The Russian Anti-Corruption Law That Has Putin Fuming At America, Explained

A tombstone on the grave of lawyer Sergei Magnitsky who died in jail, at a cemetery in Moscow, Friday, Nov. 16, 2012. U.S. lawmakers are expected to vote in a human rights legislation named after Magnitsky that would impose sanctions on Russian officials involved in human rights violations. (AP Photo/Misha Japaridze)
A tombstone on the grave of lawyer Sergei Magnitsky who died in jail, at a cemetery in Moscow, Friday, Nov. 16, 2012. U.S. lawmakers are expected to vote in a human rights legislation named after Magnitsky that would impose sanctions on Russian officials involved in human rights violations. (AP Photo/Misha Japaridze)

Amid an ongoing probe into Russian meddling in the 2016 U.S. presidential election, this weekend it was reported that Donald Trump Jr. and others met with a Kremlin-connected lawyer last summer to discuss, among other things, a 2012 law designed to punish Russian officials after the death of an accountant investigating government officials for fraud. This law is the Magnitsky Act, and this is why Russian President Vladimir Putin is so incensed about it.


The New York Times reported Sunday that Trump Jr., son-in-law Jared Kushner and and former Trump campaign manager Paul Manafort met the lawyer, Natalia Veselnitskaya, at Trump Tower to discuss documents allegedly outlining Russian donations made to Hillary Clinton and the Democratic National Committee.

The story says that Veselnitskaya’s statements “were vague, ambiguous and made no sense,” but that she turned the conversation to the Magnitsky Act—a law that blacklists allegedly corrupt Russian officials, and has led to a ban on Americans adopting Russian babies in response.


Understanding the power and symbolism of the act and why it was passed sheds light on why the Kremlin may have wanted to discuss it with the Trump campaign in the first place.

What Is The Magnitsky Act?

Officially known as the Russia and Moldova Jackson-Vanik Repeal and Sergei Magnitsky Rule of Law Accountability Act of 2012, the legislation was passed after Russian lawyer and auditor Sergey Sergei Leonidovich Magnitsky died in a Russian prison in 2009.

The case dates back to 2005 when American businessman Bill Browder and his investment firm, Hermitage Capital Management, uncovered corruption among high-ranking Russian officials. Magnitsky was employed by Browder’s firm at the time. Browder’s Russian visa was revoked and he was forced to leave the country because of his outspokenness against corruption in Russia, but Magnitsky stayed behind.

As he dug further, Magnitsky discovered fraud involving tax and law enforcement officials. More specifically, he noticed Russian companies were “registered to new owners and, while money was changing hands, large rebates and VAT claims were allegedly laundered through Russian banks and appropriated by a group of tax and police officials,” as the BBC notes.


His investigation eventually uncovered more than $230 million in embezzlements. Soon after Magnitsky made the allegations public in 2008, he, ironically, was arrested on charges of aiding tax evasion.

Magnitsky was brutally beaten and abused during his year in prison and eventually died from his injuries on November 16, 2009 at the age of 37. Officially, he died of acute heart failure and toxic shock due to untreated pancreatitis.


As far as human rights advocates are concerned, Magnitsky was murdered. A prison doctor was charged with involuntary manslaughter, but the charges didn’t stick. Another doctor was eventually acquitted of medical negligence charges.

No one has been convicted of Magnitsky’s death.

The story shook Russians and the West alike, forcing the Kremlin to brace itself against non-stop negative coverage about its failure to fight corruption and protect human rights. At the time, then-President Barack Obama was laboring in vain to make his “reset” with Russia work. For a time Obama was on the ropes about supporting the bill to salvage his attempts to ease tensions with Moscow.


The bill eventually passed through Congress, listing more than 60 Russians who are suspected of playing a rule in Magnitsky’s death. The full list has never been published.

The law allows the United States, through the Treasury Department, to prevent Russians from using U.S. financial institutions and bans them from entering this country. In return, the Kremlin banned Americans from adopting Russian children.


Who’s On The List?

