Just over a decade ago Ajit Chambers had a dream. He knew that beneath the surface of London were dozens of “ghost stations”, from Aldwych to the British Museum, that had been closed down. At least some of them, he believed, could be turned into bars and tourist attractions. He had his eye on one in particular: the former station at Brompton Road, Knightsbridge.
At public meetings he pestered the mayor of London about it —and Boris Johnson couldn’t have been more enthusiastic. But then in 2014 Chambers had a nasty shock. The Ministry of Defence, which owned Brompton Road, had agreed to sell — but not to Chambers. They sold it for $88.6 million to Dmytro Firtash.
Born in western Ukraine, Firtash was a man with a history. He had made his money by acting as a middleman between the Putin government, the Russian oil giant Gazprom, the Ukrainian president Viktor Yanukovych and the Ukrainian-born, Russian-based mobster Semion Mogilevich, commonly described as the most dangerous crime lord on the planet. As the journalist Oliver Bullough puts it, Firtash was “the Kremlin’s man in Ukraine, a gas-fuelled kingmaker”.
However, none of this bothered the Ministry of Defence. Firtash was the highest bidder, so he got his way. And none of it bothered anybody else either. With the help of a couple of MPs, one Conservative, one Labour, Firtash had set up the British Ukrainian Society in 2007.
He paid for dinners and language classes at Cambridge, where he was welcomed into the university’s gold-plated Guild of Benefactors. He bought a $100 million house down the road from Harrods, and hobnobbed with John Bercow. After the annexation of Crimea he was even invited to share his views about Ukraine with the Foreign Office. And, given his past, his advice was predictable. Sanctions against Russia were a “bad idea”, he said. “America provoked Putin into this situation.”
You can probably guess how this story ends. Firtash lives in Vienna, where he has been fighting extradition to the US on charges of links to the Russian mafia. And Brompton Road Tube station? It’s still there, but nothing has changed. Firtash has done nothing with it.
After the annexation of Crimea the Putin oligarch Dmytro Firtash was invited to share his views about Ukraine with the U.K.’s Foreign Office.
For Bullough, who specializes in the recent history of Russia and the rise of financial crime, and whose books include Moneyland: Why Thieves and Crooks Now Rule the World and How to Take It Back, the Firtash story is the perfect example of Britain’s prostration at the feet of the shady super-rich. But the real problem, he argues, is bigger than our naive indulgence of a few post-Soviet-era oligarchs.
He quotes a scene from PG Wodehouse’s Jeeves and Wooster stories, in which a Bolshevik revolutionary tells Jeeves that he is an “absolute relic of an exploded feudal system”. “Very good, sir,” Jeeves says blandly.
And that, Bullough says, sums up our indifference and servility, our collective self-delusion about the role we are playing. Britain, he writes, “behaves like a butler. It’s an amoral enabler-for-hire, an enforcer-for-cash, which hides the reality of what it’s doing behind quaint traditions.”
For Bullough the roots of this lie in the Suez crisis of 1956, when the reality of Britain’s diminished post-imperial status was laid bare for all to see. It was at this point, he argues, that the City of London became a gigantic international prostitute, inventing a financial wheeze called Eurodollars — dollars unregulated by the US Federal Reserve, which bankers could move wherever they liked.
The link between this and the end of empire is never entirely clear: Bullough argues that the City needed to reinvent itself as the “amoral servant of wealth wherever it could be found”, but he doesn’t show that Suez had anything to do with it. In any case, this is the conceit on which he hangs a series of grimly fascinating chapters, each focusing on a different financial and legal loophole.
Britain “behaves like a butler. It’s an amoral enabler-for-hire, an enforcer-for-cash, which hides the reality of what it’s doing behind quaint traditions.”
One section, for example, explains how the tiny British Virgin Islands became a tax haven where the super-rich can register shell companies. Another chapter explores the murky world of Scottish limited partnerships — a bizarre anomaly whereby Scottish partnerships can behave like companies without having to publish accounts or pay taxes like them. In Scotland, he explains, eastern European criminals are registering limited partnerships, originally intended for schools and hospitals in countries such as Moldova, “on an industrial scale to hide stolen money”.
In perhaps the most remarkable chapter, he charts the birth of the Gibraltarian betting industry, which began in 1989 with a single betting shop and two telephonists, but now handles about $78 billion in British online bets. The appeal for the bookies is obvious; they don’t have to pay as much tax as they would at home. And there’s a clear attraction for Gibraltar: formerly on the brink of bankruptcy, it has raked in a fortune in tax receipts.
The only losers are legions of British gamblers, most of them poor, who end up being driven deeper into misery. About 650 suicides a year are linked to gambling addiction. But as Gibraltar’s premier blithely puts it: “In real life you haven’t got the choice of doing everything that is right.”
Could things be different? Bullough thinks so. He points out that the US is much more vigorous at pursuing financial criminals than we are, and was much more responsible about, say, deregulating its betting industry. He thinks it’s disgraceful that we have tolerated the survival of many overseas loopholes, from the Caribbean to the Rock.
And he has no time for the excuse that if we didn’t allow the oligarchs to set up shop somebody else would. Is our self-esteem so brittle that we need the patronage of people like Dmytro Firtash? Surely not.
It’s high time, he says, that “Britain made a principled decision to take a course of action not because it was profitable but because it was right”. And after recent events, who could disagree?