this and all other links accessed July 2011).

  6 ‘Spying Suspects Seemed Short on Secrets’ by Scott Shane and Benjamin Weiser, New York Times, 29 June 2010 http://www.nytimes.com/2010/06/30/world/europe/30spy.html ‘Russian Spies Too Useless, Sexy to Prosecute’ by Dan Amira, New York magazine, 7 July 2010 http://nymag.com/daily/intel/2010/07/russian_spies_too_useless_sexy.html ‘Spy swap: Viennese Waltz’ Guardian, 10 July 2010 http://www.guardian.co.uk/world/2010/jul/10/spy-swap-russia-us-editorial ‘The Russian spy scandal that nobody much cared about’ by Alexander Chancellor, Guardian, 2 July 2010 http://www.guardian.co.uk/commentisfree/2010/jul/02/russian-spy-ring-scandal

  7 ‘Spy Swap’ by John le Carré, Guardian, 9 July 2010 http://www.guardian.co.uk/world/2010/jul/09/spy-swap-john-le-carre The Harry Lime reference is to the 1949 film The Third Man (later a novella by Graham Greene, who wrote the screenplay) of espionage in post-war Vienna.

  8 Call For The Dead by John le Carré (Penguin, 1965). The first chapter is online. ‘A Brief History of George Smiley’, Guardian, 22 May 2009 http://www.guardian.co.uk/books/2009/may/22/le-carre-call-for-the-dead

  9 http://charlescrawford.biz/blog/more-on-russian-illegals-and-sleepers (accessed 4 July 2010).

  10 The central character in thrillers by Robert Ludlum, later made into films such as The Bourne Identity (2002).

  11 An excellent fictional account of this comes in Vasily Grossman’s wartime classic Life and Fate (tr. Robert Chandler, Vintage Classics, 2010). The NKVD’s wartime role through the eyes of Soviet soldiers, is well portrayed in Ivan’s War: Life and Death in the Red Army, 1939–1945 by Catherine Merridale (Picador, 2007).

  12 The home page for this programme (in Russian) is here http://www.ren-tv.com/pages/tayny-mira-s-annoy-chapman

  13 The author Yulian Lyandres (1931–93), under the pen name Yuliam Semyonov, published his first book Semnadtsat mgnoveniy vesni (The Seventeen Instants of Spring) in 1968. Unusually, it portrayed Nazi German officials as real people, not caricature monsters. Known as Colonel Maxim Isayev to his KGB colleagues, Stirlitz disrupts Nazi efforts to conclude a separate peace with the Western allies. After the war he hunts fugitive Nazis in Latin America, and is imprisoned at the height of the Stalinist post-war purges.

  14 The New Cold War: How the Kremlin Menaces Russia and the West (Bloomsbury, 2008). Published in America as The New Cold War: Putin’s Russia and the Threat to the West (Palgrave, 2008).

  15 For details see http://russian-untouchables.com/eng/

  16 Mr Mitrokhin made contact with an SIS officer in the British embassy in Riga on 24 March 1992. The CIA had previously turned him down. SIS brought him and his family to Britain in November and later retrieved a large amount of material, said to be six aluminium trunkfuls, copied from the KGB archives and hidden in his dacha garden. Some of it appeared in a series of books that he wrote with the historian Christopher Andrew (Allen Lane 1999–2005), The Sword and the Shield: The Mitrokhin Archive and the Secret History of the KGB; The World Was Going Our Way: The KGB and the Battle for the Third World; The Mitrokhin Archive: The KGB in Europe and the West. A parliamentary inquiry criticised some aspects of this: http://www.archive.official-documents.co.uk/document/cm47/4764/4764.htm

  17 Though this reflects a rise of one-third from the 3 per cent spent in 2008/9 to 4 per cent in 2009/10. It is a larger slice of a larger cake too: the Security Service has twice the staff and three times the budget it had in 2001. http://isc.independent.gov.uk/committee-reports/annual-reports

  18 SB a Lech Walęsa. Przyczynek do biografii (The SB and Lech Walęsa: A Biographical Contribution) by Slawomir Cenckiewicz and Piotr Gontarczyk (Institute for National Remembrance, Warsaw, 2008) http://www.ipn.gov.pl/portal/pl/229/7615/SB_a_Lech_Walesa_ Przyczynek_do_biografii.html

