An excerpt from ‘Collusion’

 The End of History Not

1990–2016

Moscow–London–Washington, D.C.

The greatest geopolitical catastrophe of the twentieth century.

—Vladimir Putin, on the breakup of the USSR

Moscow, summer 1991. Mikhail Gorbachev was in power. Official relations with the West may have softened, but the KGB still assumed all Western embassy workers were spooks.

The KGB goons assigned to them were easy to spot. They had a method. Sometimes they pursued targets on foot, sometime in cars. The officers charged with keeping tabs on Western diplomats were never subtle.

One of their specialities was breaking into Moscow apartments. The owners were away, of course. The KGB team would leave a series of clues—stolen shoes, women’s tights knotted together, cigarette butts stomped out and left demonstratively on the floor. Or a surprise turd in the toilet, waiting in grim ambush.

The message, crudely put, was this: We are the masters here! We can do what the fuck we please!

The KGB kept watch on all foreigners, especially American and British ones. The UK mission in Moscow was under close observation. The embassy was in a magnificent mansion built in the 1890s by a rich sugar merchant, on the south bank of the Moskva River. It looks directly across to the Soviet Kremlin. The view was dreamy: a grand palace, gold church domes, and medieval spires topped with revolutionary red stars.

One of those whom it routinely surveilled was a twenty-seven-year-old diplomat, newly married to his wife, Laura, on his first foreign posting, and working as a second secretary in the chancery division.

In this case, the KGB’s suspicions were right.

The “diplomat” was a British intelligence officer. His workplace was a grand affair: chandeliers, reception rooms with mahogany paneling, gilt-framed portraits of the Queen and other royals hanging on the walls. His desk was in the embassy library, surrounded by ancient books. Three colleagues were neighbors. The officer’s actual employer was an invisible entity back in London—SIS, the Secret Intelligence Service.

The officer was Christopher Steele. Steele arrived in Moscow via the usual establishment route for upwardly mobile British spies: the University of Cambridge. Cambridge had produced some of MI6’s most talented Cold War officers. A few of them—it turned out to great embarrassment—had secret second jobs with the KGB. The joke inside M16 was that only those who had never visited the Soviet Union would wish to defect. 

Steele studied social and political sciences at Girton College. His views were center-left; he and his elder sister were the first generation of his family to go to university. Steele’s paternal grandfather was a miner from Pontypridd, in south Wales; his great-uncle died in a pit accident. These were the years of Prime Minister Margaret Thatcher, whose implacable opposition to the striking coal workers killed the industry. Steele wrote for the student newspaper, Varsity. He became president of the Cambridge Union, a debating society dominated by well-heeled and well-connected young men and women.

It’s unclear who recruited Steele. Traditionally, certain Cambridge tutors were rumored to identify promising SIS candidates. Whatever the route, Steele’s timing was good. After three years at MI6, Steele was sent to the Soviet Union in April 1990, soon after the fall of the Berlin Wall and the collapse of the communist bloc across Eastern Europe.

It was a tumultuous time. Steele had a front-row seat to history. Seventy years after the Bolshevik revolution, the red empire was crumbling. The Baltic states had revolted against Soviet power; their own national authorities were governing in parallel with Moscow. The Soviet Russian republic had elected a democratic president—Boris Yeltsin. There were lines; food was scarce.

There was still much to enjoy. Like other expatriates, the Steeles visited the Izmailovsky craft market, next to an imperial park where Peter the Great’s father, Tsar Alexei, had established a model farm. Here you could buy lacquered boxes, patchwork quilts, fur hats, and Soviet kitsch. Steele acquired samovars, carpets from central Asia, a papier-mâché Stalin mask, and the Tolstoy doll set—price $150—that adorned his later office.

Much of the Soviet Union was off-limits to diplomats. Steele was the embassy’s “internal traveler” and visited newly accessible cities. One of them was Samara, a wartime Soviet capital. There, he became the first foreigner to see Stalin’s underground bunker. Instead of Lenin, he found dusty portraits of Peter the Great and the imperial commander Mikhail Kutuzov—proof, seemingly, that Stalin was more nationalist than Marxist.

