Red Wolves & White Knights

by Peter Kysel

  “We must go to and see the building site,” she suggested to my surprise. Was Elizabeth involved? Was this her real reason for the trip? Surely, she would have told me…

  A few days later, after a game of tennis, Elizabeth went to have a massage, while I settled at the bar by the swim­ming pool with a fruit cocktail and the FT. I looked up from the paper and saw a smiling face in front of me. A man was standing by my table, waiting for me to react. He seemed familiar, but I couldn’t place him. He shook my hand, called me by my name and sat down. He spoke with a Russian accent. I looked at him again and then I recognised him.

  It was Sergei (Serjozha), my guide in Moscow. I recalled how twenty-two years earlier he had helped with my meet­ings at Gosbank. Sergei was now in full flow.

  “Pyotr, we heard that you had come to Cyprus on holi­day. What a wonderful coincidence. I had to come over and say hello to an old friend. It’s so good to see you.” It was his attempt to disarm me. After a short hesitation, I responded likewise.

  “Sergei, it’s been a long time. What are you doing here?”

  “I organise things here. You may know that in January, the Cypriots accepted $2.5 billion of emergency loans from Russia, to save their banking system. In return, they agreed to offer citizenship to the people, who lost money in the Cypriot banks. We are asking them to do more. We want Cyprus to offer citizenship to any Russian, who invests €2 million on the island. I am here to make sure that these benefits are extended to the right people.” Sergei was clearly the FSB agent in Cyprus, with a plan.

  “Congratulation on your important job, Sergei. You must be at least a colonel by now.” Sergei paused and then laughed.

  “You are not wrong.” I laughed back, digesting his comments.

  Russian residents make up a tenth of the population of Cyprus. Greek Cypriots welcome them as fellow Orthodox Christians. The FSB encourages their people to buy citizenships of EU countries. They are talking about forming a Russian political party in Cyprus. In a couple of decades, the Russians may be in political control of an EU country. Cyprus signed a military cooperation pact with Russia. What will happen?

  Sergei interrupted my thoughts. He put his hand on my arm and said with emotion,

  “We were deeply sorry about Nina’s death and Michael’s terrible loss.” I nearly fell off my chair. I looked around and instinctively moved my drink away from him.

  “I don’t understand.”

  Sergei pulled his chair closer to mine, changing his voice to a near whisper

  “Andrei Ivanov was a rogue agent. He claimed to be innocent of the attack on Nina in London. He instigated and led the raids on Nina parents’ flats and afterwards, he even began a relationship with Nina’s mother. The FSB dis­owned him, and the disciplinary process against him was obstructed by bureaucracy.”

  “What are you saying? That Andrei was responsible?” Sergei cleared his throat, nodded and took a sip from his fruit cocktail

  “Nina was popular. Our officers were outraged and decided to revenge their colleague. Andrei had dishonoured the service and he made things even worse by trying to bribe them.”

  “You mean using the money he stole by skimming off the gold fund in Jersey?”

  “Yes, that fund could have made you rich too. It was going to be a show of our gratitude for your helpful ideas.” I ignored that aside, and pressed Sergei.

  “Has Andrei been terminated?”

  “The action was carried out by a Latvian contact, with a double dose of nerve gas. Both Andrei, and Nina’s mother Galina, suffered severe heart attacks and died.”

  “Did Arthur Talanov carry out the contract?” I had gleaned the name from Nina’s papers. Sergei looked surprised but nodded. My mind raced back to my conversa­tion with Michael a decade earlier.

  Nina investigated nerve gas A-234 attacks in Russia. Talanov was named as the Latvian mafia suspect. Nina knew him. The same Talanov executed Andrei and Galina. Indirectly, Nina played a part in the revenge for her own death.

  “Are you asking me to pass your condolences to Michael and his family?”

  “I would appreciate it. Tell him that he and his family will always be welcome in Russia. As an Englishman, Michael dedicated himself to help our country. He’s a dear friend of Russia and we’re grateful to him.” I looked at Sergei, amazed. I didn’t expect to hear an apology from an FSB colonel.