  1 LOOTING AND MURDER

  1 Extensive documentation on this is available at www.russian-untouchables.com and www.lawandorderinrussia.org. A film telling the story is available at http://www.youtube.com/watch?v=2aj2NLFL-lE and (full-length rental version) at http://vod.journeyman.tv/store?p=4455. A thorough legal presentation of the Hermitage case can be found here http://www.scribd.com/doc/20910344/DECLARATION-OF-NEIL-MICKLETHWAITE A much more critical account is ‘Sergei Magnitsky, Bill Browder, Hermitage Capital Management and Wondrous Metamorphoses’ http://marknesop.wordpress.com/2011/01/19/sergei-magnitsky-bill-browder-hermitage-capital-management-and-wondrous-metamorphoses/ but Mr Browder rebuts this criticism, to my mind convincingly.

  2 An accurate but unflattering account of Mr Browder’s approach comes from my successor in Moscow, Gideon Lichfield. ‘A Russian Odyssey’, Stanford Business, November 2006. http://www.gsb.stanford.edu/news/bmag/sbsm0611/feature_browder.html

  3 http://hermitagefund.com/about/hermitageeffect/

  4 http://hermitagefund.com/about/hermitageeffect/Harvard%20Business%20School%20—%20Hermitage%20Case%20Study.pdf

  5 An excellent account of this comes in Putin’s Oil: The Yukos Affair and the Struggle for Russia by Martin Sixsmith (Continuum, 2010). Yukos was bankrupted by bogus tax demands and its assets handed over to Kremlin cronies; its owner was sentenced to lengthy jail terms after successive farcical court hearings, at which he has denounced the regime and the lawlessness it stokes and thrives on, for example in the statement he and his co-defendant Platon Lebedev issued during their trial, on 2 November 2010 http://www.khodorkovskycenter.com/mikhail-khodorkovsky-full-transcript-his-final-words

  6 ‘Bewilderment As Browder Barred As Security Threat’ by Catherine Belton, St Petersburg Times, 21 March 200
6. http://www.sptimes.ru/index.php?action_id=2&story_id=17062

  7 The clip can be seen here http://www.youtube.com/watch?v=lcnF0Cu8Wtc ‘Putin ne smog obyasnit, pochemu v Rossiyu ne puskayut samogo predannogo zarubeznnogo invevestora’ (‘Putin can’t explain why Russia won’t let in the most successful foreign investor’), unsigned article, 17 July 2006 http://www.newsru.com/arch/finance/17jul2006/browder.html

  8 The attorneys’ names are Ekaterina Maltseva, and a husband and wife team: Andrei Pavlov and Yulia Mayorova. In other cases related to the same fraud, this couple has represented claimants against Hermitage. But on this occasion they were claiming to represent it. http://russian-untouchables.com/eng/240m-theft-from-budget/

  9 A video giving an account (critical – and to me unconvincing) of Hermitage’s activities can be found (in Russian) here http://www.mk.ru/video/politics/1013-skeletyi-uilyama-braudera-.html

  10 http://www.assembly.coe.int/documents/workingdocs/doc09/edoc11993.pdf

  11 An excellent account of Mr Magnitsky’s treatment in prison can be found here in Russian http://www.rb.ru/inform/127947.html and here in English ‘Report of the public oversight commission for human rights observance in Moscow detention centers: Review of the conditions of the detention of Sergei Magnitsky in the pre-trial detention centres of the City of Moscow’ http://online.wsj.com/public/resources/documents/WSJ-20091229-MagnitskyReport.pdf. The extracts from Mr Magnitsky’s own writings can be found here: http://russian-untouchables.com/docs/Prison-Diaries-Magnitsky-General-Prosecutor-Complaint.pdf

  12 Ibid. Medical care in Russian prisons is generally lamentable, but high-profile prisoners seem to have a particularly bad time. A lawyer for Yukos, Vasily Aleksanyan, contracted HIV and tuberculosis while in prison, lost his sight and got cancer, before he was released thanks to a ruling by the European Court of Human Rights.

  13 http://russian-untouchables.com/docs/Alekseyeva-Complaint-Eng29Mar2010.pdf

  14 http://russian-untouchables.com/eng/2011/07/russia-blames-medics-for-hermitage-lawyer-death/

  15 The video is available on Mr Browder’s website http://russian-untouchables.com/eng/ or at http://www.youtube.com/watch?v=H7yBOEPYJTc

  16 A list of all sixty can be found here http://www.csce.gov/index.cfm?Fuseaction=Files.Download&FileStore_id=1744 The criteria for inclusion on the list is that the person signed a document associated with the case.

