Ruling

02176-18 Chandler v The Mail on Sunday

    • Date complaint received

      22nd November 2018

    • Outcome

      No breach - after investigation

    • Code provisions

      1 Accuracy

Decision of the Complaints Committee 02176-18 Chandler v The Mail on Sunday

Summary of complaint

1. Christopher Chandler complained to the Independent Press Standards Organisation that The Mail on Sunday breached Clause 1 (Accuracy) of the Editors’ Code of Practice in an article headlined “Putin link to Boris and Gove Brexit 'coup'”, published on 26 November 2017, and an article headlined “Secretive institute behind No 10 ‘hijack’ letter faces probe by charity watchdog”, published on 3 December 2018.

2. The articles were published as part of a wider investigation by the newspaper into allegations of Russian influence in British politics, in particular, the policy decisions behind the UK’s exit from the European Union.

3. The first article reported that a “Russian link to Boris Johnson and Michael Gove’s successful plot to persuade Theresa May to take a tougher stance on Brexit” had been revealed by the newspaper. The article identified the complainant as the Russian link. It explained that a “secret letter” sent to the Prime Minister by two government ministers had been co-ordinated by a senior figure within a UK think tank, the Legatum Institute Foundation, which had been founded by the complainant.

4. The article reported that the complainant had “netted millions” from Russian gas deals following the collapse of the Soviet Union. The article said that a “leading MP” had called for an investigation by Parliament’s intelligence and security committee “into Legatum Institute and its influence on the government”. The online article made one reference to the complainant as a “Russian tycoon”; it also reported that the complainant was born in New Zealand.

5. The complainant, along with his three partners, founded the Legatum Group in 2006: this is a private investment partnership based in Dubai. The Legatum Group, through its philanthropic arm, Legatum Foundation Limited, is a donor to the think tank, the Legatum Institute Foundation; the first article under complaint reported that the Institute received £3 million in funding last year, of which £3.9 million came from the Legatum Foundation Limited. The Legatum Group and the Legatum Institute Foundation have each made clear that the Legatum Institute Foundation is an entirely separate entity from the Legatum Foundation Limited and operates as an independent charity.

6. In the years 2000 and 2001, the complainant’s company, Sovereign Global, was a minority shareholder in Gazprom.

7. The article reported that the complainant had “helped President Vladimir Putin’s associates take control of Russia’s state energy giant Gazprom”. It explained that in 2000, shortly after Putin became Russian President for the first time, the complainant “angered by the corruption [he] had witnessed in Gazprom, [was] credited with helping to trigger a boardroom coup which subsequently led to Alexey Miller being installed as head of the company”. The article reported that Mr Miller was a “close ally and confidant of Putin”.

8. The article reported a statement from a spokesperson from the Legatum Institute regarding Sovereign Global and its alleged involvement in the changes to Gazprom’s board:

“Sovereign Global sided with many minority foreign and domestic investors to improve the corporate governance of Gazprom by lobbying for better management. [It] did not have the power to place anyone in a position of authority at Gazprom. It was the Gazprom board that installed Alexey Miller. No one from Sovereign Global Investment ever personally met with President Putin, chose Miller for his role or even vetted him.”

9. The second article was a follow up piece, which reported that the Charity Commission had launched an inquiry into the Legatum Institute. It said that “the controversial think tank which played a key role in the secret Brexit Letter… is being probed by Britain’s charity watchdog”. It reported that the inquiry by the Charity Commission had followed the newspaper’s investigation into the Institute’s “secret role in pushing the Government towards a ‘hard Brexit’ withdrawal from the EU”. The article identified the complainant and reported that “his allies cut deals with President Vladimir Putin’s associates”.

10. The first article was published in substantially the same form online on 25 November 2017, under the headline: “Putin’s link to Boris and Gove’s Brexit ‘coup’ revealed: Tycoon who netted millions from Russian gas deal funds think tank that helped write the minister’s letter demanding May take a tougher stance on leaving the EU”. The second article was published in substantially the same form online on 2 December 2017, under the headline: “Secretive institute behind Boris and Gove’s Brexit letter to ‘hijack’ Number 10 faces probe by charity watchdog”.

