Butler Britain. How the UK Helps Oligarchs and Kleptocrats

Jakub Dymek: You have a line in your interviews and articles that might come as shocking to many people in Poland and Central Europe. “Russia can only afford its war in Ukraine because Britain helped raise the cash” – you’ve written in “The Guardian”, pointing out that the UK is as guilty as anyone in accommodating Russian money. And you’re saying that although the West doesn’t finance Russia’s war any longer, it certainly helped make Russia into what it is. 

Oliver Bullough: Surely nobody but Putin is responsible for the assault on Ukraine – that is his responsibility and his crime. But Putin didn’t create the Kremlin system without help and Russia of today isn’t some sort of closed and isolated authoritarian regime of the mid twentieth century. The Kremlin is deeply connected to the western financial system, and Russia and its elites were able to spend money and benefit from offshore accounts freely. All of that was done with help. 

Whose help?

People who helped turn thieves into oligarchs and oligarchs into philanthropists and entrepreneurs – those are the people in London. Those are accountants, lawyers, bankers, reputation management professionals and politicians. They’ve sold their services to anyone that could afford them. And thanks to this industry, people whose only skills were murder and theft gained access to the western financial market and legalized their stolen fortunes. Emboldened, they’ve built an entire system on foundations of crime, plunder and murder – and this created this kleptocratic, murderous regime that we have today. It of course lays on Putin’s conscience, but there’s a lot left over for the elite in this country too. 

How does that work?

If you’re a powerful person in a country where institutions are weak – Russia, Nigeria, Malaysia – you can steal almost anything. In a way this is how the world was run for centuries, for millennia even! Somebody would steal, then somebody else would steal it back. But how offshore money works now and what it offers to kleptocrats and oligarchs is that you can keep your stolen riches somewhere where it is safe and nobody can steal it back. Like London. So you don’t have to keep your plunder in, for example, Russia. What we’re offering thiefs is the best of both worlds: they get to exploit their power at home while enjoying the rule of law overseas.

By plugging a kleptokratic system into a democratic system, you end up with a system that gives all rights of ownership and legal protection to people who don’t deserve it in the first place, because they’re just thieves. 

Why then are people mostly mad at the German and French when it comes to “aiding and abetting” Russia and never the UK?

It’s a really good question. Partly it is because – unlike for example in Germany – UK politicians have been outspoken in their criticism of Russia for a long time. 

Yet taking Russian money. 

That’s the clever part! There have always been two foreign policies. One was to be an outspoken member of NATO and to always criticize Putin during international meetings. But simultaneously, with the other hand, taking the money. The justification for taking the money always was like this – by integrating Russian money into the global economy, we’re educating them, helping them understand how business works. Essentially: we’re domesticating them, those savage Russians. And maybe in the 1990s it was forgivable to think that. “Yes, they need a few more years to learn how to really run their businesses in a western way”. But we should’ve realized 25 years ago – if not more – that this was wishful thinking. 

You admit in “Moneyland” to believing these fictions yourself at one point. 

In my defense – I was a kid. Look, for example, Poland also had its troubles and difficulties in transition to democracy, but is now a full member in the club of western countries. Everybody at some point believed that what happened in Poland, Czech Republic or the Baltics was going to happen everywhere else in the post-soviet sphere. That was naivete coming out of optimism. That didn’t happen of course. But there also were many people who were ‘naive’ long after it was sensible, not out of excess optimism, but because it was profitable for them. They were saying how trying a more free market and more business integration with Russia just a little longer is the way to go. And not even the murder of Alexander Litvinenko, poisoned with perhaps the most dangerous substance known to humans, while in the UK as a refugee, changed their minds. And many other episodes didn’t change their minds either. And yet in 2010 David Cameron went to Moscow trying to attract more money and more Russian business to London. Nothing was enough to cure the City’s elite of their very profitable belief in the future of Russia. 

This was a bipartisan effort, so to speak, in the UK?