  17 These purported terrorist attacks created a climate of panic in which the then unknown new prime minister, Vladimir Putin, rapidly became the most popular politician in the country thanks to his seemingly tough response. A botched attack on an apartment block in Ryazan turned out to have been the work of the FSB, which explained its actions, deeply unconvincingly, as an anti-terrorist drill. Those brave Russians who have tried to investigate this mysterious affair have ended up dead. See The New Cold War, chapter 2.

  2 The Pirate State

  1 A thorough and lively account of these and other abuses is in Luke Harding’s Mafia State (Guardian Books, 2011). It also details the persistent harassment campaign mounted against him and his family.

  2 World Report 2011: Russia http://www.hrw.org/en/world-report-2011/russia

  3 See my article ‘Licence to Loot’, The Economist, 17 September 2011 http://www.economist.com/node/21529021

  4 See ‘Frau Fixit: Germany, Central Europe and Russia’ The Economist, 18 November 2010 http://www.economist.com/node/17522476

  5 The Return: Russia’s Journey from Gorbachev to Medvedev by Daniel Treisman, (Simon Spotlight Entertainment, London, January 2011), published in America by Free Press.

  6 ‘Neo-Feudalism Explained’ by Vladimir Inozemtsev, The American Interest, March–April 2011. http://www.the-american-interest.com/article.cfm?piece=939

  7 http://wikileaks.ch/cable/2010/02/10PARIS170.html

  8 http://wikileaks.org/cable/2008/10/08LONDON2643.html

  9 http://wikileaks.ch/cable/2009/11/09MOSCOW2749.html_. A similarly worded but slightly different version of the cable can be found at http://www.cablegatesearch.net/cable.php?id=09MOSCOW1051

  10 http://www.cablegatesearch.net/cable.php?id=10MOSCOW317

  11 ‘The Concealed Battle to Run Russia’ by Amy Knight, New York Review of Books, 13 January 2011 http://www.nybooks.com/articles/archives/2011/jan/13/concealed-battle-run-russia/

  12 The New Nobility, The Restoration of Russia’s Security State and the Enduring Legacy of the KGB by Andrei Soldatov and Irina Borogan (Public Affairs Books, 2010). The authors run the www.agentura.ru website, a magpie’s nest of news and analysis, mostly in Russian, all of it well-informed, about the inner workings of the secret state.

  13 Ibid. p. ix.

  14 Quoted in ibid, p. 5.

  15 The draft ‘de-Stalinisation’ programme from the President’s Human Rights Council can be found here http://www.president-sovet.ru/structure/group_5/materials/the_program_of_historical_memory.php

  See for example Natsionalnoye primireniye nevozmozhna bez suda i pamyati (National Reconciliation is impossible without a trial and memory) http://www.rg.ru/2011/04/08/repress.html

  16 ‘Stalin against Putin’ (unsigned) Vedomosti, 28 April 2011 http://www.vedomosti.ru/newspaper/article/259344/stalin_protiv_putina

  17 ‘Reading Russia: The Siloviki in Charge’ by Andrei Illarionov. Journal of Democracy, Vol. 20, no. 2, April 2009 http://www.cato.org/pubs/articles/andrei_illarionov_the_siloviki_in_charge.pdf

  18 Inozemtsev, op. cit.

  19 ‘The mindset of Russia’s security services’, Andrei Soldatov and Irina Borogan, 29 December 2010 http://www.agentura.ru/english/dossier/mindset/

  20 An English version can be seen here http://www.viddler.com/explore/Eastculture2009/videos/4/ The script (in English) can be found here. http://www.pravoslavie.ru/english/80211155439.htm

  21 Soldatov and Borogan, ‘The mindset’.

  22 See for example: http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/ 8244470/Gazprom-held-back-by-its-corrupt-nature.html; http://www.iie.com/ppublications/papers/aslund508.pdf; and http://www.europeanenergyreview.eu/data/docs/Viewpoints/Putin%20and%20Gazprom_Nemtsov%20en%20Milov.pdf

  23 Mr Navalny’s site is www.navalny.ru; Mr Nemtsov’s is www.nemtsov.ru; Mr Milov’s is http://www.milov.info All are in Russian only at the time of writing.

