Hearing :: The Medvedev Thaw: Is it real? Will it last?

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HEARING


COMMISSION ON
SECURITY & COOPERATION IN EUROPE: 
U.S. HELSINKI COMMISSION

THE MEDVEDEV THAW: IS IT REAL?  WILL IT LAST?

WITNESSES:
SERGEY CHEREPANOV,
RUSSIA COORDINATOR,
WATCH TOWER BIBLE AND TRACT SOCIETY OF PENNSYLVANIA

MUSA KLEBNIKOV,
EXECUTIVE DIRECTOR,
THE PAUL KLEBNIKOV FUND

WILLIAM BROWDER,
CEO,
HERMITAGE CAPITAL MANAGEMENT

SARAH MENDELSON,
SENIOR FELLOW,
CSIS

THE HEARING WAS HELD FROM 10:00 A.M. TO 11:37 A.M. IN ROOM SVC 203/202 OF THE 
CAPITOL VISITOR CENTER, WASHINGTON, D.C., [SENATOR BENJAMIN CARDIN (D-MD), 
MODERATING] 

TUESDAY, JUNE 23, 2009



SENATOR BENJAMIN CARDIN (D-MD):  Let me welcome everyone to today’s hearing for 
the Helsinki Commission.  The hearing today will concentrate on Russia.  I 
think it’s a very timely hearing for the commission considering that President 
Obama will shortly be traveling to Moscow and that our Helsinki Commission will 
participate in the Parliamentary Assembly in Vilnius next week.  

I think this hearing is particularly important and I want to thank all of the 
witnesses for making extraordinary efforts to be here.  We’ve had some travel 
halfway around the world in order to be at this hearing today and another from 
London.  We appreciate those efforts.

I think it’s critically important for us to understand what is happening in 
Russia.  It’s evolving all the time – in the news today about – in Russia, 
what’s happening in that region. Our bilateral relationship in recent years has 
unfortunately been cool at best.  Some of this is the result of the failed 
policies of the Bush administration, but the Russian government has regressed 
on reform.

The rollback of Russia’s fledgling democracy, the erosion of the rule of law, 
the deadly attacks on independent journalists, and the recent war in Georgia 
are just a few of the many examples of hard-line policies emanating from the 
Kremlin.

The new administration has been quite active in reaching out to Russia and 
there has already been a number of high-level meetings.  I am hopeful that we 
are at the beginning of a new and fruitful partnership with Russia.

Although our two great countries may not see eye to eye, being best friends may 
not be the measure of a successful relationship.  There are many issues of 
mutual concern that we cannot afford to ignore, and restoring trust and mutual 
respect with Russia will allow us to pursue common security while fully 
upholding our OSCE commitments.

Some in the human rights community here and in Russia are concerned that the 
reset in U.S.-Russia relations may lead to less attention being paid to 
traditional concerns such as religious freedom, media freedom and the rule of 
law.  Today’s hearing is intended to send the message that the laudable goals 
of improving relations with Russia and taking Russia’s compliance with human 
rights commitments seriously need not be mutually exclusive.

When General Secretary Brezhnev signed the Helsinki Final Acts or the Helsinki 
Accords on August 1st, 1975 on behalf of the USSR, Soviet officials believed 
that they had gained an important foreign policy victory.  Indeed, there were 
some provisions the Soviet diplomats had sought during negotiations with the 35 
nations that they were successful in accomplishing.

However, the West, for its part, had insisted on certain provisions in the area 
of human rights and humanitarian affairs, including the right of citizens to 
know their rights and to act upon them. 

In this context it is worth reminding everyone that since the 1991 Moscow 
Declaration, raising human rights concerns in the OSCE context is the 
legitimate prerogative of participating states and cannot be construed as 
interference in another country’s internal affairs as the OSCE states have 
recognized the right and obligation to monitor and comment on the fulfillment 
of human rights commitments in any OSCE country.

It’s our responsibility.  We have the perfect right to raise violations of OSCE 
commitments in any of the OSCE countries.  As chairman of this commission I 
take seriously my responsibility implementation of the Helsinki Final Act and 
subsequent agreements throughout the expansive OSCE region, including in my own 
country, and I have done that.

Governments, including parliamentarians, have an important role to play in 
candidly raising human rights concerns and cases as part of their ongoing 
engagement.  As the late Soviet human rights advocate Andrei Sakharov once 
observed, “The whole point of the Helsinki Accords is the mutual monitoring, 
not mutual evasion, of difficult problems.”

The Helsinki Commission and the OSCE is fully committed to the development of 
democracy, civil society and the rule of law, free markets in the Russian 
Federation.  We trust that the Russian president shares that commitment when he 
claimed that the most important task is the further development of civil and 
economic freedoms.

Yet we see evidence of Russian authorities continue to selectively prosecute 
and harass human rights advocates, religious communities, prominent business 
leaders and journalists by employing arbitrary and actual legal means to 
achieve political ends.  This is often accomplished through the manipulate 
court system, thus denying citizens and foreign investors the impartial 
application of the rule of law and equal justice.

So today’s hearing, to listen to experts as we try to understand what is 
happening in Russia, to try to improve our relationship with Russia because we 
have a lot of issues that are in common, but also to make it clear that we can 
hold Russia to its commitments under the OSCE.

Now, normally we would start our discussion with the representative of the 
State Department, and that person would normally be Phil Gordon, who is the 
assistant secretary of state for Europe and Eurasian Affairs.  Secretary Gordon 
is on travel today, and he wanted to be with us but could not because of his 
schedule.  We wanted to make sure this hearing took place before the 4th of 
July recess.

So it’s just too urgent to hold off on hearings, and we therefore are 
proceeding with out the normal protocol of hearing from the administration 
first.  

On our first pane we have Mr. Sergey Cherepanov, who is the leader of the 
Jehovah’s Witnesses community in Russia, and he traveled all the way from St. 
Petersburg to be with us today.  That’s a commitment.  I assume that’s St. 
Petersburg, Russia.  

And then we have Ms. Musa Klebnikov, widow of the American journalist Paul 
Klebnikov, who was murdered in Moscow almost five years ago.  Ms Klebnikov is 
the executive director of the New York-based Paul Klebnikov Fund, which is 
active in supporting excellence in journalism in civil society in Russia.

We are also happy to have Mr. William Browder, CEO of the Heritage Capital 
Management and a leading global shareholder rights activist and outspoken 
fighter for better corporate governance in Russia.  He has traveled from London 
to be at this hearing. 

So we really have a global panel here today, and we thank them very much for 
their participation, and we will start with Mr. Cherepanov.  Sergey, why don’t 
you start the panel?

SERGEY CHEREPANOV:  Mr. Chairman, I would like to take this opportunity to 
thank the members of the United States Commission on Security & Cooperation in 
Europe for allowing me to testify on behalf of the more than 157,000 Jehovah’s 
Witnesses in Russia.  

However, at the outset I’d like to state that I was deeply saddened by the 
terrible news of the Metro crash yesterday and express my condolences to those 
who lost their beloved ones.

Our life is filled with negative news, and I’m afraid my statement represents 
concern, and will not sound much too positive.  

The precious fundamental freedoms Jehovah’s Witnesses gained following the 
collapse of the Soviet Union have never been more threatened.  We have 
experienced – we are experiencing a deep freeze, not thaw, in the Russian 
government’s treatment of our religion.

  During the 1960 and 1970s, the KGB considered Jehovah’s Witnesses to be a 
foreign religion and a threat to Russia’s national security.  The persecution 
of Jehovah’s Witnesses and other religious minorities during that time is well 
documented.

After the fall of the Soviet Union, we experienced considerable relief and 
obtained national registration in 1991 in are now registered in 73 regions of 
Russia.  However, the Russian government is suddenly reverting to dealing with 
us as it did during the Soviet era.

Since the year 2000, the FSB labeled Jehovah’s Witnesses as extremists, and in 
2007, all prosecutors’ offices in Russia received a letter on methods for 
preventing religious extremism, signed by Deputy Prosecutor Vilya Green (ph).

Days after this letter was sent out, 34 warnings were issued to all local 
religious organizations across Russia.  Individual witnesses were searched, 
detained and forcibly photographed.  Individual rights were violated as private 
information was gathered on school children, school teachers and other 
professionals who are Jehovah’s Witnesses.  

This year events have escalated considerably further.  The FSB is working 
through local prosecutors to file claims of extremist activity against 
Jehovah’s witnesses throughout Russia.  By misapplying the revised 2007 law in 
counteracting extremist activity, they are trying to ban our religious 
interchange and liquidate our local religious organizations.

We are already defending eight lawsuits filed by local prosecutors across 
Russia on the extremist issue alone.  They are also seeking any pretext to 
close our national office in St. Petersburg with the overall objective of 
banning our worship throughout Russia.

This was the goal of the Golovinsky trial, which resulted in the banning of our 
religious community in Moscow in 2004.  Local prosecutors have hired their own 
so-called experts to study our religious literature, knowing that these experts 
will support their accusations if just one regional court judge any where in 
Russia rules that the nature of our literature promotes extremist activity.  

It will be posted on the federal list of extremist literature and banned 
throughout the country.  Once literature is placed on this list, it is nearly 
impossible to have it removed.  