On the weekends, Steele took part in soccer matches with a group of expats in a Russian league. In one game, he played against the legendary Soviet Union striker Oleh Blokhin, who scored from the halfway mark.

The atmosphere was optimistic. It appeared to Steele that the country was shifting markedly in the right direction. Citizens once terrified of interacting with outsiders were ready to talk. The KGB, however, found nothing to celebrate in the USSR’s tilt toward freedom and reform. That August, seven apparatchiks staged a coup while Gorbachev was vacationing in Crimea.

Most of the British embassy was away. Steele was home and in his second-floor apartment in Gruzinsky Pereulok. He left the apartment block, turned right, and walked ten minutes into town. Crowds had gathered outside the White House, the seat of government; thus far the army hadn’t moved against them.

From fifty yards away, Steele watched as a snowy-haired man in a suit climbed on a tank and—reading from notes brushed by the wind—denounced the coup as cynical and illegal. This was a defiant Yeltsin. Steele listened as Yeltsin urged a general strike. And, fist clenched, told his supporters to remain strong.

The coup failed, and a weakened Gorbachev survived. The putschists—the leading group in all the main Soviet state and party institutions—were arrested. In the West, and in the United States in particular, many concluded that Washington had won the Cold War. And that, after decades of ideological struggle, liberal democracy had triumphed.

Steele knew better. Three days after the coup, surveillance on him resumed. Steele’s colleagues in Hungary and Czechoslovakia reported that after revolutions there the secret police vanished, never to come back. But here were the same KGB guys, with the same familiar faces. They went back to their old routines of bugging, apartment break-ins, and harassing.

The regime changed. The system didn’t.

By the time Steele left Moscow in April 1993, the Soviet Union had gone. A new country led by Yeltsin had replaced it: the Russian Federation. The KGB had been dissolved.

But its officers hadn’t exactly disappeared. They loathed the United States still. And were merely biding their time.

One midranking former KGB spy unhappy about this state of affairs was Vladimir Putin. Putin had missed perestroika and glasnost, Gorbachev’s reformist ideas, and had returned from provincial East Germany and Dresden. Putin was now carving out a political career in the new St. Petersburg. He mourned the lost USSR. Its disappearance was “the greatest geopolitical catastrophe of the twentieth century.”

A post-communist spy agency, the Federal Security Service, or FSB, had taken over the KGB’s main functions. Back home, Steele would soon move into MI6’s new purpose-built office— a large, striking postmodern pile of a building overlooking the River Thames. This gaudy Babylonian temple was hard to miss; in 1994, the government acknowledged MI6’s existence. Staff called it Vauxhall Cross. The FSB would become its bitter adversary.

From London Steele continued to work on the new Russia. He was ambitious, keen to succeed, and keen to be seen to succeed. He was part of an SIS team.

And perhaps less posh than some of his upper-class peers. Steele’s family was blue-collar. His father, Perris, and mother, Janet, from London, met when they worked at the UK Meteorological Office. Dad was forecaster to the military and Royal Air Force. The family lived on army bases in Aden, where Steele was born, on the Shetland Islands, and—twice—on Cyprus.

Steele now moved in a small world of Kremlin specialists. There were conferences and seminars in university towns like Oxford; contacts to be made; émigrés to be met, lunched, charmed. In 1998 he got another posting—to the British embassy in Paris. He had a family: two sons and then a daughter, born in France, where Steele was officially “First Secretary Financial.”

At this point his career hit a bump. In 1999 a list of MI6 officers was leaked online. Steele was one of them. He appeared next to Andrew Stafford and Geoffrey Tantum as “Christopher David Steele, 90 Moscow; dob 1964.” His future business partner, Christopher Burrows, was blown, too. Burrows’s entry reads: “82 East Berlin, 87 Bonn, 93 Athens, dob 1958.”

The breach wasn’t Steele’s fault, but it had unfortunate consequences. As an exposed British officer he couldn’t go back to Russia.

