1
THE BUTLER BUSINESS
In June 2021, President Joe Biden and Prime Minister Boris Johnson marked eight decades since the birth of Britain and America’s wartime alliance by issuing what they called the New Atlantic Charter. Divided into eight points, like the original document—which set out the two countries’ approach to the Second World War—the new charter laid out how they should tackle challenges from climate to China and from pandemics to Putin.
Much has changed since Winston Churchill and Franklin D. Roosevelt agreed on their own vision in 1941, but one thing clearly remained constant: the strength of the bond between the two English-speaking nations.
The connections between Britain and America are profound—in foreign policy, in investment, in literature, in pop music, in the sharing of each other’s celebrities. Sometimes, the closeness leads the two countries into terrible mistakes, as with the Iraq War; sometimes, as with defeating the Nazis or filming This Is Spinal Tap, the exchange leads to something magnificent. The term Special Relationship—which was popularized, if not invented, by Churchill—has become a cliché, invoked increasingly dutifully by American politicians and increasingly needi-fully by British ones, but it still reflects a deep and enduring connection that goes far beyond what the two countries have with anyone else.
Perhaps the most remarkable demonstration of the closeness of these ties was revealed by General Michael Hayden, the former director of the National Security Agency, in his 2016 memoir Playing to the Edge. In December 2003, American intelligence operatives became concerned that terrorists armed with a nuclear bomb could attack Fort Meade, from where the NSA controls its vast data-gathering operation. Operatives were out scouring the country, looking for an Al-Qaeda cell, and their managers were in the office at all hours, despite the holiday season. They were being as thorough as they could be, but there was still a chance the terrorists would escape detection, and Hayden needed to prepare for the worst. He had to be sure his agency could continue to defend America even if the terrorists reached their target, detonated their device, killed Hayden, and decapitated the NSA. So, what did he do? He rang up his British counterpart—David Pepper, director of GCHQ, the UK’s signals intelligence (SIGINT) agency.
“Happy Christmas, David,” he said, before getting down to business. “We feel a bit under threat here, so I’ve told my liaison to your office that should there be catastrophic loss at Fort Meade, we are turning the functioning of the American SIGINT system over to GCHQ … it’s just a precaution, but if we go down, you run the show.” There was then, according to an account he later gave in a book promotional event, “a long pause.”
It is not surprising that Pepper was taken aback. The NSA is possibly the most potent intelligence agency in the world, and it is remarkable testimony to the closeness of their relationship that Hayden would be prepared to hand over such a weapon to a foreign country, to trust a foreign national to defend the United States on his behalf. We could all do with friends as reliable as that.
Or could we?
In this book, I reveal a less-known side to Britain, how it has spent decades not helping America but picking its pocket, undermining its government, and making the world poorer and less safe. While the British government’s foreign policy has been built on the bedrock of its alliance with Washington, there has always been a separate dynamic, which has treated the United States and other allies not as partners to support but as opportunities to exploit. And, fundamentally, over the last eighty years, that secret side of Britain has had a far more significant impact on the world than its avowed public policies.
In this book, I reveal that hidden side of Britain, which I fear the vast majority of people have no idea exists and which will shake anyone’s confidence in its worth as a close ally. The country’s public image is as the home of Harry Potter, Queen Elizabeth II, top flight soccer, and socialized healthcare; as an exporter of whiskey, Hollywood baddies, late-night television personalities, and endless costume dramas. But behind the scenes, there is an entirely different country, one which—in a career of writing about corruption, money laundering, and financial crime—I have gradually come to glimpse, understand, and grow alarmed by. It was an understanding that crystallized during a conversation that took place a couple of years ago, with an American academic called Andrew.
Andrew got in touch with me because he was researching Chinese money, and he knew that I act as a guide on the London Kleptocracy Tours, in which we show our guests around the British capital, point out which luxury properties belong to oligarchs, and tell the story of those oligarchs’ money. Most of the mansions that we highlight belong to Russians, Arabs, or Nigerians, but he was keen to know if any Chinese tycoons had bought hidey-holes in London, too, and what the British government was doing to make sure their wealth had been acquired legally.