In February, 2009, the Russian Federation General Prosecutor’s Office ordered 
local prosecutors’ offices throughout Russia to gather any negative information 
they could find on Jehovah’s Witnesses.  They were authorized to involve 
agencies of the FSB, police, public health agencies, local departments of 
justice, and military commissariats to try and find such negative information.

As a result, over 500 investigations have been initiated against individual 
witnesses and our local religious organizations.  Thus, the General 
Prosecutor’s Office is orchestrating a witch hunt on Jehovah’s Witnesses that 
will lead to the criminal prosecution of individuals simply because of their 
religious convictions.

For instance, on April 23, Mr. Yuri Panov (ph) was discussing the Bible with 
the local residents in the town of Ramon (ph) in the Veronezh Region when local 
police stopped him, falsely accused him of committing burglaries in the 
neighborhood and took him to the police station.  Because Mr. Panov refused to 
admit to the false accusations, the police handcuffed and beat him.  

The also forced him to wear a gas mask and cut off the oxygen supply so that he 
could not breathe.  After they threatened to administer electric shocks and 
sexually assault him, Mr. Panov was so intimidated that he admitted to the 
burglaries.  The police then abruptly ended the torture and stated that they 
had made a mistake in accusing Mr. Panov of any crime.  

On May 24th, police in the city of Asbest raided a religious meeting of 
Jehovah’s Witnesses without a warrant or a legal basis and unlawfully detained 
50 witnesses.  A female congregation member who was pregnant was subjected to 
police interrogations that were so coercive that shortly afterward she was 
hospitalized and suffered a miscarriage.

A 15-year-old boy, who was also in attendance, was detained over three weeks in 
a foster home despite repeated efforts on the part of his parents to procure 
his release.  

In addition to these negative developments, our administrative center near St. 
Petersburg has been subjected to repeated intrusive investigations by the local 
prosecutor’s office and numerous other state authorities with the intent of 
unlawfully closing it.  Although the prosecutor’s office has repeatedly stated 
that no violations can be found, it refuses to end the investigation, which has 
continued since November 2004.

Our appeals to the Russian courts to stop this prosecutorial abuse have been 
denied and our domestic legal remedies have been exhausted.  In March of this 
year we filed an application with the European Court of Human Rights concerning 
this matter.

In recent months, Russian authorities have also attempted to obstruct the legal 
representation and support that we received from Russian, U.S. and Canadian 
attorneys in defending our rights in the Russian courts.  

For example, in September 2008, the FSB initiated a disciplinary case against 
our Russian attorney, Igazov Chernikov (ph), who is defending witnesses in 
Asbest and – (inaudible).

On April 5 of this year, two Canadian attorneys for Jehovah’s Witnesses were 
deported, and just last month the authorities attempted to deport James Ander 
(ph), an attorney with our Office of General Counsel in New York.  

These actions by Russian authorities have made it more difficult for us to 
defend ourselves.  In his November 11, 2008 address to the Federal Assembly of 
the Russian Federation, President Medvedev highlighted all the changes that 
must be made to the present system in Russia so as to promote such worthy ways 
as honest courts and responsible leaders, freedom of religion and dignity of 
human life.

If these words become reality, then there is hope that the thaw will be felt by 
us.  (Inaudible) – the current reality is that Jehovah’s witnesses are being 
harassed, deprived of their freedom to assemble peacefully together in worship, 
slandered, coerced, physically abused, and charged as extremists by the Russian 
authorities.

Once again I would like to thank the Commission on Security & Cooperation in 
Europe for allowing me to testify about the deteriorating situation facing 
Jehovah’s Witnesses in Russia. 

SEN. CARDIN:  Mr. Cherepanov, I want to thank you for making the real effort to 
be here today, and you put some face on the issues.  We hear about the 
repression in Russia, but I think your firsthand accounts are very important 
for our work.  So I know it’s not easy to make the trip.  We thank you very 
much for being here.

Ms. Klebnikov?

MUSA KLEBNIKOV:  Good morning, and thank you for inviting me to speak.  Is this 
on?

SEN. CARDIN:  Yes.

MS. KLEBNIKOV:  Here we discuss the assassination of my husband, Paul 
Klebnikov, five years ago and the subsequent experiences with repressed freedom 
and rule of law in Russia.

All his life Paul was interested in Russia, and once he became a journalist he 
relentlessly pursued the truth.  He was highly respected for his bold 
investigative pieces on oligarchs during the Yeltsin years.  

He was appointed the first editor of Forbes Russia, and while this was 
enormously challenging, it was exhilarating for him because he believed that 
Putin was bringing needed change from the Yeltsin era and that through the 
media he could encourage Russians to find their own routes of civil 
consciousness and individual responsibility.  

As I cannot put all my energies into exposing the truth about my husband’s 
assassination, I’m happy to devote my efforts to continuing what Paul hoped for 
in Russia, bringing to towards a civil society.

Paul hoped that truth and transparency would make room for justice and 
fairness, and that a restored Russia would have much to teach the rest of the 
world.  He specifically wanted to bring American-style journalism to Russia and 
spent a great deal of time mentoring and training people in fact-checking, 
source development, styles, ethics, and all the other standards we’re used to.

Journalism is not highly respected in Russia because so often truth is ignored 
and indeed false articles are planted routinely.  There are of course many 
distinguished news publications which do adhere to our standards, like – 
(inaudible).

Six months into his job, and one day after I was sitting with him and our son 
in a playground in Moscow and enjoying a summer afternoon, Paul was repeatedly 
shocked by a group of hired Chechen hit men.  He died stuck in a hospital 
elevator that broke down.

There was much speculation about who ordered the assassination.  We do not 
believe that it was someone from the Forbes 100 list necessarily, nor a rogue 
government official, but we cannot be sure.  What we do know is that the hit 
men were hired.  They are Chechens.  Some of them are apprehended, and after a 
long and expensive case were released.

In a meeting in September 2005, President Putin informed us that Nukhayev, a 
Chechen business partner of oligarchs and a professional criminal, was the one 
who ordered the killings.  The theory was that Nukhayev was annoyed by a book 
Paul had written about him called, “Conversations with a Barbarian.”  

Others speculate that the subject of Paul’s other book, “Godfather of the 
Kremlin,” was also involved.  Investigative reporters in Russia believe that 
government agents, Chechens and Berezovsky could all be involved.

President Putin was greatly disturbed by the assassination and said so publicly 
several times.  He also asked Foreign Minister Lavrov to send me a letter in 
which it was reported that he attaches utmost importance to resolving this 
crime; that we consider it to be a direct challenge to the society and its 
democratic foundations to such holy values as people’s belief in justice, 
freedom of mind and speech, and you may be confident that everything will be 
done to ensure that those who have ordered, organized and committed this crime 
are brought to justice.

Well, after some solid police work, a case was made against the hit men, the 
case against the mastermind was never pursued, as far as I know.  I committed 
to having a lawyer follow the case through the court trial because the case was 
going to be closed to the public, and victims have standing in Russian criminal 
cases.

The trial had many irregularities and was even appealed to the Supreme Court 
and an acquittal of return, but ultimately the defendants were released.  We’re 
trying to find out if there has been any further activity since Medvedev has 
become president but do not have any information yet.  

The State Department has taken this case very much to heart, and Secretary 
Clinton, Ambassadors Burns and Beyrle have brought up the question with the 
appropriate officials in the Russian government.  They have not, however, been 
able to make much headway.  We would like a strong commitment from the 
administration to continue pursuing this case with the Russians.  

This brings up the issue of jury trials in Russia.  Over the course of the 
trial we became acquainted with many admirable Russians working in law and with 
the U.S. Department of Justice, State Department staff working to provide them 
with more skills.  

The uncertain outcome of trials reflects, I think, a general reluctance of 
jurors to accept incomplete evidence.  This satisfaction with irregular 
proceedings and misrepresentations leads to a high level of acquittals.  We 
experience these issues plus undue influence, which ultimately doomed the trial.

Nonetheless, I do believe it’s better to encourage the improvement of Russia’s 
justice system through corrections of its procedural problems than to cynically 
give up.  The general population has to be invested in rule of law.  

The relationship between rule of law and journalism is now absolutely critical 
to the survival of civil society.  Since Paul’s assassination, an additional 
nine journalists have been murdered.  None of those murders have been solved 
either, and they may not have happened at all if a different legal climate had 
been created.

One could say that the right to life is at issue.  Government control over 
society has increased since self-censorship is high in the respectable papers 
and TV is no longer considered independent.  So while professional ability in 
the media overall has improved, investigative journalism is now rare.

Without stronger rule of law, there will just be more and more dead 
journalists.  This winter the Paul Klebnikov Fund, with DOJ, invited a group of 
jurors to visit the U.S. and examine our courts and meet our judges.  I spent 
time with your organizer, a reporter from Novaya Gazeta called Nikotinski (ph). 
 

He claims that thuggish brute force often establishes how law is enforced in 
the provinces, be it by criminals, local rogue military, or the official legal 
establishment.  Legal power is not vertical; it’s local.  

Nikotinski is both a brave and rare investigative reporter.  Many of his 
colleagues have been murdered, including Anna Politkovskaya, and yet he 
continues exposing the truth, organizing jury groups, and hoping for a better 
system.

