The U.K. Has Its Own Russia Problem

The issue of Russian interference in America’s elections has dominated headlines for four years. One of America’s closest allies, the United Kingdom, has been similarly ensnared in controversies over Russian influence during that same timeframe. On Tuesday, the Intelligence and Security Committee of Parliament released its long-awaited report on Russia’s attempts to meddle in the U.K.’s democratic processes.

The report does not cite any real evidence showing that Russia tilted the 2016 Brexit vote, as has been alleged elsewhere, or that the U.K.’s voting process has been compromised. With respect to Brexit, the committee reported that the impact of any Russian interference “would be difficult—if not impossible—to assess.” Large portions of the analysis are redacted, so it is possible that more detail is contained in a classified annex. Still, the public version does not demonstrate that Russia directly impacted any vote.

Even so, the Kremlin has meddled in the affairs of several Western democracies. The report cites suspected Russian conspiracies in: France (including providing a “soft” loan to the right-wing National Front, now known as the National Rally, “as a reward” for “having supported Russia’s annexation of Crimea,” as well as hacking the accounts of other politicians), Montenegro (where Russia reportedly sponsored a failed coup attempt in 2016), the U.K. (including an influence campaign intended to discredit the Scottish independence referendum in 2014), and the United States. With respect to the U.S., the U.K. committee firmly blames Russia for the “hack and leak” campaign targeting the Democratic National Committee during the 2016 election. The committee found that it was this latter hacking campaign that encouraged British officials to take the threat of Russian cyberwarfare more seriously.

The report contains still other allegations regarding Russia’s schemes. Vladimir Putin has overseen an aggressive campaign that takes multiple forms, ranging from disinformation, to targeted assassinations with chemical weapons, to leveraging an extensive network of Russian businessmen to advance the Kremlin’s interests. Let’s turn to that last part of the story.

Londongrad.

In my view, the most jarring section of the report deals with the role of Russian expatriates in British society. Much of this was already well-known, but it is still stunning to see an official parliamentary committee offer a summary in such stark terms.

After the fall of the Soviet Union, the U.K. government opened its arms to wealthy Russians, asking “few … if any” questions “about the provenance of” their “considerable wealth.” The result was an influx of a “lot of Russians with very close links to Putin who are well integrated into the U.K. business and social scene.” Their wealth has opened many doors for the Kremlin’s loyalists. The Russians have “invested in extending patronage and building influence across a wide sphere of the British establishment—PR firms, charities, political interests, academia and cultural institutions.” All of these, and more, have been “willing beneficiaries of Russian money, contributing to a ‘reputation laundering’ process.”

In short, wealthy Russian oligarchs relocate to the U.K., throw their money around, and are suddenly considered legitimate altruists. The reality is quite different. Russian “influence in the U.K.” is now the “new normal,” the committee warns. The Russians have fueled a “growth industry of enablers,” meaning “individuals and organizations who manage and lobby for the Russian elite in the U.K.” These “enablers” include “[l]awyers, accountants, estate agents and PR professionals,” who “wittingly or unwittingly” extend “Russian influence.”

It’d be one thing if this influence were truly a private concern. But that’s not the case. Wealthy Russian businessmen often promote “the nefarious interests of the Russian state.” Indeed, “it is widely recognized that Russian intelligence and business are completely intertwined.” This is especially true in “Londongrad”—a somewhat derisive term used to describe a Russian stratum of society across the British capital. Londongrad has been written about before, but the British press immediately seized upon the committee’s use of the term, because it is that troubling.

Londongrad was lampooned in a Russian television series, but the committee found it is no laughing matter. Much of the damage has already been done. While the U.K. government must “take the necessary measures to counter the threat and challenge the impunity of Putin-linked elites,” “any measures now being taken … are not preventative but rather constitute damage limitation.”

The Russians have built a “private security industry” that operates in parallel to the state. This security network services the “needs of the Russian elite,” such that “British companies protect the oligarchs and their families, seek kompromat on competitors, and on occasion help launder money through offshore shell companies and fabricate ‘due diligence’ reports, while lawyers provide litigation support.” Kompromat basically means “compromising information” the Russians can use to blackmail or manipulate someone into submission.