  “Ivanov had no associates. He acted out of personal motives. Galina had the misfortune of being with him when he was eliminated,” added Sergei. I responded automatically, still in a state of shock

  “I’m grateful for your condolences and particularly for the explanation. I’ll pass them on.”

  “Enjoy the rest of your holiday. I must run now. I would highly recommend the Karatello restaurant for dinner. It’s a charming place, in an old carob mill, next to Limassol Castle. Take your friend Elizabeth.” With that Sergei rose from his chair

  “Tell me before you go Sergei. Did the Hermitage replace the copies of the Impressionists’ paintings with the originals?” He shrugged his shoulders and grinning, he responded with a question.

  “Do you believe that the painting of the Mona Lisa in the Louvre is the original?”

  “In the subdued light and behind bulletproof glass, she could be a copy.” I said thoughtfully.

  “Are the corpses of Lenin in Moscow and of Ho Chi Minh in Hanoi any more real?” chuckled Sergei

  “Pilgrims believe that they are, when paying their respects to their venerated idols. But, as you suggest, the mausoleums could be exhibiting copies.” He didn’t bother to respond but shook my hand.

  “Do svidaniya dorogoy angliyskiy bankir [Goodbye dear English banker],” he said and left.

  I watched him walk through the hotel gardens and on to the beach path. Sergei was walking towards Malindi, where the grounds were being cleared for the construction of new apartment blocks.

  Sergei knew Elizabeth’s name. Many Russian biznesmen will be arriving in Cyprus with €2 million to buy flats and become EU citizens. The greedy Cypriots are selling their country. One day, Russia will annex this island. I ended my thoughts with a shudder and waived at Elizabeth, who was coming down to the garden from the hotel and ordered us another drink. We invited Elizabeth’s friends to dinner at the Karatello, which turned out to be the best restaurant in Limassol.

  On the flight back to London I couldn’t resist asking Elizabeth,

  “Is your husband involved in the Malindi development?” She had expected the question.

  “Yes, we are financing it.”

  “Are you separated from your husband?”

  “My husband is much older than me. We agreed that he should live with my good friend Pru, who is his age and the arrangement gives me my freedom.”

  “So, you aren’t legally separated?”

  “No, we are going to stay married until he dies.” Inheritance is everything. Her husband could be alive for another fifteen years. I’m Elizabeth’s escort, but for how long? The rich have different morals. I was beginning to feel uncomfortable in this relationship.

  “Did you know that the buyers of the Malindi apart­ments will be the Russians?”

  “No, but who cares.” Her response sounded false.

  Why is a north of England businessman involved in a foreign venture that strays so deeply into international politics? Lady Elizabeth won’t tell the full story. I could suffer from collateral damage in this affair.

  #

  White Knights Retired

  The Blaník mountain was the spiritual home of the white knights. Over time they were geographically dispersed, as the Nazis, and then the communists, forced millions of East Europeans into exile. The future white knights were trained in their adopted countries, learning skills which had been banned and gradually forgotten in their socialist homelands.

  In the early 1980s the white knights acquired influential sponsors in the USA and later in Britain. Other countries were more interested in retaining cordial rela
tions with the Soviets. When the time came to roll back socialism, the white knights of Eastern Europe were ready. They returned from abroad, to transform their countries.

  After the popular revolts, political power throughout Eastern Europe was seized by the red wolves. They became popular by blaming former communist rulers for the crisis of socialism. The white knights arrived in time to influence economic reforms and implement privatisation. By success­fully transforming the economy, they underpinned the sta­bility of the new popular democracies.

  It took a decade to transform the economy, but once the job was completed, the white knights began to retire. A minority of them, like Michael Johnson joined the red wolves, to seek wealth and political influence.

  The original sponsors of the white knights faded away. Ronald Reagan was the first to die in 2004, followed by Václav Havel in 2011 and by Margaret Thatcher two years later. Reagan and Thatcher were acclaimed for reversing the injustices inflicted on the region by their political ances­tors. The deep sense of abandonment of Eastern Europe, had been atoned.