11. The complainant said that the articles had created a wholly misleading impression of his role, the Legatum Institute Foundation and - insofar as connected to them - Russia in the UK’s Brexit planning. He said that on that basis, the article had seriously misled the public concerning a matter of great public interest.

12. The complainant denied using his influence to trigger a boardroom coup to install Mr Miller to the CEO of Gazprom. The complainant explained that in May 2000, along with other minority shareholders, he had backed a campaign to elect a single minority shareholder representative director, Boris Fyodorov, to the board of Gazprom. The complainant said that Mr Fyodorov’s appointment was spearheaded by United Funding Group, which acted as custodian of between 6% – 8% of Gazprom’s shares at the time. It was UFG which co-ordinated the minority shareholders to help effect this change to the Gazprom board, with Mr Fyodorov as their representative board member.

13. The complainant said that Mr Fyodorov was not an ally of Putin’s, and was independent of the Russian government. The complainant said that it was this reconfigured board of directors that voted to emplace Alexey Miller as the CEO of Gazprom in May 2001, ten months after the appointment of Mr Fyodorov. The complainant said that he would have had to be a clairvoyant to have foreseen the result of the actions of the minority shareholders some ten months earlier. He said that at no time did he have any ability to influence or affect the composition of the Gazprom board which replaced the former CEO in May 2001.

14. The complainant referred to an article published by the Institutional Investor, dated March 2006 which stated:

At [Gazprom’s] annual general meeting in July 2000, Sovereign and other minority investors succeeded in getting Fyodorov elected to the board over a management candidate. By teaming up with the five government appointees, who were sympathetic to complaints about management abuses following the election of President Vladimir Putin in March 2000, Fyodorov changed the balance of power at Gazprom. In May 2001 the board removed Vyakhirev as chief executive, kicking him upstairs to the largely ceremonial position of chairman, and installed Alexey Miller, then deputy Energy minister, as his replacement.”

15. The complainant said that the first article had further created a distorted impression of his alleged links with President Putin and the Russian state. He expressed concern that the online article had referred to him as a “Russian tycoon”, despite the fact that he was born in New Zealand, as made clear in the article. He said that the article was prominently illustrated with photographs of him, labelled “PAYMASTER”, alongside images of Putin. The complainant said that this gave the clearly misleading impression that he was a person or part of an organisation that had a degree of financial control over the Russian President, and that the full caption, “PAYMASTER: [the complainant], head of the Legatum Group that ultimately funds the Institute”, distorted his role as a mere donor to the Legatum Institute Foundation.

16. The complainant said that the first article further misled the public because it did not inform the reader that his involvement in Gazprom had ended eight years ago. He said the claims made about him in the article were written in the present tense, namely that he and President Putin are “connected” and that they “have” links through Gazprom. He said that presenting the claims in that way was significantly misleading because he had no current connection with Gazprom and no links with Putin of any kind.

17. The complainant said that for the reasons set out above, there was no truth in the allegation that his “allies cut deals with President Vladimir Putin’s associates”, as reported in the second article.

18. The newspaper did not accept a breach of the Code. It said that the complainant’s involvement in the changing composition of the Gazprom board between 2000 and 2001 was a matter of public record. It provided extensive source material relating to the complainant’s role in Gazprom, and the appointments of Mr Fyodorov and Mr Miller.

19. The newspaper noted that the first article had made it clear that the complainant had never met President Putin. It said that all the allegations were put to the complainant, via the Legatum Institute, prior to publication. The newspaper provided this pre-publication correspondence. In it, the journalist requested a response to a number of questions relating to the complainant’s knowledge of the letter which was the subject of the article. The journalist also noted to the Institute that an MP had “called for the Intelligence Select Committee to investigate the source of the Chandler’s money and their influence over Legatum” and had “cited Christopher’s work with Putin's associates to install Alexey Miller, Putin's old deputy, as head of Gazprom after Putin's election as President in 2000.”