The security challenge has been made even more problematic by Britain’s lax laws, some of which date to the First World War. Unlike in the U.S., foreign agents are not required by law to register as such. The committee writes that it is “not illegal to be a foreign agent in this country,” meaning Putin can send his comrades to the U.K. knowing that their service to Mother Russia is not, in and of itself, an illegal offense.

The committee doesn’t offer any specific examples of how Russia’s leverage via Londongrad works. Again, perhaps such details are in the classified portions of the report. But the committee does warn that even members of the House of Lords have “business interests linked to Russia, or work directly for major Russian companies linked to the Russian state.” Such “relationships should be carefully scrutinized, given the potential for the Russian state to exploit them.”

Why did the U.K. tolerate the Russian influx? 

At this point, you may be asking yourself why the Brits have tolerated Londongrad. Why did they allow a number of wealthy Russians with suspicious ties to the Kremlin into the country with minimal scrutiny in the first place?

The U.K. fell into the same trap America did in the 1990s. British officials apparently assumed that “developing links with major Russian companies would promote good governance by encouraging ethical and transparent practices, and the adoption of a law-based commercial environment.” That is, some believed in a version of democratic determinism—that democracy would continue to spread around the globe and integrating Russia into the international community of nations would only speed up this process in Moscow.

It didn’t work. The Kremlin didn’t change. London did. The committee writes that the U.K.’s open arms policy was “in fact counter-productive.” It offered “ideal mechanisms” for the Russians to develop “illicit finance” schemes and funnel cash through the London “laundromat.”

Readers of this newsletter will recognize a similarity with respect to America’s post-Cold War foreign policy. As late as the Obama administration, the U.S. tried to “reset” relations with Moscow. That didn’t work either. Vladimir Putin’s Russia isn’t going to be easily transformed into an ally or neutral party.

The committee describes Putin’s objectives as “fundamentally nihilistic,” which I’m not certain is really true. Putin may very well have his own positive, if warped, vision for his home country. But it is accurate to say, as the committee does, that Putin views foreign affairs as a “zero-sum game.” What’s bad for the West is good for Russia.

The assumption that Russia would evolve into a responsible international player was also applied to China. More than 40 years of American policy were similarly guided by a naïve determinism, which has been discredited.

Russia’s alliance with China.

The committee writes at length concerning the importance of the U.K.’s alliances, especially with Western countries such as the U.S. One key reason Moscow is asymmetrically attacking the U.K. (through cyber and other intrusions mentioned in the report) is because of its special relationship with America, which is Putin’s chief adversary.

Traditionally, the committee notes, Russia has been “suspicious of building significant international partnerships.” But in “recent years” Moscow has proactively sought “alliances of convenience.” And the No. 1 actor Putin has turned to for support is Xi Jinping in China.

Russia has “deepened defense and security cooperation with China, as a useful partner against the U.S. (going so far as to conduct joint military exercises),” the committee writes. Putin’s autocracy has also “increased influence in South America” and pursued “substantive engagement in several African countries, including widespread trade campaigns.”

The report doesn’t contain much on Moscow’s growing partnership with Beijing. After all, that wasn’t its main investigative subject. But there is another point of concern that comes to mind when reading it. The committee heard testimony related to Russia’s use of private criminal actors, who can serve as cut-outs for Russian intelligence. The U.S. has been forced to confront the same type of behavior from the Chinese.

Also on Tuesday, Assistant Attorney General John C. Demers warned that China “has now taken its place, alongside Russia, Iran, and North Korea, in that shameful club of nations that provide a safe haven for cyber criminals in exchange for those criminals being ‘on call’ to work for the benefit of the state.”

The Chinese Communist Party (CCP) has allegedly used cyber thieves to steal American intellectual property, including COVID-19 research. Earlier this month, a federal grand jury in Spokane, Washington indicted two Chinese hackers for just such cyber espionage. The two men allegedly “conducted a hacking campaign lasting more than 10 years to the present, targeting companies in countries with high technology industries, including the United States, Australia, Belgium, Germany, Japan, Lithuania, the Netherlands, Spain, South Korea, Sweden, and the United Kingdom.” Some of this criminal work was for their own private gain. At other times, they were allegedly working for the CCP.

It’s worth keeping an eye on the use of criminal cut-outs by both the Chinese and the Russians. The two nations are conspiring against the U.S. and the U.K. And as the U.K. intelligence committee’s report makes clear, this new type of cyber war is heating up.