  I believed that the transformation of Eastern Europe would be achieved in a generation. Twenty years later, the red wolves had been purged from business, except in Russia, but political reforms remained incomplete, with the geriat­ric red wolves still clinging on to power.

  #

  Svetlana’s Ambition

  On my return from Cyprus, I called Svetlana and Michael, who had moved from Cape Town to London. Their first daughter, Olga, was born in Cape Town in 2009, but their second daughter, Natasha, was born two years later in London. Michael concentrated on managing his corporate finance boutique and the foundation. Svetlana supervised their property portfolio in Moscow and helped her father Viktor’s retail company, which was developing an online business. Michael, who sensed that I had some significant news, suggested meeting at the Cliveden Hotel in Taplow for lunch.

  “The countryside setting will be perfect for a private con­versation. The children can run around in the grounds,” he said. After lunch, the nanny took charge of the children and the three of us set off for a walk. When we reached the dining room terrace overlooking the park, I opened up.

  “I have astonishing news for you.” We walked down the steps into the gardens. There were hardly any visitors around. I described my meeting with Sergei. Svetlana and Michael looked stunned by the circumstances of the deaths. We walked in silence until we reached the path down to the river. We were alone now. Michael began to respond.

  “It’s a relief to know the reasons for Nina’s death and it will help us to come to terms with the tragedy.” To my sur­prise Svetlana was tough.

  “Natural justice has been done.” Michael just nodded. When we reached the river, I asked,

  “How do you feel about Galina?” Svetlana answered first.

  “Galina’s hatred has been punished.” Michael was bitter, adding,

  “How could Galina betray her daughter? Her Stalinism was stronger than her maternal instinct. She was a mon­ster.” I tried to defuse the atmosphere.

  “People are brainwashed to choose ideology over humanity. As children we were drilled to be loyal to the state. The Soviet pioneer Pavel Morozov was our idol. He denounced his parents for hiding a bag of wheat. When his parents were executed by the Soviets, Pavel was strangled by neighbours. We considered him to be the martyr, not his parents. Most people grow up to reject ideology, but some, like Galina, remain fanatics. Svetlana asked,

  “Michael, did Galina know your family’s history?”

  “No. Nina and I agreed not to tell her.” There was notice­able relief. I said carefully,

  “You might like to keep Galina’s story from your chil­dren.” They both nodded in agreement. On the path up towards the hotel, I passed on the message from Sergei, about Michael’s family being welcome in Russia.

  “We have thought of moving to St Petersburg. This may be the green light we were waiting for. I will speak to my father to check out the FSB’s approval,” enthused Svetlana, and Michael returned to business.

  “We have to make some decisions. Our properties are substandard, but well located. They are ready for redevel­opment. If we stay in London, we’ll sell out. If we move to Russia, we’ll rebuild them and transform the business.”

  “The business will enable us to give more money to the foundation,” added Svetlana.

  “What about your children?”

  “George is ten and is keen to go to Russia. We will send him and Olga to a private school and keep a nanny for little Natasha. George will go to Harrow, when he is thirteen. My parents promise to visit us regularly and we’ll spend our holidays in Cape Town. It’ll all work out fine.” They had clearly decided to move. I turned to Svetlana.

  “Will you get a full-time job?”

  “I’ll take charge of my father’s online business.” She paused and added,

  “I would also like to get involved in Russian politics. I’ll start at the local level, to see if I am any good.” Svetlana had turned out to be more focused and ambitious than I expected.

  “You’ll be conflicted between the foundation, your busi­ness and politics.” I said cautiously.

  “We’ll manage” said Svetlana with a smile. Michael nodded in Svetlana’s support, so I kept quiet.

  Chapter 32

  Michael Leaves the White Knights

  Michael decided to move and align the future of his family with the country of his ancestors. Reflecting on Jack’s anal­ysis, he had made his choice. For me, the implications of his move were unsettling.

