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The UK’s Russia Report on the “Londongrad Laundromat”

Photograph Source: Adrian Pingstone – Public Domain

The UK parliament’s Intelligence and Security Committee (ISC), drawn from MPs and peers of all parties, last week published its report on possible Russian interference in UK politics.

The report’s release had been delayed by 9 months after it had been blocked by Boris “BoJo” Johnson in the run-up to the December 2019 general election.

The 55-page report– containing 175 redactions as well as several secret annexes– investigated possible interference by the Kremlin in UK politics.

The ISC does not come to firm conclusions, because it was not in a position to do so. It was impossible to say whether the Russians had in fact tried to influence UK politics—quite simply, the government made no attempt to find out what, if anything, was going on, or could have been going on.

If the report could not come to any conclusions about the activities of Russian bots, it certainly had enough to say about Russian oligarchs.

While UK politicians were turning their collective back on this issue in an act of willful blindness, the report makes it clear that quite a few in the top echelon of the Tory party had become particularly good pals with Kremlin oligarchs. Indeed, a cynic would say, why take an interest in the origins and uses of the iffy money pouring into the “Londongrad laundromat”, as long as the roubles were coming in by the truckload?

The report is forthright about the corruption of the UK associated with the inflow of wealthy Russian oligarchs, making use of easy-to-acquire “investor visas” if you could afford it, from the late 1990s onwards (Blair’s New Labour was in office at that time).

According to the ISC report:

“Russian influence in the UK is the new normal. Successive governments have welcomed the oligarchs and their money with open arms, providing them with a means of recycling illicit finance through the London ‘laundromat’, and connections at the highest levels with access to UK companies and political figures”.

The report goes on to say:

“There are a lot of Russians with very close links to Putin who are well integrated into the UK business and social scene, and accepted because of their wealth…. The money was also invested in extending patronage and building influence across a wide sphere of the British establishment – PR firms, charities, political interests, academia and cultural institutions were all willing beneficiaries of Russian money”.

Though the report does not name these “Russians with very close links to Putin”, the Tories are reported to have received donations from 9 Russian individuals.

In addition, a reading of the Byline Times reveals who some of them are.

They include Alexander Lebedev, the former London KGB chief who owns the Evening Standard and the Independent. The playboy BoJo often parties at Lebedev’s properties in the UK and Italy, and met him soon after the Novichok nerve-agent poisoning of Sergei and Yulia Skripal in Salisbury in 2018.

Lebedev and BoJo call each other “Sasha”, the Russian diminutive of “Alexander” (“Alexander” being BoJo’s first name).

Former and current big players in the UK political and commercial scene include Roman Abramovich (the owner of the Premier League soccer club Chelsea), Oleg Deripaska (known to have business dealings with Trump’s felonious associate Paul Manafort), Dmytro Firtash (wanted in the US for loan fraud), and the former Russian arms chief Alexander Temerko, who has donated more than £1.3m to the Conservatives. Temerko has been a citizen of the UK since 2011.

Just last week the Electoral Commission published new data showing continued financial support for the Conservative party from the wife of a former minister in Vladimir Putin’s Russian government.

Lubov Chernukhin, who is married to ex-Russian finance minister Vladimir Chernukhin, donated £325,000/$410,000 to BoJo’s party in the first quarter of 2020, according to the latest data, making her the biggest ever female political donor in the UK.

In 2014, she paid £160,000/$202,000 for a game of tennis with BoJo and then-prime minister David Cameron, as well as a further £30,000/$38,000 for dinner with the UK government’s current education secretary, Gavin Williamson.

In May last year, Chernukhin dined with ex-prime minister Theresa May and numerous female members of the Cabinet at the time, after donating £135,000/$170,000 to a Conservative Party fundraising event.

The Northern Ireland secretary former and former Tory Party chairman Brandon Lewis received £25,000/$32,000 from Chernukhin. (Lewis also received £23,000/$29,000 from Alexander Temerko.)

In all, Lubov Chernukhin has given over £1.7m/$2.16m to the Tories. As a British citizen her donations are legal.