In Moscow the spies were staging a comeback. In 1998 Putin became FSB chief, followed by prime minister and, in 2000, president. By 2002, when Steele left Paris, Putin had consolidated his grip. Most of Russia’s genuine political opposition had been wiped out, from parliament, public life, and the evening news.

The idea that Russia might slowly turn into a democracy or that history, as Francis Fukuyama put it, might be ending had proved a late-century fantasy. Rather, the United States’ traditional nuclear-armed adversary was moving in an authoritarian direction.

At first George W. Bush and Tony Blair viewed Putin as a respectable ally in the war against terror. Russia’s leader remained an enigma. As Steele knew better than most, obtaining information from inside the presidential administration was hard.

One former member of the U.S. National Security Council described Putin as a “black box.” “The Brits had slightly better assets than us. We had nothing. No human intelligence,” the source said. And, with the focus on fighting Islamists, Russia was downgraded on the list of U.S.-UK intelligence priorities.

By 2006 Steele held a senior post at MI6’s Russia desk in London. There were ominous signs that Putin was taking Russia in an aggressive direction. The number of hostile Russian agents in the United Kingdom grew, surpassing Cold War levels. Steele tracked a new campaign of subversion and covert influence.

And then the two FSB assassins put a mini-nuclear poison in Litvinenko’s teapot. It was an audacious operation, and a sign of things to come. One reason MI6 picked Steele to investigate was that—unlike colleagues who had known the victim—he wasn’t emotionally involved. Steele’s gloomy view of Russia—that under Putin it was not only domestically repressive but also internationally reckless and revisionist—looked about right. Steele briefed government ministers. Some got it. Others couldn’t believe Russian spies would carry out murder and mayhem on the streets of London.

All told, Steele spent twenty-two years as a British intelligence officer. There were some high points—he saw his years in Moscow as formative—and some low ones. Two of the diplomats with whom he shared a Moscow office, Tim Barrow and David Manning, went on to become ambassadors to the EU and the United States. But Steele didn’t quite rise to the top, in what was a highly competitive service. Espionage might sound exciting, but the civil servant salary was ordinary. And in 2009 there was personal tragedy, when his wife died at age forty-three after a period of illness.

That same year Steele left MI6 and set up Orbis. Making the transition from government to the private sector wasn’t easy. Steele and Burrows were now pursuing the same intelligence matters as before but without any of the support and peer review they had in their previous jobs. MI6’s security branch would often ask an officer to go back to a source, or redraft a report, or remark, “We think it’s interesting. We’d like to have more on this.” This kept up quality and objectivity.

Steele and Burrows, by contrast, were out on their own, where success depended more on one’s own wits. There was no more internal challenge. The people they had to please were corporate clients. The pay was considerably better.

The shabby environs of Victoria were a long way away from Washington and its bitterly contested U.S. presidential election. So how did Steele come to be commissioned in the first place to research Trump and produce his devastating dossier?

At the same moment Steele said good-bye to official spying, another figure was embarking on a new career in the crowded field of private business intelligence. His name was Glenn Simpson. He was a former journalist.

Simpson was an alluring figure: a large, tall, angular, bearlike person, who slotted himself easily onto a bar stool and enjoyed a beer or two. He was a good-humored social companion who spoke in a nasal drawl. Behind small oval glasses was a twinkling intelligence. He excelled at what he did.

Simpson had been an illustrious Wall Street Journal correspondent. Based in Washington and Brussels, he had specialized in post-Soviet murk. He didn’t speak Russian or visit the Russian Federation. This was deemed too dangerous. Instead, from out of country, he examined the dark intersection between organized crime and the Russian state. Very often that meant the same thing.

One of Simpson’s subjects was Semion Mogilevich, a Ukrainian-Russian mafia don and one of the FBI’s ten most wanted individuals. Mogilevich, it was alleged, was behind a mysterious intermediary company, RosUkrEnergo (RUE), that imported Siberian natural gas into Ukraine. The profits were measured in billions of dollars.