We’re also convinced that supporting moral and courageous members of the 
Russian judiciary is crucial at this time.  Our fund is launching a legal 
scholar exchange between U.S. and Russia law schools.  

The purpose is to provide respect and encouragement for the legal establishment 
in Russia and offer scholarly contacts and opportunities for both sides.  A 
desire to assist in the evolution of rule of law in Russia is not contradicted 
by the demand for its application in the case of Paul’s assassination.  Rather, 
this presents a perfect opportunity for the Russian government to demonstrate 
that law is supreme and to make it work.

I will be in Moscow during the upcoming summit and Civil Society Conference, 
which happens to coincide with the fifth anniversary of Paul’s death.   My 
family is holding a memorial service and has been told of the possible 
attendance by high-level officials from both countries.  This level of 
attention is appropriate during this summit because all should be able to agree 
that seeking justice in this case could lead to a turning point in Russia.  

My own experience is that whenever there has been a congressional resolution or 
committee letter regarding Paul’s assassination, the Russian government pays 
attention.  My request today is that you consider the people of moral 
conscience in Russia as needing your encouragement and support.

Please pass resolutions asking for the improvement of jury trials in Russia, 
encouraging the Russian president to strengthen the rule of law and, above all, 
demand justice in the case of Paul’s assassination and other – (inaudible).

Please send a strong signal to all of those who support truth, rule of law, and 
freedom of the press.  Thank you.

SEN. CARDIN:  Ms. Klebnikov, as I said in the opening, we have an obligation 
under the Helsinki Final Act to raise these issues and we’re pleased to hear 
that your belief is that the reaction to these types of actions by Congress has 
an impact with Russia.  We thank you.  

Our main objective is that reporters have an opportunity to operate freely in 
Russia without fear for their personal safety.  We know that’s not the case 
today.  So we thank you very much for your testimony.

We’re joined by Representative Issa, a member of the commission.  We’re pleased 
to have him here, and we’ll now hear from Mr. Browder.

WILLIAM BROWDER:  Thank you very much for inviting me today.  I’m very grateful 
for the opportunity to tell my story.  I’ve got an unconventional way of 
telling it with some slides.  You might not want to turn around from your desk. 
 You should have these presentation books.

The story I want to tell today, which is on page two, is about in normal 
countries there are business executives that exist.  There are government 
officials and law enforcement authorities, and there are criminals that are all 
very separate groups of people.  

And in Russia, what we discover is that oftentimes the same people are business 
executives, business executives, criminals are the same individuals.  And I’m 
going to tell you a brief story about what happened to me and how basically the 
rule of law and legal – the rule of law doesn’t exist the way we know it, and 
legal realism is rife in Russia.

A brief introduction of myself – I run an investment firm that invested in the 
Russian stock market for 10 years.  I was the largest foreign investor in the 
country.  And I became a very vocal shareholder activist, fighting corruption 
in companies like Gazprom and Chernomorneftegaz, and I did it by naming and 
shaming the companies that were involved.  In fact, I worked very closely with 
Paul Klebnikov, who was one of the most brilliant journalists out there.

As you can imagine, by naming and shaming I created some enemies – page four.  
The first consequence of that was the expulsion – the taking away of my visa 
and being expelled from Russia in 2005 on the basis that I was a threat to 
national security.

As being the largest foreign investor – foreign portfolio investor in the 
country, I tried to fight hard to get my visa back and had an opportunity – on 
page five – to meet, in the World Economic Forum in Davos, with the then-first 
deputy prime minister and now President Medvedev.  

I asked him for help with my visa, and he responded, give me the papers and 
I’ll see what I can do.  And I gave him the papers, and the next thing that 
happened was no visa, but an unusual telephone call from a member of the Moscow 
Interior Ministry, Lieutenant Colonel Artum Kuzinsov (ph) from the tax crimes 
department, who basically said, I understand you needed to get your visa 
renewed.  I’d like to have an informal meeting, and depending on what you 
provide during this meeting and how you behave, I’ll give you – your problems 
could be solved and your visa will come back.  

Well, we took that as an extortion attempt and so we refused to have the 
meeting.  And normally, when you ignore such requests they sort of disappear, 
but this was one of the times when it didn’t disappear.  And the next thing 
that happened, on page seven, was Lieutenant Colonel Artum Kuzinsov led a team 
of 25 officers on a raid on our Moscow office and on a raid of the law firm 
that we used in Moscow called Firestone Duncan.

Now, if you go to the next page, during the raid of the law firm, he started 
taking away all of their computer servers, which had all of their client 
information for 150 clients.  And one of their young lawyers protested the 
taking away of all of their other client documents.  He was taken into a 
conference room and beaten very viciously, arrested, fined 15,000 rubles and 
hospitalized.  

On the next page, page nine, the officers were particularly interested in 
grabbing four very important documents and items – the corporate seals, 
charters and certificates of our Russian investment companies – as part of 
their raid.  

The next thing that happened, on page 10, was that we no longer – we discovered 
that we no longer owned our companies.  Our name had been wiped off the share 
registry and a new company called Pluton (ph) in Targerstan (ph) had become the 
owner of our Russian companies. 

Go to the next page.  We then searched on who Pluton was and we discovered that 
Pluton was a company owned by a man named Viktor Markaylov (ph), who was a 
convicted murderer.

So, go to the next page on page 12.  How is it possible for our companies to 
change ownership, and the answer is that they give you those four documents 
that the police had seized.  And so the police basically were working with a 
convicted murderer to steal our companies.

Skip over two more pages to page 14.

The next thing we discovered was that our companies had been sued in St. 
Petersburg court without our knowledge.  A bailiff came to our office and said, 
you owe $376 million to a company we had never heard of because of a lawsuit in 
St. Petersburg.

And so we then sent our lawyers up to St. Petersburg to find out what happened 
and we discovered a big stack of forged back-dated contracts that had been 
created using the documents seized by the police.  

Go to page 15.

Although we were not aware of these cases in the St. Petersburg court and we 
had no idea that they were going on, three defense lawyers who we hadn’t 
appointed showed up to defend our companies.  

Go to the next page, page 16.

SEN. CARDIN:  Pro bono, I assume.

(Laughter.)  

MR. BROWDER:  Well, they didn’t do a very good job in the court because they 
claimed guilty.  And so, as a result, the judge awarded $376 million in damages 
against our companies to a $300 shell company that had filed a lawsuit based on 
these forged backdated contracts.

Go to page 17.

We discovered the same thing had happened in three other courts in Russia, with 
total damages against our companies totaling $973 million.  We couldn’t 
understand what they were up to until about March of 2008 when we started to 
analyze the court judgments and look at them relative to the companies profits 
in previous years.  And then it all started to make sense. 

Our companies had made, in 2006, $973 million in profits and reported those to 
the Russian tax authorities.  And the bandits then created $973 million of fake 
losses by using these courts with these court judgments to create an adjusted 
net profit of zero, looking backdated.

Well, why do they want adjust a net profit of zero – page 19 – so that the $230 
million of taxes that we paid in 2006, they could go back to the tax 
authorities and say there was a mistake made from these companies that they had 
just stolen.  And they said, we want to have the tax money back.

And, incredibly and remarkably – go to page 20 – the criminals applied for a 
tax refund of $230 million and were awarded it in two days.  It normally takes 
five years to get a $10,000 tax refund.  They were given a $230 million tax 
refund, which was probably – which I think was the largest refund in Russian 
tax history, in two days.  

Go to page 21.

The money was then sent through two Russian banks and laundered through a 
number of U.S. banks shortly thereafter.

So the crime was pretty incredible.  What was even more incredible was what 
they didn’t do when we complained about it, on page 22.  We filed about 30 
different complaints, including six 255-page complaints with the Russian 
general prosecutor and the State Investigative Committee and the Internal 
Affairs Department of the Russian Interior Ministry, along with every other 
body in Russia, and we have not received one substantive response.

The only thing that’s happened is the most cynical part of the whole thing, 
which is after stealing our companies and then stealing the tax money that they 
paid, they then are now trying to blame us.  And, page 24, they’ve opened up a 
criminal case against me for a totally unrelated issue based on a 2001 company 
that I was a director of.  

On page 25, they open up a criminal case against my chief operating officer in 
a totally different company that he was the director of.  

On page 26, they’ve opened up a criminal case against one of our lawyers who 
was the one filing all of the lawsuits against the government.

On page 27, they opened up a federal case against another lawyer from a 
different law firm, who was trying to help us bring this whole case to light.  

On page 28, they arrested and have imprisoned – he’s been in prison now on 
pretrial detention for seven months, Sergei Magnitsky, who is from the law firm 
Firestone Duncan, who did a lot of the investigative work which helped us 
expose this crime.  And there are a number of other lawyers from different law 
firms who have had to flee Russia in order to avoid this kind of persecution.

On page 29, this type of situation is – this story might be shocking, but it’s 
not unique.  This thing happens – I think has happened 70,000 times in Russia.  
There is – this is a common activity called raider activity, and there’s even a 
pricelist for this type of thing.  We found this on the Internet.  For a 
complete raider package it costs between 500,000 (dollars) and several million 
dollars.  It’s at the bottom of page 29.