20. The newspaper provided the article published by the Institutional Investor, referred to by the complainant above. It noted that the article described how following his appointment in 2000, Mr Fyodorov subsequently colluded with the five Putin government appointees on the board of Gazprom to oust the existing CEO and install Alexey Miller in May 2001. It said that prior to his appointment Mr Miller was deputy Energy Minister and a confidant of President Putin. The newspaper said that by virtue of his vote the complainant had facilitated the appointment of Mr Fyodorov to the board of Gazprom. It said that this appointment, in turn, facilitated the subsequent boardroom coup which resulted in the ousting of the then CEO and the installing of President Putin’s ally, Mr Miller: this was set out accurately in the article.

21. During the course of IPSO’s investigation, the newspaper provided a prospectus which had been published by the complainant’s brother’s company, Clermont Group, in April 2018, which described how the Chandler brothers had made reforming changes at companies in which they had a stake, including Gazprom. The newspaper said that the document revealed how the complainant had installed Mr Fyodorov, and then appealed directly to President Putin regarding the changes he wanted to make at Gazprom. The prospectus stated:

“Responding to the Russian government’s expressed interest in liberalising Gazprom’s ownership structure, Sovereign also prepared a series of recommendations on how the ownership structure could be reformed… After producing several papers outlining Sovereign’s vision of reform for Gazprom, Sovereign eventually appealed directly to President Vladimir Putin. As a result, Alexey Miller, a young economist and close ally of the president, replaced Gazprom CEO Rem Vyakhirev in 2001.

22. The newspaper also provided an investment profile of Gazprom published by a company owned by the complainant, Orient Global, which was created in 2006 following the demerger of Sovereign Global. It said that this document set out how the complainant had been instrumental in forcing reforms in Gazprom’s governance: the complainant ensured that Mr Fyodorov was appointed to the board and, in turn, he was important in the boardroom coup that gave advantage to Mr Putin and his allies. The document stated:

“Sovereign, being the largest shareholder in Gazprom after the Russian government, assured the Presidential administration that they could rely upon the support of minority shareholders whose votes could be essential in providing the crucial swing seat on the Gazprom board.”

23. The newspaper said that the first article did not state that the complainant was involved directly in the subsequent coup which installed Mr Miller; it said that he helped President Putin’s associates take control and that he “helped trigger” the coup.

24. The newspaper noted the complainant’s position that he had no way of knowing or ensuring that the vote to install Mr Fyodorov would lead to the election of Putin’s ally Mr Miller as CEO. The newspaper said that even if that was so, that was the effect. It suggested that President Putin would have been grateful that the complainant assisted in installing Mr Fyodorov, who was an important figure in the boardroom coup which resulted in Mr Miller’s appointment as CEO. The newspaper provided previous coverage which reported that Mr Fyodorov’s vote, along with the five government controlled seats on the Gazprom 11-seat board, constituted the majority vote which put Mr Miller on the board.

25. The newspaper said that the first article was clear throughout that the connection with Gazprom was historic. It said that the article had made clear that the events took place in the early noughties and noted that the details of these events were written in the past tense. It said that although the complainant’s relationship with Gazprom terminated eight years ago, it did not follow that it was misleading to suggest that the complainant has any links with President Putin. The basis for this link was set out in the article, which also made clear that neither the complainant, nor anyone from Sovereign Global, had met President Putin.

26. The newspaper said that the reference to the complainant as a “Russian tycoon” appeared in the online version of the article only. It said that it was online for a matter of hours before the mistake was noticed and removed. While the newspaper acknowledged that the complainant was not a Russian citizen, the newspaper said that a reasonable reader would understand that the reference to “Russian” related to Mr Chandler’s extensive business interests in the country, rather than his nationality, particularly where the article made clear that the complainant was born in New Zealand. Notwithstanding this, the newspaper offered to publish a footnote clarification to the online article as a gesture of goodwill, as well as a standalone correction online for 24 hours. It suggested the following wording:

“An earlier version of this article labelled Mr Christopher Chandler as a “Russian tycoon”. We would like to make it clear that Mr Chandler is not a Russian citizen, but rather a New Zealander”.

