After Russian police raided Hermitage Capital Management and the law offices of Firestone Duncan on 4 June 2007, auditor Sergei Magnitsky concluded that seized corporate documents and seals had been used to hijack three Hermitage companies and obtain a fraudulent $230 million tax refund. The refund, issued on Christmas Eve 2007, was described as the largest in Russian history. Magnitsky’s investigation implicated police, tax officials, judges, bankers and organized criminals; rather than prosecuting those allegations, authorities arrested him in November 2008 and accused him of tax crimes. A later guilty plea by a sawmill foreman and investigative reporting supported the core claim that Hermitage had been victimized by fraud, although the source records continuing official disputes over senior officials’ involvement.
Magnitsky spent 358 days in Moscow’s Butyrka prison without trial. He developed gallstones, pancreatitis and a blocked gallbladder, but surgery was not performed and medical care was repeatedly denied. He died on 16 November 2009, eight days before the legal limit for detention without trial expired. A Kremlin human-rights council found he had been physically assaulted before his death, while Russian prosecutions of prison doctors ended without a conviction: Dr. Dmitri Kratov was acquitted on 28 December 2012. Russia nevertheless dismissed senior prison officials and changed detention rules, while the United States enacted the Magnitsky Act in December 2012, imposing financial and travel sanctions; the law inspired similar measures in other countries. A Moscow court posthumously convicted Magnitsky and Bill Browder in absentia on 11 July 2013.
