• Wednesday, July 24, 2024
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Kleptopia

Kleptopia

Number of pages: 434

First published in Great Britain in 2020 by Williams Collins

Tom Burgis, a reporter for the Financial Times, is certainly an impressive investigator. He works hard to explain how myriad financial institutions, from the Bank of New York to Merrill Lynch and HSBC, have tried to deceive regulators and wash the ill-gotten gains of countless dictators.

It is a fast-paced narration of a true story of the names that you’ve probably never heard of, but secretly controls a huge chunk of the world’s money.

The book reads like a spy novel and it is gripping right from the very beginning, with so many mind-blowing plot twists that prove the dirty money behind several world occurrences, from election rig in Zimbabwe, to Malaysia’s 1MDB scandal, that Saudi Ritz-Carlton Purge, to the acquisition of ABN Amro by Royal Bank of Scotland.

The story has everything, including the plunder of some countries’ assets, the privatisation of power, the usage of “front men” by dictators to manage their billions, the global money laundering network, assassination of political opponents, the jailing of whistleblowers, the prosecutions of “fall guy”, industrial espionage, bribery and extortion, fake suicide, love and kidnapping, dynastic marriage, a family fallout, stock market manipulation, and one particular chapter that explains how a certain American president fits in this network of schemes: not as someone literally implanted by Russia in the US as a puppet per se, as always suspected, but instead as one of the best in his role as a front or a launderer. Burgis draws useful parallels between Putin’s kleptocracy and Hitler’s Germany, each home to both a “normative state” that generally respects its own laws and a “prerogative state” that violate most of them.

According to the German-Jewish lawyer who was the author of the theory in the 1930s, “Nazi Germany was not a straightforward totalitarian system. It retained some vestiges of the rule of law, chiefly in matters of business, so that the capitalist economy had the basic rules it needed to keep going. But the prerogative state – Hitler’s political machinery – enjoyed … ‘jurisdiction over jurisdiction.”

Putin has used his jurisdiction over everything to vanquish almost all of his enemies. And since Donald Trump has been collaborating with Russians in one way or another for almost 40 years, our kleptocrat-in-chief does finally make an appearance in Kleptopia, on page 250. After we’ve read a lot about Felix Sater, a second-generation Russian mobster connected to several schemes including the Trump Soho in lower Manhattan, Trump is identified as the “crucial ingredient” in Sater’s “magic potion for transforming dirty money”.

Once the ratings of The Apprentice had washed away the public memory of multiple bankruptcies and “reinvented” his name as “a success”, Trump’s role in real estate deals became simply to “rent out his name”.

“The projects could go bust,” Burgis writes, and “they usually did – but that wasn’t a problem.” The money had completed “its metamorphoses from plunder to clean capital.”

Traitor

The book also talks about the Russian invasion on Ukraine. Why is the British government so very reluctant to freeze Russian oligarchs’ assets? The key, as it turns out, lies in the difference between tax evasion and money laundering.

While tax evasion sucks money out of the country into tax havens, money laundering has the opposite effect of pumping money into the country. “If you could stop yourself thinking about its origins”, remarked Burgis, “those inflows of dirty money from around the world were just another source of investment into otherwise declining economies.”

And the City of London serves as the laundromat for oligarchs (such as the Trio for Nursultan Nazarbayev – the main focus of the book – or the Russian front men for Vladimir Putin) and their dirty money, where riches from the looting of the ex-Soviet states are sent to Britain and laundered into properties, stocks, businesses, cars, fashion, and other legitimate assets, including a football club.

Hence, the infamous nickname of Londongrad, Boris Johnson’s refusal to publish a parliamentary report on Russian interference in British politics, and the Tory government’s odd decisions in regards with their stance on Ukraine invasion and the sanctions toward Russia. The major complaint that I have about Kleptopia is that this is a highly complex story with a large number of characters, but Burgis doesn’t tell it in chronological order. He jumps forward and backward in time to introduce new angles of the story, and I’m not sure that was the right structural choice. Maybe a more linear story would have been even more confusing.