27. The newspaper noted that the word “paymaster” appeared in a picture caption, which stated: “PAYMASTER: Christopher Chandler, head of the Legatum Group that ultimately funds the institute”. It said that this was an accurate description of the complainant’s position in relation to the Institute. It said that readers would be able to decide for themselves if the word “paymaster” was relevant. The newspaper further noted that the word “connected” had appeared in a picture caption which stated: “CONNECTED”: Mr Chandler has never met President Putin, but they have links through Gazprom”: the alleged link between the complainant and Putin was made clear.

28. The newspaper did not accept that the second article was inaccurate. It said that as set out above, the complainant and his brother had acknowledged being instrumental in installing the late Boris Fyodorov to the board of Gazprom in 2000. It said that Mr Fyodorov later collaborated with five appointees of the Putin government to oust the company’s existing CEO and replace him with Alexey Miller, an ally of President Putin.

29. The complainant said that neither he, nor the Legatum Group, is associated with the Clermont Group and therefore bore no responsibility for the contents of the literature it produced. The complainant said that this marketing pamphlet had been accept by Clermont to be an inaccurate account of the events in question, and noted that Clermont had corrected it. In relation to the Orient Global document, the complainant said that it set out a wholly inaccurate account of events, for the reasons set out above.

Relevant Code Provisions

30. Clause 1 (Accuracy) 

i) The Press must take care not to publish inaccurate, misleading or distorted information or images, including headlines not supported by the text.

ii) A significant inaccuracy, misleading statement or distortion must be corrected, promptly and with due prominence, and — where appropriate — an apology published. In cases involving IPSO, due prominence should be as required by the regulator.

iii) A fair opportunity to reply to significant inaccuracies should be given, when reasonably called for.

iv) The Press, while free to editorialise and campaign, must distinguish clearly between comment, conjecture and fact.

Findings of the Committee

31. The first article had claimed that the complainant had “helped President Vladimir Putin’s associates take control of Russia’s state energy giant Gazprom”; it credited him as “helping to trigger” a boardroom coup which “subsequently led” to Alexey Miller being installed as head of the company”. The newspaper had identified the complainant’s association with the changing composition of the board of Gazprom as a Russian link in the context of a wider investigation by the newspaper into the extent of Russian influence in the affairs of current UK politics. This was a significant claim which required justification. The Committee carefully scrutinised the care taken over the presentation of this alleged “link”, which had been used by the newspaper as the core justification for its investigation into the complainant.

32. It was not in dispute that Mr Fyodorov’s platform in standing for election to the Board of Directors was the reform of Gazprom, which, in this context meant voting with the government appointees on the Board of Directors, against the company’s executive leadership, namely its then-Chief Executive. It was also accepted that the complainant’s company, a significant shareholder in Gazprom, had supported Mr Fyodorov’s candidacy specifically on the basis that he was seeking to reform Gazprom, and that Mr Fyodorov had accordingly gone on to vote with the government appointees, including to install Alexey Miller as CEO. Further, it was accepted that Mr Miller was a close associate of Vladimir Putin. The complainant’s company had actively supported Mr Fyodorov’s candidacy on the basis that he would vote against the company’s executive leadership. Mr Fyodorov had joined government appointees to vote for Mr Miller. In those circumstances, the Committee did not establish that it was a failure to take care over the accuracy of the article to report that the complainant had “helped President Vladimir Putin’s associates take control”.