Yes, all governments to some extent believed it was their duty to support the City of London and believed that this is “free money”. It is only recently that many politicians finally realized there is a price tag attached to it. But, on the other hand, there’s also a cross-party campaign to at least curtail some of the privacy this money enjoys. It’s depressing though that for such a long time members of both parties supported this system for so long, but it is also hopeful that this didn’t become only a partisan issue and there’s now a popular recognition that fighting this form of corruption is something everybody can get behind. Including politicians from all parties. We can see this as a glass half full. 

Can you explain to our readers, why it’s Britain – and not for example France or Luxembourg or Spain – that became such a hospitable place for offshore money?

Britain was uniquely positioned to become a capital of offshore money, because it was also the capital of an empire. When the British Empire collapsed, all the links that had existed between the center and the periphery remained in place: economic, personal, business, financial links. And in a way Britain needed a new way of making money. So the elites looked to their contacts, used their skills and found a new business model – maybe not as profitable, but still profitable enough. Instead of stealing money, we’ll help others steal money, show them how to do it efficiently, and help them move their fortunes. What’s shocking about so many oligarchs globally is that they’ve stolen from their countries, brought it to London and then moved to houses which previously were also occupied by the colonial elites who robbed their countries before them! The oligarchs, using the services of butler-Britain, are in many ways behaving in the very same way as the British colonial administrators used to. 

How many steps does it take to transform yourself from a foreign barbaric oligarch into a respected philanthropist or a member of the House of Lords?

[laughter] We don’t have so many Russian oligarchs in the House of Lords. There’s Evgeny Lebedev, who is quite unique. He is British-born, because his father was KGB head in London in the embassy. But, broadly speaking, there’s surprisingly few steps between stealing a fortune overseas and becoming a member of the British establishment – you buy a house, establish a charitable foundation, give some money to a university or two, throw parties, maybe give some donations and… you’re done. Five, six, seven years – it’s easily possible. 

There’s a whole industry of people who work to accommodate oligarchs here. To show them around, to help them integrate into the establishment. This is surprisingly easy to pull off, provided you can afford it. 

Can’t such an industry be banned?

No, I don’t think so. It can be discouraged though. But we have a huge financial center in our country. Not only banking, finance and legal services. There are private jets and private yachts, elite mansions and designers, art galleries – if you want something, you can buy it. If there’s money, everything is available. And the problem is not that it is illegal. Mostly, it’s all legal! The problem is the money isn’t. And that’s the difficult bit. And there’s no investigation into the origin of that money…

…how to change that?

We need huge investment in police agencies. Which is not happening. Without that – there’s no way for it to stop. Not without cutting Britain away from the world – and that is not going to happen. 

Is this the reason you say it is somehow unfair to call Russia or Ukraine “corrupt states” without naming the countries that help in hiding the stolen wealth?

Yes. The way we talk about corruption – that Ukraine, Argentina or Nigeria is corrupt – is just wrong. It is a misunderstanding of how corruption works. Corruption is inherently transnational. The money doesn’t stay in Ukraine, Argentina or Nigeria – it moves through multiple different places. And if the place where the money is stolen is corrupt, shouldn’t the place where the money lands be equally corrupt too? It’s the same money. 

Why is there so little outrage surrounding that? When somebody tweets something stupid about Russia and Ukraine, there’s endless rage and condemnation. When there are billions looted and sanctions quashed – with the help of western firms and elite – there’s silence. 

Well, this is complicated. When there’s some idiot from the right or left who says something stupid about Putin, it gets clipped and put on Twitter, we can see it and laugh. But when it comes to money, it’s not that easy. When somebody structures a company in a way that enables a Russian oligarch to hide his money and invest it in London – did he give him the gun? It’s also hard to write about. The people who do this are rich, well-connected and litigious. And if you write about it in a hard and truthful way, they will sue you. These people don’t want to be written about. And these stories don’t lend themselves easily to a 20 second YouTube clip. It’s difficult to write about these things in 280 characters. But it’s not all bad – offshore finance and the Kremlin’s dealings have received more attention in the last year than in a long time. So there’s progress.