Russian Poisonings: What Killed Alexander Perepilichnyy? (PART 2)

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As we discussed in Part 1, Alexander Perepilichnyy died in mysterious circumstances when he collapsed a few hundred meters from his house. He was a healthy, mid-40s average man with no discernible health issues. The coroner ruled his death as natural and said it was probably an exercise-induced heart attack. However, friends and family close to Alexander believe that the police dropped the ball in this investigation and that Mr Perepilichnyy died from poisoning by the Russian government. In Part 2, we will have further in this mysterious case. 

Alexander Perepilichnyy

To look at the events that may have led to Alexander's death, we first have to dive into his entrepreneurial past. In our first post, we covered that Mr Perepilichnyy made his money from lucrative business deals in various industries, even though his education was in science. Alexander always wanted to make money, how he made it was the thing that changed. 

TURNING POINT AT UNIVERSITY 

He attended studies at PhysTech, which was a very well-known university for science studies. When Alexander got there, it was at the same time as Mikhail Gorbachev got into politics, and ''glasnost'' came about. With this new policy of openness, or as far as the Russian model could go, came an influx of new ideas and knowledge into the country. Scientists like Perepilichnyy found that the West has been so much more forward then Russia, and they were exposed to a lot of new ideas and wisdom. 

Alexander decided he would move to America, where he could be a better scientist than he had potential to be in Russia. This was, in part, because there was more knowledge available in the USA, and also more freedom. However, to do this, he would have to raise around US$3,000. His monthly allowance from the university was around US$10 per month. He would need other ventures to make more money. So, he started to sell computers with his friend, Yuri Panchul. 

Moscow Institute of Physics and Technology (or PhysTech)

In 1989, Panchul, who has been programming since he was a teenager, was working with a group of students that would buy computers, program them and then upsell them and make a profit. They invited Alexander to come and join them. He soon proved that, despite having average coding skills, he was a great salesman. From selling one computer every few weeks, they went to sell twelvefold monthly. Perepilichnyy had the gift of the gab and would strike deals with various businesses and government offices that wanted custom-programmed computers. 

The downside of this job was that often they would have to deal with cash, oftentimes in US dollars. This was often sourced on the black market. That meant that Perepilichnyy was a target for robbery and even physical violence. Stories floated around that these robbers were so desperate sometimes that they would torture people with electric clothes irons, or even sodomize businessmen with soldiering irons, to find out where their stashes of cash were hidden. 

In 1991, Perepilichnyy and Panchul signed a contract to develop a program for a simulator for a computer system used in a supersonic fighter jet. They were well paid from that job, so Panchul took the opportunity to move to America. This worked well in his favour because, in 1992, the USA welcomed scientists with experience in weapons. Panchul was able to get a green card this way. Perepilichnyy, by then, raised the US$3,000 he needed, and actually even better. However, his aspirations changed. 

By now, he graduated and his teachers were encouraging him to study a doctorate in biochemistry. But, Alexander wanted to be a businessman with a nice accountant and cushy office, like the ones he saw in the West. He started to branch out and gather experience from different industries. He was heavily involved in the financial industry like money management, currency trading and real estate. He was also involved in foodstuffs like condensed milk and frozen veggies at one point. 

Perepilichnyy was lucrative and made good money, but that money didn't always come from such trustworthy sources like he was dreaming after college. Sometimes, corruption and backdoor deals were the main source of income and where much of his clients' capital came from. 

Amongst the burgeoning list of names that Perepilichnyy was servicing, one in particular came out, Vladlen Stepanov. They met in the middle of the 90s, and Stepanov was impressed with Perepilichnyy's financial prowess, and within a few years gave him power of attorney over his funds. It was sketchy where Stepanov's wealth came from because he was working as a miner who was installing fibre-optic cables. 

Vladlen Stepanov and Olga Stepanova

BACKDOOR DEALS COMING OUT TO LIGHT

Around this time, a US-born businessman was looking to invest in the Russian market. His name was Bill Browder. In 1996, he opened an investment firm in Moscow. This was a time when foreigners weren't looking to invest in Russia. He didn't speak the language and didn't really know the culture, but he manged to have an impressive profit. In less than a decade, his firm was managing several billions dollars worth of assets. 

Browder devised a devious plan that would give him great gains. He was a sort of cheerleader for Putin on the international stage. He would defend him on the world stage and was quoted to have said, ''... we should give him the benefit of the doubt in this area and fully support him in his task of taking the country from oligarchs." Although, they have never met, Putin and Browder danced well together. He would call out corrupt officials and Putin would respond in turn with persecuting them. 

All this changed when Putin realised that he could get a cut of the profits from the nouveau riche by promising to leave them alone if they played by his rules. When Browder kept to the old system and stepped on the growing dictator's toes. Putin decided Browder had to go. He got kicked out of Russia in 2005, by being labelled a threat to national security. 

Bill Browder

The businessman hotfooted it to England, taking his money with him that could be taken out of Russia. There was still some companies left, that were dormant, but he resolved to dealt with them when the time allowed it. This happened in 2005, in November. 

Unbeknown to him, in 2007, Vladlen Stepanov and his wife, Olga Stepanova, were planning the tax heist of the century!

In June 2007, they raided Browder's office and the law firm that represented him, and stole official documents. They used these documents to register the companies that were under Browder's name to new owners. Then they made it so that these companies looked like they were highly in debt and would then be able to claim big tax refunds. 

In December of the same year, they applied for what was the biggest tax refund in Russian history, a total amount of US$230 million. Most of the fraudulent refunds were approved by Olga Stepanova on Christmas eve. 

The money was quickly distributed in various shady transactions and offshore accounts. Stepanov worked quickly to take his share of the profits out of Russia as fast as he could. He used countries like Moldova and Latvia, and then also the British Virgin Islands. There he used Alexander Perepilichnyy as help, where Stepanov used one of Perepilichnyy's companies to hide the money. 

Mr Perepilichnyy then used another company to send the money back to Stepanov and invested the rest of the money in real estate. He was one of the few people that knew the dirty details of Stepanov's fraudulent funds and their various paths. 

In 2008, Browder received a phone call from a bailiff in St. Petersburg asking him when he was planning to hand over the massive amount of US$71 million in judgement that he was due to pay. Browder was confused by what the bailiff was asking as he was unaware of what happened after his company was raided. He hired a tax attorney, Sergei Magnitsky, to investigate the matter. 

Sergei Magnitsky

After a careful investigation, Magnitsky was able to get to the bottom of the story. Unfortunately, it did not end well for him. After finding out that all this money was stolen from the Russian treasury and who was responsible for it, Magnitsky went to the authorities to report the crime. He even testified against Stepanov and his associates. However, soon Magnitsky realised that he was small fish compared to the people he was fighting against. 

He was arrested and thrown in jail. For one year they tried to get him to change his testimony. Magnitsky was beaten, tortured, badly treated and left with health issues that were not addressed by doctors. Despite all this pressure and pain, he refused to change his testimony. On November 16, 2009 he died.

The resting place of Sergei Magnitsky

Browder was deeply affected by the lawyer's death and rage boiled in his veins. He wanted the world to know what happened and wanted retribution for his associate's death. 

In our next post, Part 3, we will take a look at what Browder did, and how the Russians reacted to it. Then, we will see exactly how Perepilichnyy is involved in this circus and how did that contribute to his death. 

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