On page 30, the president of Russia has rightfully declared that legal realism 
is ruining Russia, and so he thought that maybe he would do something about 
this.  And so we wrote to all 19 members of his Anti-Corruption Commission that 
was formed after he declared legal realism to be something he wanted to fix, 
and we’ve not received one substantive reply.

So what should the U.S. government do about this?  I’ve got six proposals and 
recommendations.  The first is understand the nature of the Russian state.  
This is not a functioning – the Russian government doesn’t function in the same 
way as other governments in the world.  There are many people in the government 
who are acting for their own business interests.  They’re not acting as 
patriots or government officials acting in the national interest.

And when we negotiate with them and have bilateral attractions with them, we 
have to understand that.  And I think it’s very crucial that one is not naïve 
to think that this is a country where the people who are sitting across the 
table from us are necessarily acting in the best interests of their country.  

Number three was a very important point, which is that we have very comfortably 
decided to press the reset button before the Russians have pressed the reset 
button.  And I think the Russians need to reset the commitment to fighting 
corruption and dealing with some of the issues that I brought up and the issues 
that my other witnesses have brought up before we can properly reset the 
relationship and agree that we’re all friends again.

I believe that we need to push hard for the Russians to recognize and address 
these cases, and the best way of doing that is, in some, with respect to ones 
coming up, cases like my case, the Klebnikov case and other cases, should be 
brought up very specifically and individually, and we shouldn’t be afraid to 
bring these cases up because of other issues on the agenda.  

Number five is that the Russians misuse the international criminal justice 
system very aggressively, and when they have cases like this, they will put out 
Interpol notices for people, when the real criminals are the people who are 
putting out the Interpol notices.  

And I believe that the system needs to be changed so that the Russians can’t 
just use the international legal system to corruptly fight their own legal 
battles, and there should be some type of rigorous review when it comes from a 
second-tier country like Russia and possible veto.

And the final thing is that Russian lawyers and other lawyers should be 
protected in defending and fighting for their clients.  

Thank you.

SEN. CARDIN:  Well, thank you very much for that testimony.  It’s pretty vivid 
and documented.  

The success, I think, of the Helsinki Commission over the years has been to 
bring up individual cases.  Once again, it’s easy to make a general statement.  
And when you follow it up with a specific case, as we did during the Soviet era 
on immigration issues, or as we did on freedom of religion issues, or 
restitution of property issues or an individual case, it brings a lot more to 
the table. 

It’s more difficult for the representatives of a country to avoid answering 
when you say, you know, what happened in the Browder case.  So I want to thank 
all three of you for giving us specifics today.

And the fundamental point here is rule of law, and how can you have a country 
that respects rule of law if it allows these types of activities to take place? 
 Corruption – the commission has made corruption and fighting corruption the 
center part of our strategies, and it’s fundamental to rule of law.  It’s 
widespread.  As, Mr. Browder, your testimony is in Russia, it’s going to be 
difficult to see how we can make those types of advancements.  

Another aspect of rule of law is the criminal justice system works, that you 
have some independence, and then when case are brought there is a fair 
investigation.  And, clearly, in the case of Paul Klebnikov, that was not the 
case.

And then, on the lawyers – I mean, I think that’s a very interesting point, 
that lawyers being indicted.  And it’s my understanding that the Jehovah 
witnesses, those who have tried to help the Jehovah Witnesses have been 
harassed.  So it’s dangerous to be a lawyer fighting these issues in this 
environment today.

So, Mr. Cherepanov, let me just start with you, if I might.  Is it the 
Jehovah’s Witnesses that are being singled out, or is it more widespread as far 
as religious tolerance in Russia today?  Why do you believe that the Jehovah’s 
Witnesses particularly have been singled out for this type of harassment and 
action?

MR. CHEREPANOV:  Well, of course we don’t know for sure, but what we see is the 
unequal treatment of religions.  There is the Orthodox religion, which is 
perceived as the state religion, although the constitution separates religion 
from the politics of the government, but we don’t see the equal treatment.

We are not the only ones who are singled out.  For example, recently we had 
some news on Scientologists, Mormons and Pentecostals and so forth.  The 
Jehovah’s Witnesses are operating throughout Russia, and since we are active, 
probably we are primarily targeted.

Also, we fight in courts.  Like, if our rights are violated we go to courts and 
we try to defend ourselves.  And probably this serves as a precedent for the 
local authorities.  But we believe that on the so-called religious market, if 
you can say, they want to shove off all other religions and to have green light 
on the few selected, and probably that’s the core of the issue.

SEN. CARDIN:  Are you finding it difficult for lawyers to represent you, in 
light of what’s happened against some that have come forward?

MR. CHEREPANOV:  Well, what we meet is – like you mentioned, legal realism, 
that – take, for example, we’re now advising the Republic of Volta in Siberia.  
Our lawyers went there, and the local FSB immigration authorities, they were 
hunting foreign lawyers, because the presence of a foreign lawyer in the 
courtroom brings certain discipline on the part of the judge and the 
prosecutor.  They start behaving differently and probably they become nervous.  
Therefore, the authorities try to get rid of foreign lawyers.  

But for Russian lawyers, so far is was not a major problem.  This particular 
case of the Igazov Chernikov, he was participating in defending witnesses – 
(inaudible) – work when the FSB made illegal raid on the place of worship and 
held many people for many hours.  So therefore this lawyer was very actively 
protecting them, which was too much of annoyance for the officers.

And then they instigated the case of disbarring him.  And this was kind of 
alarming.  But for other cases, yeah, lawyers didn’t have much of a problem.  
But it’s a big fight.  You know, every time you go to the court, if you’re a 
lawyer you have to make your way through and, you know, plead all the motions, 
and it’s not easy.

SEN. CARDIN:  This commission has sent letters on behalf of the Jehovah’s 
Witnesses in Russia and other parts of Europe.  We’ve also had resolutions in 
Congress.  Do you find that helpful or do you find that when we put a spotlight 
on this, there are actions by the Russian authorities that are positive or 
negative?

MR. CHEREPANOV:  What we find is that this thing, the authorities on the local 
level, they try to do it in darkness.  So whatever light is shed on what is 
going on is helpful because then they’re afraid to do wrong moves.  So, 
therefore, any attention and any publicity serves to the better.  

SEN. CARDIN:  Mrs. Klebnikov, let me talk a little bit about – has the 
government – has the Russian government been in touch with you in a substantive 
way to try to explain what happened in regards to the – 

MS. KLEBNIKOV:  Well, I met – 

SEN. CARDIN:  – this prosecution of the criminals?

MS. KLEBNIKOV:  I met with President Putin in 2005, and then subsequently met 
at least twice with Foreign Minister Lavrov, with updates on how things were 
going or not going.  And then when Ambassador Ushakov was in Washington, I saw 
him frequently.

So, in addition, Paul’s brothers and – my brother’s-in-law are in touch with 
many of the principal people in the prosecutorial and investigative branches.  
And we had a longstanding kind of dialogue going on.  That doesn’t actually 
mean we know what’s happening or that we can influence it.

SEN. CARDIN:  Well, this is a highly visible case, and therefore it’s 
understandable that the Russian authorities would want to be polite and meet 
with you.  The question is, are they – do you believe that they are acting in 
good faith to try to bring the perpetrators to justice?  Do you think that they 
don’t have the ability to intercede in the courts?

I mean, what – it seems outrageous.

MS. KLEBNIKOV:  That’s a very good question.  I think there’s a mixture of 
things.  I think a lot of the police work is really well done and is solid.  
The mastermind case and investigation was separated from the hit men.  So it 
never really got to the point of even really revealing any of the evidence on 
the hit, which obviously is the crux of the matter.

The hit men were – some of them were arrested and there was this whole case.  
The case, to some extent, was done in good faith by some of the people.  We 
were very sympathetic to the prosecutor.  He wasn’t completely able to make it 
happen the way he wanted.

There was intimidation and all kinds of problems.  I mean, it’s quite hard to 
be on a jury in a courtroom with, you know, a ton of Chechen gangsters sitting 
there staring you in the face.  I mean, it’s very unlikely that you’re going to 
really stand up and be brave and bold, though some of them were and stood up 
and voted against the acquittal.

Ultimately there has to be political will to make things come to a head.  So 
the question now is we were told there was political will, that it would be 
given, and then in fact it didn’t translate into the court action.  The supreme 
court that received the case from the Moscow city court was very fair.  They 
absolutely called it as a trial with many irregularities.  It was overturned 
and sent back.

So the answer is, it’s scattered.  Some people – perhaps the ones that don’t 
have political consequences, are earnest and trying hard and in many cases very 
professional and admirable people.  Others are maybe inept.  Others are acting 
on political orders not to go forward.  It’s really not a straight story.  
We’ve seen a little bit of everything.

But right now the ask we have is that the mastermind be revealed, that the 
evidence be analyzed, that the investigation go forward, and that if it is 
within their powers, they proceed with that case.

SEN. CARDIN:  But there is no – you don’t have a sense of confidence that the 
authorities are actually pursuing it?

MS. KLEBNIKOV:  I don’t know.  We haven’t had recent information.  I know that 
our ambassador in Moscow has just met recently with Ambassador Ushakov, who is 
the foreign advisor to Prime Minster Putin, and they’re looking into it.  
Because the anniversary is coming up and the summit, that might generate, you 
know, some focus on this case.

