The man accused of masterminding a massive Russian tax fraud linked to two suspicious deaths has gone on an “orgy of spending” in Britain, with cash going on luxury yachts, private school fees and property, MPs were told yesterday.
Dmitry Klyuev is alleged to have been behind the theft of £160 million from Hermitage Capital, a hedge fund.
Bill Browder, the London-based head of Hermitage, told an MPs’ inquiry that $30 million (£20.6 million) has been traced to the UK and that he has detailed records of £2 million of spending.
He claimed that the British authorities had repeatedly failed to investigate the crime because politicians had received support from those who had benefited from the fraud.
The damning allegations come a week before an international anti-corruption summit which will be hosted by David Cameron in London.
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Mr Browder told the home affairs select committee that the stolen money had passed through 12 British banks including some of the largest high street names. “There has been an orgy of spending on luxury goods,” he added.
The expenditure included $295,622 (£203,000) on an “SBS Glamour” credit card, an invitation-only service for “the wealthiest ladies worldwide”. A further $176,084 was spent on private jet hire with Oxygen Aviation in West Sussex and $192,963 to the yacht and interior design company HB Interior. Nearly $21,000 was spent on tuition fees at Queen Ethelburga’s Collegiate foundation school in York, $41,436 went to Phillipa Lepley, the wedding dress designer, and £115,315 to Harrods Estates property agents.
Mr Browder claimed that Scotland Yard and other crime agencies had refused to investigate the alleged money laundering because it was not in their jurisdiction. “This country is levitating off the flow of dirty money,” he said. “If that money was stopped, I think that certain people would find themselves without businesses and I think those people have some political influence. I can’t explain it any other way.”
The Hermitage case is being investigated in several countries. Sergei Magnitsky, a lawyer for Hermitage who had been investigating the fraud, was arrested in Russia in 2008 and died a year later in a Moscow detention centre. His family claimed he was beaten to death.
Mr Browder and Mr Magnitsky were found guilty of tax evasion in Moscow in 2013; Mr Browder was sentenced to nine years in jail in his absence.
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The case is also being linked to the death of Alexander Perepilichny, who had been helping the Hermitage investigation in Switzerland. He collapsed in November 2012 while jogging near his rented mansion in Weybridge, Surrey. A post-mortem examination discovered traces of a chemical that can be found in a poisonous plant.