According to the Office of Foreign Assets Control, a department in the Treasury Department, there are 44 people on the current list. One of those people is Artyom Kuznetsov, who carried out a raid of Hermitage Capital in 2007 and eventually helped carry out Magnitsky’s arrest, allegedly by fabricating evidence. Not only did Kuznetsov get a promotion after Magnitsky’s death, he has spent more than $3 million on cars and real estate.


Veselnitskaya, the Kremlin-connected lawyer who met with Trump Jr. and Kushner, is a known opponent of the act who also alleged that Browder was guilty of fraud and that he arranged Magnitsky’s death to cover it up. Her meeting with campaign officials could be seen as trying to lobby them to convince Congress to drop the act if they won the election.

We do not know for sure if that was her intent. If it was, that could be another argument that Trump’s campaign colluded with the Kremlin, or with powers acting on the Kremlin’s behalf.


Most of the people on the blacklist are government officials with financial means tied to stealing from the state, so it makes sense that the Kremlin would want to keep them happy by giving them access to the U.S. financial institutions they lost after the act was passed. That, of course, would require someone at the very top of the United States government to get the wheels in motion. And if we are to go by the New York Times report that the Russians claimed to have dirt on Clinton, we’re possibly looking at a quid pro quo situation.

Again, we can only speculate that this is the case. But the possibility is important to consider because the Kremlin values its corrupt grip on power and helping officials who carry out its dirty work regain access to U.S. banks would certainly work in Putin’s favor.


Why Would Putin Want Trump To Get Rid Of The Act?

Putin is among the richest and arguably most corrupt politicians in the world; his net worth is estimated to be in the billions. Yet you won’t find him on any Forbes’ lists because the magazine can’t verify his assets. His wealth in Russia is widely believed to be hidden, according to the U.S. Treasury.


Part of how he is able to hold his grip on power is through unchecked corruption. The Magnitsky Act is a public slap in his face, and it has support in Russia as well.

As The Atlantic’s Alexander Baunov pointed out several days ago, many Russians are getting tired of Putin and his cronyism:

In Russia, the recent round of anti-corruption protests revealed that grass-roots politics in the country is not dead. These protests differed from those of 2011 and 2012, which were sparked by the flawed elections of 2011. This time, the demonstrations occurred across the country, and drew the participation of all the country’s major cities (the protests of five years ago were confined largely to Moscow and St. Petersburg). The immediate pretext was outrage over Prime Minister Dmitri Medvedev’s vast real estate holdings, fueled by opposition politician Alexey Navalny; Muscovites were also protesting against a city housing program that attempted to demolish tenants’ property. Both demonstrations targeted the sort of upper-level corruption that infects Putin’s government: Rewarding high-ranking bureaucrats and businessmen from his inner circle for services and loyalty, with the possibility of getting richer by using and abusing state properties and contracts.

For Russia’s youth, who made up the bulk of those who took to the streets, this merging of business and political interests embodies the injustice of life under Putin (the protests even had overtones of Occupy Wall Street). These Russians resent the corruption and crony capitalism that have enriched so few at the expense of so many.


Getting rid of the Magnitsky Act would allow Russian criminals to access America’s financial systems, essentially rewarding them for their graft at the expense of the Russian people. It would also strike a blow to Russians who are challenging Putin’s grip on power.

And given that many Russians actually support the Magnitsky Act, keeping the legislation in place would prove that Putin can’t get away with murder—figuratively and literally.

Terrell Jermaine Starr is a senior reporter at The Root. He is currently writing a book proposal that analyzes US-Russia relations from a black perspective.

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mkbruin, Atlas VP

So, where is the collusion? That word is thrown around an awful lot lately, but there’s still zero proof of any actual collusion. For this meeting, supposedly the attorney had dirt on Russian money being funneled to the DNC; however the allegation never actually came to light and was never used.

When the dust settled from the weekend report, it appears to be nothing more than yet another hit piece with no actual evidence of any wrongdoing.

Wake me up when something newsworthy actually happens.