SEN. CARDIN:  So – 

MS. KLEBNIKOV:  But I don’t know of any actual stuff going on.

SEN. CARDIN:  But your objective is to get to the planner of the assassination 
as your top priority, but – 

MS. KLEBNIKOV:  I think – 

SEN. CARDIN:  Those who actually pulled the trigger, you want them held 
accountable – we all do – but your main objective is to go after those who 
planned the assassination.

MS. KLEBNIKOV:  There should be sincere effort to arrest and – 

SEN. CARDIN:  Now, the police work you’re referring to that you had some 
confidence in, was that also done to those who planned the assassination or 
just those who carried it out?

MS. KLEBNIKOV:  I don’t know because the case against the hit men was separated 
from the case against the mastermind.

SEN. CARDIN:  Well, we’re going to continue to raise this issue.  We have not 
only your husband but journalists are not safe in Russia today, and when the 
authorities allow these unsolved cases to go without showing a transparent 
effort to find out what has happened, it puts all journalists at greater risk.

MS. KLEBNIKOV:  I do think a lot of people really wanted to make it work.  I 
mean, Paul worked with a lot of policemen.  He worked with a lot of law 
enforcement people.  As Mr. Browder knows, he was trying to make the 
establishment work better.  Obviously that was then and things have changed and 
all that. 

But there were honest people working hard.  That’s not good enough, though, 
because the system isn’t working.

SEN. CARDIN:  Mr. Browder, this is quite remarkable evidence and a very concise 
presentation.  You have dotted all the i’s, all the dots, have brought it into 
focus here.  I mean, the numbers that add up is just amazing as to how open 
they were in their efforts to carry out their corrupt scheme.

And my question is very direct:  What response are you getting from the United 
States government in regards to this issue, and whether you have any confidence 
that this area, this issue, this case can very well be used as an example to 
further the U.S. objectives of anti-corruption in Europe, whether they are 
taking your information and are prepared to use it.

MR. BROWDER:  This is just the tip of the iceberg, by the way.  If we had more 
time – this is better than a John Grisham novel, how deep it goes.  The answer 
is – 

SEN. CARDIN:  Maybe you ought to recoup some of your losses by selling the 
rights.

(Laughter.)  

MR. BROWDER:  Perhaps.  I’ve gone to the White House and I have specifically 
asked them to put our issue on the agenda as one of the issues to raise in 
terms of improving the rule of law for – generally for foreign investors in 
particular.  And I made that request very specific, and it’s not clear to me 
whether it will or it won’t be, but I hope that perhaps – 

SEN. CARDIN:  Are you talking about in the summit?

MR. BROWDER:  For the summit.  I’m hoping that perhaps my presence here and 
your listening to my story might in some way tip the balance of probability so 
that this is something considered emblematic of what’s going on that’s 
important, and as a way of not just addressing my issue but addressing the 
issue of people who are not – who are too scared to bring their own issues up.

SEN. CARDIN:  Well, I’ll just make an observation.  I know the list to choose 
from on the summit, between – for the United States has to be a difficult and a 
long list because there’s a lot of concerns.  Let’s just take human rights for 
one of them.

There is a lot of concern on the human rights basket in the relationship 
between the United States and Russia, and what’s happening in Russia today.  
And my hope is that the administration will use this opportunity of the summit 
to raise human rights issues, whether it’s the safety of journalists of holding 
journalists responsible, and the corruption issues, and the American who in 
good faith was operating as a businessperson in Russia and has been placed at 
great risk.

Those issues – (inaudible) – the Jehovah’s Witnesses and religious freedom.  
These issues need to be raised at the meeting between our presidents.  And I 
don’t now how they’re going to make the final decision, but I’m going to be 
pushing to make sure that the human rights basket is robust at the summit 
meeting itself.

Congressman Issa?

REPRESENTATIVE DARRELL ISSA (R-CA):  Thank you, Senator.  Sometimes you never 
know where to begin, even after there has been a round of questions.  

Mr. Cherepanov – hopefully I’m halfway right on the pronunciation – I was 
raised a Mormon.  My schedulers – (inaudible).  So I have a view – I’d like to 
question perhaps a little differently than the senator did.  

Both of our religions are ones of internal family if you will; strong bonds 
within the members of the religion.  If you will, we get accused even in this 
country of being a cult.  But the one thing that you do know is that in your 
religion, in mine, you spend an awful lot of time communicating with your 
fellow members.

Is that, in your estimation, one of the biggest reasons that organizations – in 
this case religions – but any organization which tends to have a broad 
membership, feeling a bond with each other and communicating is a threat to, if 
you will, this way of doing business in Russia where you separate everybody and 
then power takes control over everyone’s life?

MR. CHEREPANOV:  Well, it’s hard to answer this question, but what we just 
observe, that like authorities treat us differently on different levels.  On 
one hand they invite us to participate in some events like cleaning the streets 
and profoundly thank us for that.  On the other hand they make us a target in 
newspapers and always, you know, there are few issues they would like to raise.

REP. ISSA:  I think they are only there for you when they need you.

(Laughter.)  

MR. CHEREPANOV:  Oh, yeah, that’s right, like when something bad is happening, 
you know, that could be to any citizen, you know, they say, okay, yeah, sure, 
this is one of the Jehovah’s Witnesses.  If something good is happening they 
say, oh, hmm, I’m surprised he’s one of the Jehovah’s Witnesses but something 
good has happened.  

You know, whatever happens they portray us like in a negative light.  But I 
think the question in Russia is, you know, Russia – (inaudible) – ideology, and 
when communism fell in 1997, the quality of national strategy – in Yeltsin’s 
time the Orthodox Church was proclaimed as – 

REP. ISSA:  The dominant church.

MR. CHEREPANOV:  Yes, of significance to the Russian society.  And I think the 
government has invested much into this ideology.

So, therefore, any region, the performance of other regions, they consider it 
as a rivalry.  And probably that’s – this is how I personally see it.  You 
know, there is no other logical explanation because when it comes again to the 
level of local governments, we have no problems.

REP. ISSA:  So diversity of thought – 

MR. CHEREPANOV:  Yeah, diversity of thought is intimidating for some of the 
authorities.  And I think they have a, you know, special forces somewhere in 
the government, and the government – the federal government – (inaudible) – in 
Yeltsin’s time and Putin’s time, and even now in Medvedev’s time – in the 
presidential administration, they say, well, we don’t have a problem with you 
guys.  You are a big religion, like you operate within the frame of the law, 
like we don’t have problem.  So our question, why is it that we have a problem 
and from whom?  We still cannot answer this question, but we know that FSB is 
very actively promoting this idea that we are a threat to national security.  
They try to say that we are a threat to the national ideology, or whatever, 
which is not true. 

REP. ISSA:  I appreciate that and you obviously have my personal sympathies.  I 
grew up listening to religious radio in this country that somehow found a way 
to think that we weren’t Christians just because we weren’t one particular 
order.  And oddly enough, my father was Syrian Orthodox, so – (chuckles) – 
which, in this country, is not so popular.  

Ms. Kleb – ah, I’m going to work on my Russian – Klebnikov – obviously, each 
time either a journalist is beaten, expelled or killed, it’s going to have a 
chilling effect on the rest of them who might stick their heads up.  After more 
than a decade of this – far more than a decade – and I’ve done business as a 
businessman in Russia.  I always say it’s the only place you ship all your 
goods wrapped in black so that they have to figure out which ones to steal, and 
if they steal them all, they’ll get yours, but that’s the only way they’re 
going to do it.  

And we really began running – and you’ve seen it, I’m sure – everything comes 
into Russia wrapped in black plastic so you have no idea what’s inside, if you 
don’t have the papers, and it still gets stolen.  But after more than a decade 
of this, you still seem somewhat optimistic that there’s a hope that somehow, 
this will change – that the light that journalists try to put onto these kinds 
of problems can, in fact, succeed and somehow, there can be a turning point.  
What makes you think that there’s a tipping point that’s positive in the 
foreseeable future?

MS. KLEBNIKOV:  I don’t think I have an exact reason for it.  It’s more of a 
principle that, if you meet people who are of moral conscience and they have 
the same values we do, we have to believe that that is something worth 
pursuing.  

REP. ISSA:  Well, you know President Bush meant Putin when he said he could see 
his soul.  President Obama has already said positive things about the new 
president.  Are these people simply too clever for Americans to properly see 
them for what they are and what they’ll do – I’m talking about strong political 
leaders that seem to – and I know you’re in a spot, a little bit, because you 
try to work them, but you know, they – and I’m going to – I think to Mr. 
Browder, I’m going to particularly add that, you know, you meet with the 
highest level and they tell you yes, yes, and then you find yourself being 
brutally attacked just when you thought you had somebody that could be, at 
least here somewhat, your honest broker.  

MS. KLEBNIKOV:  I’m really not in a position to judge if they’re too clever for 
us, but I think they’re different, and I think the way people treat each other 
does affect results.  On one hand, you want to be firm against criminal 
behavior in every way possible; on the other, you also want to be – (inaudible) 
– things that are positive.  I mean, I don’t think you have to go one way or 
the other entirely.  Mr. Browder has outrageous problems to be addressed and 
I’m just saying civil society also comes from nurturing the good people.  And 
my experience is that shaming and embarrassing people is a complicated 
approach; sometimes, we have to change how we approach it to get more results.  
I don’t know that they’re clever, but they’re definitely – (inaudible, 
background noise).