  Leon Trotsky, who ordered the execution of Michael’s grandfather, had a saying: “When one runs with the (red) wolves, one must howl with the pack.” Paradoxically, these same secret police hacked Trotsky to death in Mexico a few years later. They also killed Michael’s great-uncle Gyorgy in France, by sabotaging the brakes of his car. Michael was only alive today, because his great-grand­mother had kept the existence of his grandfather secret.

  Svetlana and Michael accepted that they had to adopt Russian business ethics. I was troubled that, after twenty years of ethical business dealings, Michael was prepared to compromise his principles and tarnish his family’s reputa­tion. Michael is leaving the white knights. He sensed my mis­givings and diverted the conversation.

  “Boris Berezovsky is suing Roman Abramovich for $5 bil­lion for his share in Sibneft. Borby has asked me to lend him money for his legal expenses.” We both chuckled.

  “A decade ago, Borby was worth $3 billion. Has he spent it all? Are you going to lend him the money?”

  “I’m going to keep out of it. This is a private dispute between two rich men. Borby doesn’t have the papers to prove his ownership, so he’ll lose.” When Svetlana and Michael left Cliveden, I sat down in the hall for a cup of tea.

  Svetlana has a consensual approach and has developed her social skills in England. That should help her climb up the political ladder. Her timing is good. Under the Magnitsky Act many influential Russians have become pariahs in the West. She is fresh and acceptable in both Russia and abroad.

  The state duma elections were scheduled for 2016 and 2021 and the presidential elections for 2018 and 2024. The timing of the Johnsons’ move to Russia was intriguing.

  Michael is well respected. Is it a family plan to restore the Romanov dynasty as rulers of Russia? Will he, the descendant of the last Tsar, become the husband of the first female president? Is his son George going to be groomed for politics too? These are breath taking concepts.

  My protégé had great ambitions. They were only achievable if the family lived in Russia. Sadly, this was the moment that our close partnership was coming to an end, as his ethics were bound to become compromised.

  Some white knights can’t last the whole journey. Their polit­ical ambitions and their avarice corrupt them, and they join the red wolves. Michael is one of those. I finished my tea and drove home, slowly digesting this news.

  I discussed all this with Jonathan on th
e Highgate golf course. He had a more positive reaction.

  “Your allegory of the white knights is apposite for the Czech nation, but not for the Russians. You and other exiles left in 1968 and then returned to rescue your country just two decades later. The market system was still a living memory to you and your father. There was no army of white knights in Russia to save the country. They had either been shot or perished in gulags during the previous seventy years. Michael is behaving rationally. If he were to continue alone as a white knight, he would fail.”

  “Perhaps Michael should wait, before moving to Russia and focus on doing more good, through the foundation.”

  “Don’t worry, Michael and Svetlana won’t forget Western culture, or your patronage.” We walked on in silence before Jonathan added,

  “Michael and Svetlana will mutate into a new breed. A cross between a white knight and a red wolf. You could call them white wolves. Just wait and see. They might be good for Russia and far more effective than you think.”

  This time I won the round of golf and Jonathan made me feel slightly more relaxed about the Johnsons’ plans.

  #

  Foundation

  In 2013, Russia under president Putin was increasing its anti-Western rhetoric. The president was accusing foreign non-governmental organisations of hostility towards tradi­tional Russian values and banning them.

  The foundation was forced to respond. At a board meeting, George Johnson reviewed the foundation’s objectives.

  “We shall continue to pursue our important goals. Dirty Russian money is a global poison. Laundering this money is being facilitated by the Western banks. The US has begun to prosecute Russian financial crimes, but other countries are not following suit. We will need to encourage more action.”

  Michael added, “We have plenty of evidence that dirty Russian money enters the financial system through Baltic banks. These schemes involve transfer pricing, falsifications of foreign trade documents, tax scams and pledges of stolen art and commodities. Just one of these schemes moved $21 billion out of Russia through companies in the UK, Cyprus and New Zealand, using 700 global banks.” Michael then described the schemes and their Western intermediaries in detail. We sat there, astonished to hear so many well-known names.