Mogilevich wasn’t someone a reporter might meet; he was more myth than man. He lived in Moscow—or was it Budapest? Seemingly, the Russian state and FSB harbored him. Simpson talked to U.S. investigators. Over years, he built up a portfolio of contacts in Hungary, Israel, Cyprus. At home he knew individuals inside the Department of Justice—in particular its Organized Crime and Racketeering Section—the U.S. Treasury, and elsewhere.

By 2009 Simpson decided to quit journalism, at a time when the media industry was in all sorts of financial trouble. He cofounded his own commercial research and political intelligence firm, based in Washington, D.C. Its name was Fusion GPS. Its website gave little away. It didn’t even list an address or the downtown loft from where a team of analysts worked.

Fusion’s research would be similar to what he had done before. That meant investigating difficult corruption cases or the business activities of post-Soviet figures. There would still be a public interest dimension, only this time private clients would pay. Fusion was very good at what it did and—Simpson admitted—expensive.

In 2009 Simpson met Steele. They knew some of the same FBI people and shared expertise on Russia. Fusion and Orbis began a professional partnership. The Washington- and London-based firms worked for oligarchs litigating against other oligarchs. This might involve asset tracing—identifying large sums concealed behind layers of offshore companies.

Later that year Steele embarked on a separate and sensitive new assignment that drew on his knowledge of covert Russian techniques. And of soccer: in Moscow he had played defense as a fullback. The client was the English Football Association, the FA. England was bidding to host the 2018 soccer World Cup. England’s main rival was Russia. There were joint bids, too, from Spain and Portugal, and the Netherlands and Belgium. His brief was to investigate the eight other bidding nations, with a particular focus on Russia.

It was rumored that the FSB had carried out a major influence operation, ahead of a vote in Zurich by the executive committee of FIFA, soccer’s international governing body. A second vote was to take place at the same time for the 2022 World Cup. One of the countries bidding was the desert emirate of Qatar. 

According to Steele, Putin was a reluctant backer of Russia’s World Cup bid and only became engaged from mid-2010, when it appeared Moscow might lose. Putin then summoned a group of oligarchs. He instructed them to do whatever was necessary to achieve victory, including striking personal deals with FIFA voters.

Putin’s method, Steele said, was unseen. “Nothing was writ-ten down. Don’t expect me or anyone to produce a piece of paper saying please X bribe Y with this amount in this way. He’s not going to do this.” He added: “Putin is an ex- intelligence officer. Everything he does has to be deniable.” The oligarchs were brought in to disguise the Kremlin’s controlling role, Steele said, according to The Sunday Times.

Steele “lit the fuse” of something bigger, as one friend put it.

Steele discovered that FIFA corruption was global. It was a stunning conspiracy. He took the unusual step of briefing an American contact in Rome, the head of the FBI’s Eurasia and Serious Crime Division. This led to a probe by U.S. federal prosecutors. And to the arrest in 2015 of seven FIFA officials, allegedly connected to $150 million in kickbacks, paid on TV deals stretching from Latin America to the Caribbean. The United States indicted fourteen individuals.

By this point, of course, Russia had won its bid to host the World Cup. England—the country that invented soccer—scraped just two votes.

The episode burnished Steele’s reputation inside the U.S. intelligence community and the FBI. Here was a pro, a well-connected Brit, who understood Russian espionage and its subterranean tricks. Steele was regarded as credible.

Between 2014 and 2016, Steele authored more than a hundred reports on Russia and Ukraine. These were written for a private client but shared widely within the State Department and sent up to Secretary of State John Kerry and to Assistant Secretary of State Victoria Nuland, who was in charge of the U.S. response to the Ukraine crisis. Many of Steele’s secret sources were the same sources who would supply information on Trump.

One former State Department envoy during the Obama administration said he read dozens of Steele’s reports on Russia. The envoy said that on Russia, Steele was “as good as the CIA or anyone.”

Steele’s professional reputation inside U.S. agencies would prove important the next time he discovered alarming material, and lit the fuse again. 

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Excerpted from Collusion by Luke Harding. Copyright © 2017 by Luke Harding. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.

An excerpt from 'Collusion'