REP. ISSA:  Fair enough.  Mr. Browder, what does it cost to buy a Chelsea 
soccer team, would you say?  Less than what you were taken for?  

MR. BROWDER:  No, more.  They had to run a couple of these schemes.

REP. ISSA:  – a couple of these in order to get it, so – and would you say 
that’s likely what happens, is these scams lead to large purchases outside of 
Russia of that sort – not specifically that one, but of that sort?

MR. BROWDER:  Well, the interesting thing about Russian crime is that the 
Russian criminals are just as scared as the property rights in their own 
country as everybody else is, so once they get away with the loot, it’s not 
safe to keep it in the country because someone else will come after them, next 
thing.  It’s just an unstable place for even the criminals.

REP. ISSA:  And you chose to go there and invest a tremendous amount – and I 
know there’s not time to look at the whole history of that – but you know, when 
the Berlin Wall fell and particularly when the Soviet Union fell apart, I was a 
private citizen making, of all things, car alarms.  And Europeans experienced 
an amazing event, which was that people from Russia bought one-way tickets to 
Western Europe sightseeing and they left with European cars. 

My business went through the roof with Russians wanting to buy car security 
systems to protect what they’d stolen.  (Laughter.)  You know, this would be 
even funnier if it weren’t actually true.  This has obviously been going on 
from before you came to Russia and through the entire period, but apparently, 
you had a period of success.  Did that sort of lull you into believing that as 
long as you played by Russian rules and were extra careful and had personal 
bodyguard, I’m sure, the whole time you were there, that somehow, you could win 
in this environment?

MR. BROWDER:  My premise, when I arrived there and started investing in sort of 
my business in 1996 – 

REP. ISSA:  I know you had a full head of hair and none of it was gray.  

(Laughter.)

MR. BROWDER:  Well, the premise was that Russia was horrible, but that it was 
on the transition to bad, and that you could make a lot of money from horrible 
to bad, and that we could actually help the transition by shining some bright 
light on some of the bad practices, which is what we do very, very visibly with 
exposing corruption in some of the Russian companies.  

And interestingly, it appeared as if the government, from about 1999 to 2003, 
were on our side, because we would expose some major theft of Gazprom and all 
of a sudden, the guys that were responsible for the theft would be fired or the 
scam would get shut down, naming and shaming through the public media.  

And then, all of a sudden, things changed.  I think they changed after the 
arrest of Mikhail Khodorkovsky.  When you take the richest guy out and you 
stick him behind bars and you put him in a cage so that everybody can see him, 
then what does the 17th-richest guy do?  He says well, maybe I shouldn’t be 
making these types of noises.  Basically, after Khodorkovsky’s arrest, then 
everybody got scared, and then we were no longer getting any support from the 
government.  

And so, I mean, it’s a complicated story, but we were on the transition from 
horrible to bad and I think we’d made a lot of progress.  And then, all of a 
sudden, progress stopped and now we’re on the transition from bad back to 
horrible, and that’s why I find this situation so upsetting.  It’s not just 
upsetting for me, but it’s upsetting for, you know, 139 million anonymous 
Russians.  I think the country’s occupied by two dishonest people in positions 
of power, but there’s a lot of good people here.

REP. ISSA:  But Gazprom was not at the local, provincial level; it was at the 
level of the president.  I mean, this was a chief executive decision, supported 
by the trappings of the judicial system.  I mean, there wasn’t any doubt, at 
least here, on that, was there?

MR. BROWDER:  Basically, all of the major companies – all the strategic 
companies – have high-level involvement from the decision-makers, because it’s 
different than America, where the businesses are separate from that.  And so 
whatever goes on in those companies goes on with the knowledge and one could 
say blessing of the people – 

REP. ISSA:  So sort of General Motors and Chrysler, but not the same.  

MR. BROWDER:  Well, in those cases, what’s good for those companies is good for 
America, or whatever, but in Russia, what’s good for some of those companies is 
good for certain, specific individuals who are sitting in positions of power.

REP. ISSA:  They had the brass ring and then they slipped away.  The theory has 
always been, you know, you help them join all the clubs, and if they join the 
clubs, then they’ll behave better because they’re inside.  China, of course, is 
a WTO member.  It may not be in your portfolio, but I assume you’re at least 
familiar.  From the standpoint of our policy, do you think the president should 
be cautioned to give no carrots except those which are later earned, or do you 
support the idea that some of these organizational memberships could, in fact, 
make a difference?

MR. BROWDER:  My personal opinion is that the Russians are very zero-sum 
negotiators, and there’s no such thing as doing a favor and then getting a 
favor back.  You want something, you say here’s what I’m going to give you, and 
here’s what you give me.  

REP. ISSA:  They want to see the money across the table simultaneously.

MR. BROWDER:  Exactly, in escrow at the same time.

REP. ISSA:  Very good.  Thank you all for coming here.  I don’t know whether – 
how to place the personal persecution of a tragic murder or your financial loss 
on the appropriate planes.  They’re all pretty terrible, and it does appear as 
though, as you said very well, we’re going from bad to horrible again.  And 
that may be the challenge for the president when he goes to Moscow, is getting 
it from horrible back in the other direction, at least moving.  Thank you.

SEN. CARDIN:  Thank you very much for your comments and your questions, and 
it’s clear to all of us that Russia’s potential will be very much impacted by 
failure to deal with these issues.  It’s going to affect international 
participation of Russia and development of its economy and its potential and 
it’s people, and that’s one of the reasons – history has taught us that this is 
one of the reasons why this is of interest to all of us.  

We’re very much interest in improving relationships between Russia and the 
United States; we have a lot of common areas of interest.  But these matters 
need to be brought up, and we certainly expect that President Obama will raise 
these types of issues, if not your specific issue, during the summit here.  So 
thank you all for your testimony – extremely helpful.  

MR. BROWDER:  Thank you.

SEN. CARDIN:  Our next witness is on to Sarah Mendelson, director of the human 
rights and security initiative at the Washington-based Center for Strategic and 
International Studies.  As I understand, Dr. Mendelson has been involved in 
President Obama’s upcoming trip to Moscow, and she was certainly present during 
the former panel, so she may have some comments that will be very helpful to us 
in trying to sort out how we move forward with the meeting between President 
Obama and the president of Russia.  Dr. Mendelson, it’s a pleasure to have you 
here.

SARAH MENDELSON:  Thank you so much.  Good to see you.  Thank you.  Chairman 
Cardin, members of the commission, thank you for inviting me to participate in 
this hearing on current developments in Russia.  It’s an honor to be here.  My 
comments today address the important question of whether we’re seeing something 
of a thaw in Russia today.  

Below, I suggest some metrics for assessing change in Russia, and I argue that, 
no matter what, we need a new U.S. approach for engaging Russia civil society, 
both from the governmental and nongovernmental perspective.  I’ll explain why I 
think a new approach is timely and needed and how I think it might relate to 
the upcoming summit.  

First, is there change?  Russia has experienced a rather stark democracy and 
rule of law deficit in recent years.  You’ve just heard from other panelists 
about this.  I’ve testified before you many times, drawing on survey work that 
I’ve done with colleagues in Russia about the way in which Russians experience 
this rule of law and democracy deficit.  

At the same time, I’ve also discussed with you how the ability of the United 
States to lead on issues relating to democracy and human rights has been 
negatively affected by specific policies having to do with torture, indefinite 
detention and Guantanamo.  These policies limited the effectiveness of American 
decision-makers to push back on authoritarian regimes.

In fact, each time I’ve had the privilege to appear before you in recent years, 
it seemed that the news grew worse.  Political conditions inside Russia were 
declining and U.S. soft power was diminishing.  Today, on many different 
levels, I believe we are in a new era, and I come before you slightly more 
optimistic, although still cautious.  At home, while still very early in the 
new administration and with progress slower and more uneven than some of us 
would like, the Obama administration has begun to get our house in order.

I hope that Congress facilitates, and not impedes, that progress, especially in 
terms of closing Guantanamo, repairing the damage to U.S. soft power and 
reversing the departure from human rights norms that characterized previous 
counterterrorism authorities will provide the Obama administration strategic 
and moral authority and it will, I believe, have positive consequences for 
their Russia policy.

Meanwhile, in Russia in recent weeks, we’ve seen some small changes in how the 
authorities relate to civil society.  These have been mainly rhetorical in 
nature, but changes nevertheless.  Specifically, President Dmitry Medvedev has 
taken several symbolic steps.  His first interview in a newspaper was to Novaya 
Gazeta.  This, of course, is the newspaper where four journalists have been 
killed since 1999.

He reconvened and met with his council on human rights that is populated by 
genuine rights defenders, and he launched a review of the NGO law that has been 
so vilified since its adoption in 2006.  While the results – the changes to the 
NGO law – are by no means as comprehensive as they might have been, on June 17, 
2009, Medvedev submitted a revised law to the Duma for consideration.