  24 ‘Olga Kryshtanovskaya: Putin vernetsya kak don mafii’ (‘Olga Kryshtanovskaya: Putin returns like a mafia don’) by Andrei Polunin, Svobodnaya pressa, 8 February 2011 http://svpressa.ru/politic/article/38451/

  25 ‘Nelzya dopustit, chtobi voini prevratilis v torgovtsev’ (‘We must not allow warriors to become traders’) Kommersant, 9 October 2007 http://www.kommersant.ru/doc/812840

  26 The episode was well analysed here by the Jamestown Foundation’s Jonas Bernstein, ‘Shvartsman’s Description of Siloviki Business Practices – Truth Or Fiction?’ Eurasia Daily Monitor, 7 December 2007 http://www.jamestown.org/single/?no_cache=1&tx_ttnews%5Btt_news%5D=33224 and in ‘Former Russian Spies Now Prominent in Business’ by Andrew Kramer, New York Times 18 December 2007 http://www.nytimes.com/2007/12/18/business/worldbusiness/18kgb.html

  27 The survey is by the INDEM thinktank and available (in Russian) here: Sostoyanie bitovoi korruptsii v Rossiiskoi Federatsii (State of Domestic Corruption in the Russian Federation) http://www.indem.ru/corrupt/doklad_cor_INDEM_FOM_2010.pdf

  28 See for example ‘A Stain On Mr Clean’ by Christian Caryl and Mark Hosenball. Newsweek, 3 September 2001 http://www.newsweek.com/2001/9/2/a-stain-on-mr-clean.html

  29 Die Gangster aus dem Osten (The Gangsters from the East) by Jürgen Roth (Europa Verlag, 2004). It urgently needs updating and publication in English. Also worth reading is Red Mafiya: How the Russian Mob has Invaded America by Robert Friedman (Berkeley, 2002).

  30 In the course of another investigation, I tracked down a foreign engineer who had been involved in a commercial court case against one of the ‘four’ – in those days much less powerful – involving a broken contract. In the course of
the litigation, he had uncovered compelling evidence of links between this individual and organised crime. This led to a prompt settlement of the case when he threatened to disclose it. When I approached him, he was long retired and running a provincial hotel. He said that it was more than his life was worth to share his research with me. A good example of the tangled, fascinating but inconclusive investigative reporting surrounding the regime’s business interests comes from ‘Factories, tanks, offshore firms and neighbours’ by Roman Anin, Novaya Gazeta, 22 April 2010 http://en.novayagazeta.ru/data/2011/42/2.html

  3 DEADLY GAMES AND USEFUL IDIOTS

  1 For example my article ‘Walk on the dark side’ about the criminal Russian IT company RBN. The Economist, 30 August 2007 http://www.economist.com/node/9723768

  2 ‘Reset Regret: Moral Leadership Needed to Fix US–Russian Relations’ by Ariel Cohen and Donald Jensen, 30 June 2011. http://www.heritage.org/Research/Reports/2011/6/Reset-Regret-Moral-Leadership-Needed-to-Fix-US-Russian-Relations

  3 http://www.guardian.co.uk/world/us-embassy-cables-documents/247712 and http://www.guardian.co.uk/world/2010/dec/1/wikileaks-cable-spain-russian-mafia

  4 A well-sourced account of this comes from the Jerusalem-based journalist Gil Yaron, writing (in German) in the Salzburger Nachrichten. http://search.salzburg.com/articles/5847190. A Finnish connection in the story remains to be investigated.

  5 See for example this speech by Jonathan Evans, director of the Security Service (MI5) here http://www.societyofeditors.co.uk/page-view.php?pagename= The Keynote Speech and the German Verfassungsschutz (Office for Constitutional Protection) annual reports, for example (in German) http://www.verfassungsschutz.de/download/SHOW/vsbericht_2009.pdf ‘Putins Konjunkturprogramm: Russische Agenten spionieren deutsche Energie-Unternehmen aus’ (‘Putin’s growth programme – Russian agents spy on German energy companies’) by Dirk Banse, Welt am Sonntag, 21 June 2009. http://www.welt.de/wams_print/article3965455/Putins-Konjunkturprogramm-Russische-Agenten-spionieren-deutsche-Energie-Unternehmen-aus.html