Russia has allowed the suspected killers of a whistleblowing lawyer to escape with impunity and instituted a high-level “cover up” of corruption which the international community must do more to counter, according to a damning report.

A six-month investigation into the death of Sergei Magnitsky by the Council of Europe found that the Moscow authorities had mounted “belated, sluggish and contradictory” investigations into the death of the tax specialist who uncovered a $230m (£149m) fraud against the Russian state.

Mr Magnitsky, who was working for British hedgefund Hermitage Capital Management when he uncovered the fraud in 2008, was arrested by the same tax investigators he had accused and held for a year in Russian prisons before dying from a serious untreated health condition following a beating on the eve of his death.

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The 41-page report by a Swiss MP stops short of naming Mr Magnitsky’s alleged killers but in a move which will further heighten diplomatic tensions over the case, it describes that case as “emblematic” of corruption and human rights abuses in Russia and calls on the international community to consider further measures to pressure Moscow into acting on the case.

The United States has already imposed visa restrictions and frozen assets of 60 Russian officials linked to the death of Mr Magnitsky, provoking a retaliatory ban from Moscow on American citizens adopting Russian children.

Andreas Gross, the author of the report, who is also head of the socialist group of the Council of Europe’s parliamentary assembly, said: “In the interest of the Russian people themselves and their state, corrupt officials must not be allowed to plunder state property whilst brutally silencing those standing in their way, with impunity.”

The report documents how Mr Magnitsky was shuttled between different Russian prisons following his arrest in November 2008, becoming increasingly ill from pancreatitis which did not receive proper treatment. He died following his admission to Moscow’s Matrosskaya Tishina prison, where he was beaten with rubber truncheons and left untreated the day before he was found dead.

Mr Gross said: “There is no doubt that some of the causes of Mr Magnitsky’s death were created deliberately, by identifiable persons, others by negligence.”

He added: “Sergei Magnitsky had denounced a gigantic robbery whose victim was Russia herself. He died because he refused to give in to the pressure that mid-level officials had put on him in order to get away with their crimes. Why, then, does the Russian state, and at such a high level, try so hard to cover up this crime?

“Why do the competent authorities not simply investigate and expose the criminal conspiracy, put the perpetrators behind bars and follow the ‘money trail’ to get the stolen taxes back?”

The Council of Europe, which oversees the European Court of Human Rights, will now vote on a motion in September to adopt the report and condemn the failure of the Russian authorities to bring anyone to justice for Mr Magnitsky’s death.

Mr Gross said he had requested meetings with officials alleged to have been involved in the fraud, which allegedly involved the misappropriation of companies and the subsequent siphoning away of tax rebates, but no access had been forthcoming.