These actions contrast with starkly negative rhetoric, articulated since 1999 – 
summer 1999 – by numerous senior Russian officials concerning human rights, 
foreign assistance and the nongovernmental community.  I want to argue that it 
was long before the arrest of Mikhail Khodorkovsky that the situation for human 
rights defenders in Russia became tenuous.  That rhetoric, in fact, generated 
the hostile and often dangerous – sometimes lethal – atmosphere in which 
activists and journalists live and work in Russia.  So the current changes in 
rhetoric are, in my mind, noteworthy.

But the question is, were these steps simply the, “week of democracy,” as 
Russia’s Newsweek has suggested?  I was in Moscow in April, and consulted with 
lots of folks and in dozens of subsequent e-mails with human rights colleagues, 
we’ve been puzzling through this.  I will tell you that among key civil society 
actors – and I think within the Obama administration – there’s a growing 
consensus that the best response, for now, is to act as if these gestures do 
signal a shift; the “as-if” stance is practiced even by those who have 
previously experienced very severe pressure by the Russian authorities.  

The reality is, we don’t know, until more time has passed and more research has 
been done, whether we’re experiencing a thaw, and why it’s occurring.  In the 
meantime, let me offer this working hypothesis:  It is possible that we’re at a 
rare, critical juncture – the political equivalent of a perfect storm – where 
we have a new administration in the U.S. that has said it’s focused on 
President Medvedev, not Putin, offering a possible reset of the relationship.  

Coupled with that, we all find ourselves in an economic crisis, and that, in 
turn, has possibly frightened some criminal officials as they realize that 
they’ve been overly controlling of that civil society and that civil society 
will need to play a role in tackling some of the social problems that confront 
Russia, just as we need, in the United States, a robust civil society.  We 
need, therefore, I think going forward, to develop of very specific set of 
metrics to gauge the opening or continued closing of politics in Russia, and I 
offer just a few.

Is there serious movement to bring the murderers of Paul Klebnikov, Anna 
Politkovskaya, Stanislav Markelov, Anastasia Baburova, among others, to 
justice?  Is the number of journalists and lawyers killed decreasing or 
increasing?  Is the judiciary increasingly independent, or not?  Are Kremlin 
critics allowed to return to national television?  An empirically based 
assessment of these and other relevant questions will help Obama administration 
officials identify opportunities, as well as monitor continued challenges.  

So the answer to most of these questions, at the moment, I fear, is still no.  
So we don’t want to exaggerate what we’re seeing happen in Russia.  On the list 
of small, promising signs of change we’ve seen in recent weeks, I very much 
hope we will be able to add the neutral, and even positive, engagement by 
Russian authorities at the U.S.-Russian civil society summit, to be held during 
the July visit of President Obama to Moscow.  I am one of the co-conveners of 
this meeting, along with Horton Beebe-Center, president of the Eurasia 
Foundation, and Andrei Kortunov, president of the New Eurasia Foundation in 
Moscow.  

How that meeting unfolds will provide an additional metric concerning the 
opening or closing of political space in Russia, although I should be clear 
that’s not its primary purpose.  I want to also recommend my colleagues from 
Human Right First – their written testimony – where are also signaling to the 
Obama administration that we’ll all be looking to see whether or not senior 
Obama administration officials meet with and support human rights and civil 
society.  We think that will be an important indicator of their interest, as 
well as looking at internal conditions inside Russia.

So why are we organizing this civil society summit in Moscow, a question I ask 
myself as we are struggling, just 10 days out from leaving, gathering passports 
and tickets and visas.  This has been a truly complicated endeavor.  Speaking 
for myself and not for Mr. Beebe-Center and Mr. Kortunov, I felt that it was 
very important that the summit not only be about government-to-government 
relations and that it not only be about arms control and arms reduction, 
however important.

I thought it was very important that there be an element of civil society and, 
absolutely, human rights, inserted, and it’s not the kind of thing that we 
could expect or wanted the governments to arrange.  It was really – the onus 
was on us, in civil society, to organize this summit and then to be there and 
hope that the governments will come and engage with us.  But there’s another, 
longer-term reason:  For nearly 20 years, with some important exceptions, the 
primary way in which American and Russian civil society have engaged one 
another, often with very welcome support from USAID has been to bring Americans 
to Russia to train and teach.

I’ve been a part of this democracy-assistance industry, working in the 
mid-1990s for the National Democratic Institute.  I’ve studied this approach 
extensively, and in the past, I’ve been a strong advocate for it.  I believe, 
however, by 2009, the era of American trainers going to Russia and regarding 
Russia as a problem to be fixed by the United States should come to an end.  
Certainly, inequalities in institutional development in our societies do exist, 
and civil society uneasily coexists in Russia, as I’ve noted and others have 
noted, with pressure from the authorities.

But all that said, the approach that we have taken over the last 20 years does 
not appear to be helping create more space for our colleagues in Russia.  It 
does not appear to be helping our colleagues increase their capacity to address 
problems in their society.  Instead, it appears to be ineffective, inefficient 
and increasingly unwelcome.  The era of assistance, I argue, ought to give way 
to one of engagement.  So we’re looking to July as an opportunity, but it’s 
also an experiment.  We have about 60 civil society leaders, all from the 
nongovernmental sector, coming together over two days to explore what sorts of 
activities might make U.S.-Russian nongovernmental cooperation more meaningful, 
and how best to engage our governments on a variety of issues.

And what makes our July meeting different from previous gatherings is that the 
majority of the Americans that are participating in this work on issues and 
problems here in the United States and are coming together with colleagues, 
peers in Russia to discuss joint problems.  These include practitioners and 
experts who work on non-infectious disease and maternity health in the United 
States and Russia, work on community development and affordable housing.  We 
have human rights activists who’ve led efforts in the United States to end 
torture, detention without charge, and close Guantanamo, and they’re going to 
be engaging with their counterparts from the very robust Russian human rights 
community.

We have working journalists discussing new media and possibly sharing content.  
We have experts on higher education exploring how to make sure that the next 
generations in both countries are knowledgeable about one another.  And we have 
environmentalists meeting together with environmentalists.  We’re by no means 
the only ones who thought the Obama-Medvedev summit in Moscow would be a 
promising time to explore the possibility of a new approach.  Various Russian 
colleagues, apart and separate from my co-conveners in Moscow, have been 
circulating ideas of how to make U.S-Russian civil society relations more 
robust.

There was a Washington Post op-ed by Ludmilla Alexeeva and Gregory Shvedov at 
the end of March, just before President Obama met President Medvedev in London. 
 Those and other ideas are ones that we want to explore.  We expect to discuss 
specific recommendations, and we hope to share our findings in Moscow with both 
governments.  The breadth of civil society in the United States and in Russia 
will not be represented fully at our July summit.  We had something like 70 
days to put this together, and very few resources.  

We see this as a modest first step.  We hope it is a catalyst for future 
projects.  We hope that when the presidents come together sometime in the next 
couple of months or in the next year, that there will be, again, a civil 
society summit.  We think that scaling up this effort – that is, expanding it 
so that it moves from a more elite audience to a more public one is one of the 
challenges, among many, that we need to address in short order.  Thank you.

SEN. CARDIN:  Well, Dr. Mendelson, thank you very much, and we certainly wish 
you well with the summit for civil societies.  I think it’s an extremely 
important effort.  Let me first start with agreeing with your observation about 
the United States, and taking the OSCE commitments and taking human rights 
seriously ourselves, and doing self-evaluation and action which is credible 
internationally so that the United States can, again, be a stronger leader on 
these issues in the international forum, and certainly, be in stronger position 
on summit meetings with world leaders.  I agree completely with you.

I want to just as a fundamental question to start off, and that is, you went 
through a list of questions and answered them no at the end.  And the question 
is, the administration’s trying to reset the button with Russia; can human 
rights be part of that discussion, or is that a distraction to what the 
administration is trying to achieve in developing a closer working relationship 
with Russia on the most pressing international security issues?

MS. MENDELSON:  I believe – my sense of what the Obama administration is trying 
to do is to, if you will, walk and chew gum at the same time.  I think that the 
organizing principle that is guiding a lot of what administration officials are 
doing as they engage with the Russian government is to do two things at once.  
They can, on the one hand, engage in strategic arms reduction discussions; at 
the same time, they can discuss and prioritize human rights – that it’s not a 
one or other.  

And I think that there are a couple different ways that we might look to see 
the Obama administration do this when he goes to Moscow, or even before.  For 
example, I very much hope that he speaks about our own journey, about what’s 
been going on here in the last couple months.  Certainly, obviously, this last 
election was a historic one, but I don’t think the Russia population has a very 
good sense of who he is or what his personal story is or what’s been going on.  

This country’s been in the throes of a debate about torture, about whether we 
should have an independent commission look at what’s happened over the last 
couple years that’s not been well covered inside Russia, with some important 
exceptions.  But I think it’s also important that President Obama raises, 
certainly privately with President Medvedev, human rights concerns.  As I 
understand it, he did when he met in April.  

On April 1, you’ll recall that Lev Ponomarev, a human rights defender in 
Moscow, was badly beaten just before the presidents met.  And President Obama 
did bring this up.  And it was actually through that exchange that I realized 
that Lev Ponomarev is essentially two degrees of separation away from President 
Obama – and for that matter, so are a lot of us who worked with Mike McFaul in 
the past on democracy and human rights issues in Russia.

