If Russia’s oligarchs weren’t worried before, they probably are now.
In his first State of the Union address on Tuesday night, President Joe Biden addressed Russian President Vladimir Putin’s cronies directly, telling them that the United States and its allies are coming to ” seize their yachts, their luxury apartments, their private jets.”
The message highlighted how much the terrain is changing under the affluent feet of Russia’s oligarchs, a class of businessmen who amassed billions in personal wealth by leveraging their Kremlin connections in the division of the former Soviet Union’s assets in the 1990s.
Since Putin’s invasion of Ukraine, Western governments have tried to freeze the oligarchs’ overseas assets along with Putin’s, as well as prevent them from traveling.
The goal is twofold: the sanctions act as a punishment for Russia’s ruling class and a club to try to force Putin to back down.
It is safe to say that the sanctions, at least so far, have successfully caught the attention of the oligarchs.
Roman Abramovich, a 55-year-old man with an estimated net worth of $13.5 billion, announced on Wednesday that he is selling off his beloved Chelsea Football Club, which he acquired in 2003.
While Abramovich has yet to be named on the sanctions lists, UK lawmakers are pushing leaders to do so.
The tycoon is reportedly unloading some of his properties in London in anticipation of sanctions.
“He is afraid of being sanctioned, which is why he is already going to sell his house tomorrow and sell another apartment as well,” British lawmaker Chris Bryant said, according to Bloomberg.
The oligarchs are on the move, and we know this in part from a 19-year-old from Florida who built Twitter bots that track the movements of some 40 planes and helicopters linked to Russian oligarchs. This is the same 19-year-old who made headlines earlier this year for turning down Elon Musk’s request to take down a bot dedicated to the Tesla CEO’s jet.
Earlier this week, at least four superyachts owned by Russian billionaires with ties to Putin were seen moving towards Montenegro and the Maldives, CNBC reported.
The Maldives, an island nation in the Indian Ocean, does not have an extradition treaty with the United States, which could increase its appeal as an oligarchic refuge.
Unfortunately for the Russian elite, other hitherto safe ports are increasingly closing them down. Monaco, the tiny French Riviera principality that has become a playground for Russia’s rich, adopted sanctions identical to those of the EU on Tuesday.
And famously neutral Switzerland also allied with the EU this week, announcing it would close its airspace to flights from Russia and impose entry bans on several of Putin’s cronies.
Of course, experts say imposing sanctions on tycoons won’t be quick or simple. Seasoned billionaires who built their wealth under authoritarian rule are adept at obscuring their assets through layers of shell companies and cronies.
“If you are a Russian oligarch floating around on his yacht in the Indian Ocean, most of your money will no longer be in your own name,” said Alison Jimenez, president of litigation consultancy Dynamic Securities Analytics. “You’re going to have the opaque layer of shell corporations with fictional people replacing you.”
That might take some of the punitive bite out of Western sanctions. “You can seize the boat, you can seize the plane, but they have money hidden all over the world,” says Jimenez. “If you can capture 75% of that, they will still be richer than everyone else in the world.”
But the pressure appears to have an immediate psychological and monetary impact.
Fridman, who was born in western Ukraine and is closely linked to Putin’s inner circle, wrote in a letter to his staff that he wanted the “bloodshed to end”.
Fridman is the president of Grupo Alfa, a private conglomerate that encompasses banking, insurance, retail and mineral water production.
His plea for peace was echoed by Deripaska, who made his fortune in the aluminum business. “Peace is very important! Negotiations need to start as soon as possible,” he said on Sunday in a Telegram post.
— Charles Riley of CNN Business contributed to this article.
Source: CNN Brasil
I am Sophia william, author of World Stock Market. I have a degree in journalism from the University of Missouri and I have worked as a reporter for several news websites. I have a passion for writing and informing people about the latest news and events happening in the world. I strive to be accurate and unbiased in my reporting, and I hope to provide readers with valuable information that they can use to make informed decisions.