We met at a café on the first floor of a bookshop in a rather grand building on Trafalgar Square—a building that, funnily enough, considering the topic we had met to discuss, Ukrainian oligarchs had swapped between them in 2016 to settle an argument in the way that my son might give a small gift to a friend after they’ve fallen out on the playground.
Andrew had come well prepared for the meeting and had a checklist to work through, which was clearly designed to generate a list of names of other people he could speak to. Which law enforcement agency was doing the most to tackle the threat of Chinese money laundering? Who was the best person to talk to at that agency? Which prosecutors had brought the best cases? Who had done the most robust research on the volume of Chinese-owned money in the UK, and what assets did that money tend to buy? Which politicians were most alert to the question, and how did they organize themselves?
Because of the shared language, Americans and Brits often think their countries are more similar than they actually are, which is something I am as guilty of as anyone. When I do research in the United States, I am consistently amazed by the willingness of officials to sit down with me and talk through their work. I call them without an introduction, and yet time and again they trust me to keep specific details of our discussions off the record. Court documents are easy to obtain, and prosecutors are willing to talk about them. Politicians, meanwhile, seem to have a genuine belief in the importance of communicating their work to a wider public, which means they’re happy to talk to writers like me. American journalists complain about their working conditions, just like everyone does everywhere, but, for a European, doing research into financial crime in the US is as heady an experience as letting my sons loose in a Lego shop.
Andrew, however, was discovering that the pleasant surprise sadly does not work in the opposite direction. I think he had been hoping that I would share a few contacts for British equivalents of the kind of people I have always found without too much trouble when I’ve visited Miami; Washington, DC; San Francisco; or New York. It’s possible that he had been concerned I would refuse to open my address book to him, but it seemed not to have occurred to him that I would have no address book to open; that, essentially, the people he was looking for would not exist.
There was no concerted law enforcement effort against Chinese money laundering, I told him, so there was no investigator who could talk to him about it. There have been essentially no prosecutions for him to look into, and there is almost no research into where the money has been going, how it’s been getting there, or indeed how much of it there is.
He kept coming at the questions from different angles, as if he thought that he just needed to find the right password to unlock the door hiding Britain’s enforcement mechanism. Where was the equivalent of the Federal Bureau of Investigation’s international corruption squad? Who was doing the work of the kleptocracy team at the Department of Justice? What about Homeland Security Investigations; did Britain have something like them? Were prosecutors building cases in a British version of the Southern District of New York? Was bringing down a big Chinese money-laundering ring the kind of case that would make their careers? Which parliamentary commissions were forensically probing this? Surely, someone was? As he talked, I began to see the situation through his eyes, which gave me a perspective I’d never had before.
The problem was that he could keep trying different passwords until the rocks rotted away, but it wouldn’t help: there was no cave of treasures for him to open. If he wanted to find out how much Chinese money was entering the UK, who was moving it, and what it was buying, he was going to have to start from scratch and do all the work himself. Andrew had come to London expecting to discover how Britain was helping to fight illicit finance, and he was discovering that this was not happening at all. Quite the reverse, in fact.
It is, of course, not just Britain that helps Chinese kleptocrats and criminals to launder money. The shadow financial system used by the Chinese criminals he was investigating is transnational by its nature. It transcends any one jurisdiction and derives its power and its resilience from the fact it does not rely on any one place: if one jurisdiction becomes hostile, money effortlessly relocates to somewhere that isn’t. And it grows all the time as lawyers, accountants, and others persuade politicians to give them access to the kind of fees they can generate by moving money around. You can find it as much in Dubai, Sydney, Lichtenstein, and Curaçao as you can in Switzerland or New York. But you find it most of all in London.
Copyright © 2022 by Oliver Bullough