Bill Browder and Jamison Firestone: Chaos and Murder in Putin's Russia

**Vas Kristadoulou** (0:07)
Hello and welcome to the How To Academy Podcast, the bi-weekly show from London's Home of Big Thinking. I'm Vas Khristadulu.
In the 90s, Bill Browder and Jamison Firestone had front row seats for the fall of Russia's nascent democracy and the rise of Putin's mafia state. Bill's Hermitage Capital was the largest portfolio investor in post-Soviet Russia, and Jamison was the founder of the country's first independent law firm. When they found themselves at the center of the biggest tax theft in Russian history, their lawyer Sergei Magnitsky was assassinated for uncovering the truth. Since then, they fought a global campaign against the Russian government, and Jamison tells the whole story in his new book Rule of Lies. He and Bill joined Edie Lush live on stage to tell us more.

**Edie Lush** (0:58)
So we're going to get straight into it because right now, $300 billion worth of Russian central bank money is sitting frozen in European accounts. What happens to it, whether it goes to Ukraine, whether it stays put or gets returned, is one of the most consequential decisions that the West has to make. And the two people who are sitting right here have done a very great deal to create the legal tools with which we hold Russia to account. So you've already heard their introduction. Let's start with where this fight stands now and how we got here. I promise that we will go back to the stories that are contained in here because they are absolutely fantastic.
I sat down with Bill first in Davos in 2013, and that seems like a very different world from today.
There's a quotation in Jamison's book. Russia has gone from a land of infinite freedom, opportunity, and hope to a mafia state and from there to a dictatorship that attacks its own people, destabilizes our democracies and wages war on its neighbors. For better or worse, you are both a victim of Russia and one of its success stories, you're right. Let's start in the present with this $300 billion, the war in Ukraine and a US administration that has changed sides. Where does this fight actually stand right now? Give me a state of play, Jamison.

**Jamison Firestone** (2:30)
Well, sorry about that.
As far as obviously America has, for one reason or another, Trump likes Putin, doesn't like Zelensky, and America has basically bailed on absolutely everything. So really, we're talking about a European effort right now, an EU effort right now. It's the EU that funds Ukraine at the moment, and most of that 300 billion that you spoke about is in the banks in the EU. So where we stand on this is, what will the EU do with the money? Now, legally, the money can only go two places. It can go back to its owner, the Russian Federation, because this is Russian government money. This is money that people have paid in taxes, it's their central bank reserves, or it can be given to the victims of this war of aggression.
So what should happen and what has not happened is that government should say Russia will owe Ukraine reparations, the damage it's done is more than the money we're holding, so let's just pay this money to Ukraine to pay down that reparations bill. That's option one. Politicians are afraid to do that because they're afraid that if they do that, then other nasty dictatorships won't keep their money in European banks and in the Euro. Option two, which is really creative, almost happened in December and we'll be up for discussion again, is what they call a reparations loan. This is actually brilliant and I'm sorry I didn't think of it myself, but it works like this. When you put a thousand pounds in the bank, your thousand pounds no longer belongs to you, it belongs to the bank. The bank will lend your money to somebody else. That is how the bank makes money. So all you have is an IOU from the bank. So Russia has 220 billion euro in European banks and what the EU has proposed doing is why don't we just borrow that money, the EU borrows it from Russia's bankers, gives the bankers an IOU and lends the money interest-free to Ukraine.
So what happens in that case is Russia still owed the money, the banks say we owe it to you, but they can't pay them because of sanctions and of course, the EU can keep the sanctions there forever. And if they ever do have to pay, it's backed by the good faith and the public debt of the EU, so it will get paid. So this is a way essentially, whenever you hear reparation loan, it's just borrowing Russia's money from its banks and lending it interest-free to Ukraine. It's an interest-free, cost-free way for Europe to get 220 billion euro to Ukraine. That's where we are today. And that'll come back in about a year when the money that the EU has provided, 90 billion, runs out. We'll all be talking about how to fund the war some more, and we'll be back at this question.