So you know, we’re trying to, at some level, do our part.  We’re expecting the 
Obama administration to do their part, both by helping senior administration 
officials meet with human rights defenders, when they come, but also with other 
parts of civil society, and discuss how – you know, a message that was very 
common in the campaign – governments can’t do it by themselves.  There are ways 
in which civil society is absolutely critical for creating the world in which 
we want to live in.  And we need, on some level, Russian authorities to allow 
the space for human rights defenders – it’s a very huge moment, or decision, 
for the Russian government – where they want to be – and we don’t know the 
answer yet.

SEN. CARDIN:  I strongly agree with your, I guess, objective or hope – we’ll 
put it that way at this point – that the United States can very much engage in 
a much more constructive relationship with Russia on strategic issues 
concerning national security, arms control, and dealing, I hope, with a better 
relationship on isolating Iran as it continues its path towards becoming a 
nuclear weapons power.  

I think we can certainly focus on that issue, and at the same time, engage 
Russia on its commitments in regard to human rights.  And I think that manner 
in which you presented that President Obama hadn’t taken on his own personal 
life story, as well as the changes from the Bush administration and the manner 
in which he went about those changes – not in a destructive way for our 
country, but in an evolutionary way to say, look, we went off track and we got 
back on track, and it may have been under the best motivations, but it was 
wrong and we needed to make these changes.

I think he can tell that story as effectively as any person in the world and he 
can motivate change and hope around the world.  Now, having said that, I am 
concerned about the strategy of this administration as it relates to human 
rights.  The president has made some very important national visits, and the 
human rights agenda has not been, at least, in the headlines.  And to many of 
us, that has been disappointing; we thought there should have been a stronger 
emphasis in Cairo, a stronger emphasis in Turkey on human rights issues, and 
that when you’re silent on it, it can be interpreted as agreeing with the 
policies of the government where change needs to take place.

So strategies from the civil society groups – strategies for the Helsinki 
Commission – how do we encourage this administration what strategies they 
should use to make it clear we strongly support a reset with Russia as it 
relates to a better relationship, a more effective relationship, on security 
initiatives.  But we also believe that you cannot ignore and must set a climate 
for better action by Russia on the human rights front, as evidenced by the 
three witnesses we had today.

MS. MENDELSON:  Just a few points.  I will tell you that I think the overly 
personalized relationship that we saw between President Bush and President 
Putin was destructive.  It wasn’t – I don’t know that it was real, but it was 
done at the exclusion, too often, of engaging, in a robust manner, civil 
society.  So I think that the Obama administration, and President Obama 
himself, has the opportunity to make this relationship not just about 
government-to-government, not just about White House-to-Kremlin, but to really 
reach out to larger aspects of the Russian population, and particularly civil 
society leaders.  

And it’s in their interests to do so.  I agree with you that, like a lot of 
administrations when they first come in, this isn’t the first one that’s been a 
bit uneven or wobbly in their commitment to human rights.  What makes it so 
different, of course, is that we are coming off a time when the most robust 
norms of human rights – the hardest law in human rights, for example, on 
torture – has been undermined.  

And it is absolutely, I think, incumbent – and I think the human rights 
community in the United States, and I know worldwide is very anxious to see 
particularly this administration and the president himself take a very strong 
stance.  We’re waiting to see senior government officials be appointed – you 
know, legal advisor to the State Department, the head of the bureau for 
democracy, human rights and labor.  I’d like to see a director in the OSCE.  

SEN. CARDIN:  An ambassador to the OSCE would be good, also.

MS. MENDELSON:  Yes, an ambassador to the OSCE.  A directorship in the embassy 
that looked at human rights an international law, that was thinking about every 
bilateral relationship and how human rights plays a role, again, because it 
helps create the world that we want to live in.  So I think your points about 
Turkey and Cairo – and I might add the secretary of state’s visit to Asia – 
that this is a reset for them.  

They can offer a very different narrative on going and speaking about human 
rights and engaging.  And I think that if you could encourage senior White 
House officials on the political side, because it’s right now – it’s right this 
minute, today, tomorrow, Monday, you know, through the next week – that they’re 
trying to figure out what their steps should be in Moscow.  So I think kind of 
encouragement from you, Mr. Chairman, I think would be really, very welcome.

SEN. CARDIN:  I can assure you that is being done, has been done, will continue 
to be done during the next couple days leading up to the summit, to encourage 
this administration to include the human rights issues in a very visible, open 
way, during this summit.  I think it’s that important.  Let me just ask you 
about the civil society summit.  Now, what response are you getting from the 
government of the United States on that?

MS. MENDELSON:  Well, we’ve had tremendous support from embassy staff and from 
the embassy in Moscow.  I really cannot emphasize enough how helpful 
everybody’s been.  I think that, from their side, you know, the ambassador on 
down, at embassy in Moscow, and senior director Mike McFaul has been hugely 
encouraging.  

I mean, they very much want to see this happen.  They’ve been hands-off; it has 
been our initiative.  There’ve been, you know, occasionally moments where 
they’ve said, you know, have you thought about this, or maybe this person, but 
the discussion has been with colleagues in Moscow who work at the New Eurasia 
Foundation, the Eurasia Foundation and myself.

And for me, it was very important, for example, to have – a lot of this is you 
have to create a scene in your head, right?  And so the scene in my head is 
that we’ve got people who I worked with on trying to close Guantanamo – 
Americans – and President Obama comes into the room and he’s seeing all these 
human rights activists, he’s seeing people who work on the environment, and he 
sees people that he knows who have been working with him on Guantanamo.  And 
it’s not just people who are either coming to bash Russia; it’s, this is how 
civil society works, you know.  

We engage our president in encouraging different kinds of policies, and that’s 
what a robust democracy is about.  So there’s no reason to either hide or 
ignore or walk away from – we will be joined by colleagues, I think, who worked 
with President Obama in his previous life as a community organizer – some 
people from Chicago who’ve worked on affordable housing.  

And you know, I expect that he might say something like, you know, their work 
is as important as the job I’ve got going – sometimes, it may be harder, 
sometimes easier – but I want my Russia colleagues to see the richness of our 
approach, but also to be trying to give some space and time for their concerns. 
 So we hope that, mostly, our Russian colleagues will be speaking to the 
president.

SEN. CARDIN:  Let me ask – (inaudible) – obviously, issues such as public 
health or energy and global climate change are extremely important issues to 
civil society – (inaudible, background noise) – I think you mentioned that are 
common.  And I would encourage you because we need better help in dealing with 
the health issues and dealing with the – well, energy is a health issue – but 
global climate change.

And even bringing up issues such as how Guantanamo Bay should be closed would 
be an interesting subject, I think, just to talk about in Moscow.  But I hope 
you’re also dealing with issues that are controversial to the Russians.  Three 
were mentioned here today by the witnesses who’ve testified.  Because I think 
if you don’t bring those issues up, it will be historic in its absence.

MS. MENDELSON:  No, I completely agree with you, and I would say part of the 
way – when I talk about moving from assistance to engagement, there’s another 
aspect to it, which I had spoken about previously with you, which is, if you 
use the survey data that we’ve collected and amassed, we have a very good 
understanding of the issues Russians care about.  

So for example, in talking about health, for years, the U.S. government has 
funded work on health in Russia, but they’ve mostly focused on HIV/AIDS.  Not 
to say that that isn’t important, but when you actually survey Russian doctors, 
all of whom had treated HIV-infected patients, and you say, what are the most 
important healthcare crises before Russia, they list non-infectious disease, 
cardiovascular, cancer, tobacco, alcoholism – they want engagement on that as 
well.

So what I’m suggesting is that we can use public opinion in Russia – 
oftentimes, people say, well, Russians don’t care about democracy.  Well, let 
me tell you, they care about freedom from torture, they care about freedom from 
arbitrary arrest; they care that their husbands or children or nephews are not 
abused in the army.  There are all sorts of way sin which the Russian 
population is open to engagement on issues having to do with human rights, 
health, the environment, and most likely, lots of issues that we haven’t 
surveyed on.  

So we don’t need to be either embarrassed or cowed about addressing issues that 
are of tremendous importance to the Russian population, even if they seem to be 
difficult for the Russian government.  If we’re speaking with the voice of 
those people, then we can speak that much louder.

SEN. CARDIN:  Well, we look forward to the results of your summit.  Obviously, 
you probably won’t get the same public attention as the president will receive, 
but we do know that the work that you’re doing is extremely important to our 
goal, and we look forward to what you have learned from that summit.  

I really do think the jury’s out on Russia.  I think the leadership is trying 
to struggle with some of these issues in a positive way.  I think they had a 
long, long way to go.  It’s difficult to understand, at times, why they act the 
way that they do.  But we have to understand them better without compromising 
our principles and our mission to adherence to international obligations.  So 
we’re not going to compromise that, but we want to establish better 
understanding.  And with the election of new administrations in Russia and the 
United States, that gives us new opportunities.  

I think we’re all very anxious to see how the summit goes in Moscow and we will 
encourage our president to bring up these issues.  We look forward to your 
report when you’ve completed the civil society summit.  Thank you very much for 
adding to this hearing, thank everyone for their attendance, and with that, the 
commission with stand adjourned.

(END)