An investigation by Open Democracy found that the Conservative Party received at least £498,850/$642,000 from Russian business executives and their associates between November 2018 and October 2019. This was a substantial increase from the previous year when donations from Russian sources amounted to less than £350,000/$441,000.

The Independent reports that 13 Tory cabinet ministers received “large sums” from Russian donors.

Alok Sharma, the business secretary, received £10,000/$13,000 from Temerko’s energy firm Aquind in 2020 and £15,000/$20,000 from Offshore Group Newcastle (OGN) in 2014. Temerko was vice-chairman of OGN.

Simon Hart, the Wales secretary, received £9,000/$11,500 from Temerko between 2016 and last year and a further £23,000/$29,500 from Aquind in 2019.

The chancellor of the exchequer/finance minister Rishi Sunak’s constituency party received £6,000/$7,700 from Temerko in 2015.

The justice secretary Robert Buckland’s constituency party received £5,000/$6,400 from OGN in 2014.

The international development secretary, Anne-Marie Trevelyan, received £2,500/$3,200 from Temerko and her constituency was given a further £17,000/$21,700.

James Wharton, the former MP and Northern Powerhouse minister, received £25,000/$32,000 in donations over 4 years from Temerko.

David Morris MP received a £10,000/12,800 from Temerko’s Aquind.

Theresa Villiers, minister for environment, food and rural affairs from 2019 to 2020, received £2,000 through her constituency party in 2019 from Lubov Chernukhin.

Mark Pritchard MP received £5,000/$6,400 from Temerko’s Aquind for his constituency in 2019.

As the money laundering capital of the world, Londongrad has been the primary recipient of this dark money fed into it by the Russian kleptocracy.

Just two known cases – the Moldovan Laundromat scheme and the Deutsche Bank ‘mirror trades’ scam – saw £20bn/$25bn shifted into the UK through shell companies and limited liability partnerships in the past decade alone, successfully corrupting large areas of the financial industries which process this illicit money. A chunk of it then finds its way into the coffers of the Tory party.

Brits have also cashed in on the Russian connection. Brexit-supporting businessmen such as Jim Mellon and the Chandler brothers made huge fortunes in Russia after the collapse of the Soviet Union, and some senior parliamentary figures, such as Jacob Rees-Mogg (the Leader of the House of Commons), still have important investments there.

The ISC report also noted that “a number of members of the House of Lords have business interests linked to Russia, or work directly for major Russian companies”.

Several peers and ex-peers sit on the boards of wealthy Russian companies. They include Lord Barker, who is chairman of EN+, co-owned by the already-mentioned oligarch Oleg Deripaska.

Tony Blair’s former adviser, Lord Mandelson, was a non-executive director of the Russian conglomerate Sistema, for which he was paid £200,000/$255,000 a year. Mandelson reportedly continues to be a shareholder in Sistema.

Other members of the Lords work for Russian enterprises, including the shipping firm Sovcomflot UK, the oil firm RNG joint stock company, and the oil refining giant Russneft.

BP, the petroleum multinational, has a 19.75% stake in Rosneft (not to be confused with Russneft). Rosneft’s CEO Igor Sechin is a close ally of Putin’s. Other leading companies with branches in Russia include Barclays and Citibank.

The ISC report recommended that members of the House of Lords should register payments above £100, in line with the register of interests required of members the House of Commons.

In addition to blocking the ISC report for 9 months, and rejecting every one of its rather tepid recommendations, BoJo and the Tories have opposed, consistently, every legal measure to introduce tax transparency. As a result, their billionaire backers can continue on their merry ways with little or no accountability.

Anyone for tennis with BoJo? At £160,000/$202,000 a pop?

And those handsome donations? If you are a Russian billionaire, Tory HQ will probably provide you with details of the appropriate account for a bank transfer.

Trump and the Republicans have corrupted and weakened the US political system, and BoJo and the Tories have done something similar to its UK equivalent.

It is impossible to avoid the thought that this state of affairs brings a gleam of satisfaction to the eyes of Putin and Xi Jinping.

Kenneth Surin teaches at Duke University, North Carolina.  He lives in Blacksburg, Virginia.

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