Hermitage CEO Browder Ordered to Comply With NY Subpoena in Russian Money-Laundering Case

A federal judge in Manhattan has ruled that William Browder, co-founder of U.K.-based hedge fund Hermitage Capital Management, will have to comply with a subpoena related to information he provided to federal prosecutors in a money laundering case.

U.S. District Court judge Thomas Griesa said Browder will have to travel to New York to sit for a deposition, according to reports.

Browder, who lives and works in London, has already resisted previous subpoena attempts in the case, under the argument that complying with them could reveal sensitive information pertaining to the sources behind the information he provided, which, in turn, would endanger him.

However, the judge felt that the danger was not so great as to dissuade Browder from appearing on Jon Stewart’s “The Daily Show”, MSNBC and other cable networks to promote his new book.

He ordered Browder to appear on April 15th in New York for a deposition.

At the center of the dispute is a civil case brought in New York by federal prosecutors claiming Russian businessman Denis Katsyv and his company, Prevezon Holdings, used $857,354 in illicit proceeds from an alleged US$230 million tax fraud to buy Manhattan real estate. Katsyv and his company have denied the allegations.

Mr. Browder’s Russian lawyer, Sergei Magnitsky, first exposed the alleged tax fraud, and was arrested in 2008 by Russian officials. He later died in prison, and Browder has intensely lobbied prosecutors and other authorities to go after those responsible. As part of those efforts, he has campaigned to have cases related to the tax fraud pursued – including the one against Katsyv, according to media reports.

Browder, who is now a British citizen, was initially named as a primary witness in the government’s case, although ultimately the government said it did not plan to call him.

However, lawyers for Katsyv have repeatedly tried to get Browder to answer questions under oath, claiming he is the main source of information for the government’s complaint. A subpoena served in Aspen, Colorado, was quashed for lack of jurisdiction since Browder does not regularly visit or transact business in Colorado.

The same could not be said for New York, noted Judge Griesa.

Browder and late financier Edmond Safra founded Hermitage, a specialist in Russian markets, in 1996.

Source – Finalternatives

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