Cornucopia

  *

  When the news was announced that Swiss prosecutors had searched offices of the Geneva subsidiary of the City & Colonial, in an inquiry into alleged money-laundering, it brought a certain relief to Michael Fitzwilliams.

  It would be very difficult for Hainsworth to stir up problems at INI whilst his own bank was under siege, suspected of aggravated money laundering at its Swiss private bank and its offshore branches. On top of that American tax authorities were pursuing investigations of tax evasion by its citizens via City & Colonial’s offshore branches.

  Fitzwilliams was only too well aware of the arrangements, it was a long standing part of the British establishment’s banking traditions. Friends, and friends of friends, had offshore accounts where they illegally hid undeclared money from the taxman. What banker would refuse a government appointment or peer-hood for services rendered to powerful politicians and their families, or highly placed establishment figures, including royalty. Fitzwilliams was not complaining about that, what was eating into him was the political conniving that had cost him his position as CEO of INI, and he was not going to let that pass. With the elections coming up he still had some cards to play.

  He called James Herring, whose advice had the effect of a cold shower. The lawyer explained his role could not be confounded with that of a victim if untoward actions were discovered, if anything he was an accomplice and could be charged in a criminal investigation for fraud and tax evasion, since at that time, as the legal head of bank he would be considered as an accomplice, guilty of aiding and abetting unlawful tax evasion.

  However, political pressure could be brought to bear on City & Colonial, which was also facing criminal investigations in other countries, notably the US, France, Belgium and Argentina, though for some strange reason not in the UK, which pointed to the probability of a cover-up at the highest levels, where offshore accounts proliferated, which as such were not illegal, though tax evasion was.

  RUSSIA

  Fitzwilliams had totally misread the risk of getting involved in Russia, and he knew it. It was not the fault of Sergei Tarasov, or anybody else for that matter. Western leaders had misunderstood the intentions of the man in the Kremlin, and even some of those close to him had gotten it horribly wrong.

  The banker was not the only one who had listened to the encouragement of politicians and advisors who imagined economic ties could be exchanged for political compromise. It was not the first time leaders had made the same mistake. Putin’s was not discouraged by the potential loss of trade relations with the EU, when it came to his Eurasian Economic Union ambitions, especially when he was selling oil at over one hundred dollars a barrel.

  In measuring the mood of the Kremlin, London and Brussels had catastrophically miscalculated. They had not realized that the Kremlin saw the Ukraine as being historically speaking part of their nation, it was not another Poland or Hungary.

  As usual the Foreign Office, to which MI6 reported, had made cuts, paring back on intelligence resources and analysis, not through their own fault, but rather that of transient politicians and their vote winning policies: politicians who had imagined Russia could become a democratic partner. Nothing was further from reality. All Russia’s long history had been one of authoritarian rule, even if Alexander III and Nikolai II had introduced reforms. As for Joseph Stalin many of his despotic ideas were still alive and kicking.

  Were politicians and businessmen warned? Probably not, in any case men like John Francis knew from long experience it didn’t pay to tell the truth to those who did not want to hear it.

  Moreover, what could Blair, Cameron or Sarkozy possibly know about Russia. Angela Merkel on the other hand knew quite a bit. She had grown up under Communist rule in the Democratic Republic of Germany, where Russian presence was all pervading. Not only that, her communications with Vladimir Putin were unhindered by linguistic and political cultural barriers, he had been a KGB agent in Germany and had a perfect command of German, she had learned to speak Russian fluently at school, winning prizes for her proficiency in the language.

  What would Putin pull out of the bag next? The Baltic states held sizeable minorities and pressure could be put on discordant EU members with little effort. Whilst Nato generals wanted to send strong signals to the Kremlin, Nato would never sanction a war on Europe’s doorstep, and Putin knew it.

  But even Putin miscalculated. In 2013, the price of Russian Urals crude oil: a mix of heavy and high grade oil from the Urals and Volga regions with West Siberian light, had oscillated around one hundred or so dollars a barrel.

  At that time most so called experts had estimated the average annual price of Urals crude would steadily increase, reaching an average of one hundred and sixteen dollars a barrel by 2016. No one had imagined that by early 2015, prices would plunge to less than forty dollars a barrel.

  The significance of this was that up to that point in time oil had played an almost overwhelming role in Russia’s economy with fifty percent of its federal budget revenues coming from mineral extraction taxes and export duties on oil and natural gas.

  The effect was catastrophic: for every drop of one dollar in the price of Urals crude, Russia lost about two billion dollars in revenue.

  If Putin, whose duty as president of the Russian Federation was to have his finger on the pulse of the planet, had been caught unaware by geopolitical issues, then Fitzwilliams could be excused, at least in part, for his failings to do so as CEO of INI. To his everlasting regret, such issues had been of little interest to him. Profits, growth and international expansion had been his driving interest, and now it seemed his downfall.