33. The complainant said that the article implied, misleadingly, that he had acted in order to install Mr Miller; in fact he could not have known that his vote in 2000 would lead to the installation of Mr Miller ten months later. However, the newspaper had not claimed that the complainant had acted to install Mr Miller. It had explained that the complainant and his brother had “built a substantial holding Gazprom” but around 2000 had become “angered by the corruption they had witnessed”, and were “credited with helping to trigger a boardroom coup”, a reference to the election of Mr Fyodorov with the complainant and his brother’s support. It noted the complainant and his brother’s position that they “helped to bring ‘transparency and accountability’ to the company”, and recorded accurately that Mr Miller had “subsequently” been made Chief Executive by the newly constituted Board of Directors. This was an accurate account of the chain of events that had led to Mr Miller’s appointment and did not suggest that the complainant had acted directly to install Mr Miller or had known that his support for Mr Fyodorov would result in Mr Miller’s appointment. There was no breach of Clause 1(i), nor was the article misleading or inaccurate such that a correction was required on these points under the terms of Clause 1(ii).

34. A photograph of President Putin was accompanied with the caption: “CONNECTED: Mr Chandler has never met President Putin – but they have links through Gazprom”. The Committee noted the complainant’s position that the caption’s use of the present tense had failed to make clear that his involvement with Gazprom had come to an end eight years ago.

35. However, the article had been clear throughout that the events which were the subject of the newspaper’s investigation into the complainant had occurred in the early 2000s. The newspaper had complied with its obligations to take care over the article’s accuracy on this point. The fact that the events being described related to the early 2000s did not mean, however, that there was no “link”. The complainant’s involvement in Russia over a period of years and his highly profitable investment in Gazprom remained an important part of his public profile and a key feature in his career. The Committee did not establish that the complainant’s relationship with Gazprom and any alleged association with Putin, was presented in a misleading way. This aspect of the complaint did not breach Clause 1.

36. The article, in print and online, had made clear that the complainant had been born in New Zealand, and resided in Dubai. In this context, and where the complainant’s link to Russia was the subject of the article, the Committee did not find that the single reference to him as a “Russian tycoon” represented a failure to take care over the accuracy of the article in breach of Clause 1 (i). Nor was it a significant inaccuracy requiring correction under the terms of 1(ii). Nonetheless, the Committee welcomed the offer of an amendment and footnote on this point. 

37. A photograph of the complainant had been accompanied with the caption: “PAYMASTER: Christopher Chandler, head of the Legatum Group that ultimately funds the institute”. The complainant objected to the use of the term “paymaster”, as he said it suggested that he had funded Putin or was the “paymaster” of the Legatum Institute, and mis-described his role, which was limited to being one of the institute’s funders.  The Committee did not accept that the photo caption implied that the complainant had “funded” Putin; it referred directly to his role in funding the institute. It considered the remainder of the complaint about the caption in the context of the article’s explanation of the complainant’s financial links with the institute. The article had detailed the complainant’s role in the funding of the institute, explaining that he it had been “set up using some of the [complainant’s] fortune”, and that the institute received £3.9million of its total of £4.4million funding from the Legatum Foundation, the “development wing” of the Legatum The complainant did not appear to dispute these points. The article had included a statement by a spokesman for the Institute that the complainant was “not involved in running the Legatum Institute” or had “no role” in the appointment of its current economics director, and noted that the Legatum Group states that the Institute “is a completely independent charity with its own trustees”. It had also quoted the Institute’s denial that the complainant had “any role” in relation to the letter that was the main subject of the article. The article had accurately reported the complainant’s role as a major funder of the Institute and recorded the positions of both the Legatum Group and the Institute that the two groups operated independently. In this context, the Committee not considered that the reference to the complainant as a “paymaster” who “ultimately funds” the institute was misleading. There was no breach of Clause 1 on this point.

38. The second article had reported that complainant’s “allies cut deals with President Vladimir Putin’s associates”. For the reasons set out above in paragraph 33, this did not represent a failure to take care, or a significant inaccuracy. The complainant had accepted being instrumental in installing Fyodorov to the board of Gazprom in 2000; Fyodorov had later collaborated with five appointees of the Putin government to oust the company’s existing CEO and replace him with Alexey Miller, an ally of President Putin. There was no breach of the Code.

Conclusion

39. The complaint was not upheld.

Remedial Action

40. N/A

Date complaint received: 06/03/2018
Date decision issued: 21/08/2018