Russia’s billionaires: Who they are, what they own — and can they influence Vladimir Putin?

360 description topper for all 360s

Overview Oligarchs 360

By Tom Nagorski - Global Editor

The word is everywhere lately, in connection with the war in Ukraine and the increasingly long list of individuals being punished for their alleged ties to the Kremlin. But what exactly is an “oligarch” — a Russian one, anyway?

Technically, the term is Greek — oligarkhia — for “rule by a few.” It acquired the connotation of wealthy influencers only in the wild, no-holds-barred capitalism that followed the Soviet Union’s collapse. Say “oligarch” now and most will think: Russian, ultrarich, yachts and mansions.

Hear more from Tom Nagorski, Joshua Keating and Nikhil Kumar about this story:

Russia’s oligarchs rose from the ashes of the Soviet Union in 1991, and the end of state ownership of property and commodities. The economic program that followed was known as privatizatzya — Russian for what it sounds like: privatization, the process of redistributing ownership of all those assets that had been held by the Soviet state for more than seven decades. Privatizatzya saw a small group of entrepreneurs (itself a new class at the time) snap up state enterprises at fire-sale prices — the Soviet-era prices — which were vastly less than the true market value.

Not everyone who played the game succeeded. But given Russia’s vast supplies of oil, gas, gold, diamonds, timber and other natural resources, those who did cashed in on a grand scale. Before long, there were billionaires (in dollars, not rubles) in a society where civil servants earned a few thousand dollars a year. These newly rich would be the Russian oligarchs — faithful to the definition, in that the country really was being “ruled by a few.” It just happened to be a “few” who had rapidly become very, very rich — and politically powerful as well.

They are under a microscope now because of the war in Ukraine and their perceived connections to (and in some cases perceived influence on) Russian President Vladimir Putin, and because they are obvious targets as a raft of sanctions and other penalties are imposed against nearly all things Russian. If Russian companies, financial institutions and government officials are to be hit by the punitive measures, the thinking goes, surely these billionaire moguls should be as well.

Thesis Oligarchs 360

Thesis

The pursuit of the oligarchs raises fundamental questions — about the roots and nature of their wealth, the sanctions imposed against them, and their ability to influence Putin and the course of the war. Despite their enormous wealth and influence in Russian society and abroad, most of these oligarchs remain subject to the whims of Putin and the security state. Their influence and lavish lifestyles abroad are likely to diminish in the wake of the sanctions worldwide, but key questions are whether some of these billionaires may still have influence in the Kremlin — and whether they will choose to use it.

Money Lens

The Target List

By Jason Paladino - Investigative Reporter, Anna Deen - Data Visualization Reporter, Alex Leeds Matthews - Data Visualization Reporter

More than two dozen wealthy Russians now face sanctions imposed by Ukraine, the United States, Canada, the United Kingdom, Australia, Japan, Switzerland, New Zealand and the European Union. Among those sanctioned are some well-known names — perhaps most notably Roman Abramovich, owner of the Chelsea FC British soccer team.

Most are known more for their wealth and their seats atop Russia’s most powerful companies and institutions. A half dozen examples:

Many of the oligarchs hold multiple passports and homes in different countries. Some do not work at all. All are phenomenally wealthy.

Grid reviewed public reports of net wealth for 13 of the sanctioned oligarchs from Forbes, Bloomberg and other sources, and found that their reported wealth — their own and their relatives’ — amounted to some $260 billion, though the actual number is likely much higher.

There were no reliable estimates of net worth for the remaining 11 Russians.

The sanctions

In announcing U.S. sanctions against several individuals on March 3, the White House justified moving against a group of wealthy Russians because they “continue supporting President Putin despite his brutal invasion of Ukraine.”

Beyond a handful of seizures and frozen assets, the immediate effect of these sanctions is unclear.

Oligarch Usmanov has lost control of his superyacht, the world’s largest by tonnage; German authorities have prohibited the vessel from leaving the port in Hamburg. It’s one of four “superyachts” belonging to Russians that have been seized since the war began. French authorities seized a vessel they said was owned by Rosneft CEO Sechin, and the Italians seized two others, reportedly owned by Mordashov and Timchenko, two men considered to be in Putin’s inner circle.

Operation “KleptoCapture”

Loopholes?

Sanctions against individuals aren’t bulletproof. Banks don’t closely vet every transaction they handle, and if a sanctioned name is not obviously linked to an account or transaction, banks may not act. Anonymous shell companies, numbered cryptocurrency accounts and straw-man arrangements (i.e., having someone else make transactions on behalf of a sanctioned individual) are possible tools to evade the strictures.

Two superyachts owned by Russian oligarchs appeared Tuesday to be anchored in the port of Dubai: the Madame Gu, owned by the sanctioned steel magnate Andrey Skoch, and the Nirvana, owned by Vladimir Potanin, one of Russia’s wealthiest billionaires.

Power Lens

Spreading the wealth — and influence

By Nikhil Kumar - Deputy Global Editor

They may be kleptocrats. They may have become rich on ill-gotten gains and/or questionable dealings involving the Kremlin. But many Russian oligarchs have not only been welcomed in Western Europe — they have become well-respected figures in business, politics and the media as well.

A place called “Londongrad”

Nearly two decades later, governments around the world are challenging that assertion — slapping sanctions on Abramovich and the others, in part because of their alleged ties to the Kremlin.

Whatever their history in Russia, many of these billionaires have had no trouble parlaying their fortunes into all-access passes to the most exclusive circles in the West, from the media to sports to politics.

Money = Influence

“It’s very hard to get a grasp on the exact amount,” Thomas Mayne, who co-authored the Chatham House report, told Grid. But what is clear is that the money has been used to build influence.

“That’s part of their plan. They donate to charities, donate to political figures, donate to universities, in order to increase their profile,” Mayne explained. “Some of that is, you know, they just want to be the big man. But some of that is actively generating a reputation.”

Abramovich and others have succeeded despite long-running concerns about the sources of their wealth — and its connections to the corridors of power in Moscow.

“We’ve known for a long time that the guy in the Kremlin is a pretty bad guy,” Mayne said. “And we’ve known for decades that there are these men around him who have supported him and have made billions from close links to the Kremlin, and in some cases are used actively to further the Kremlin’s malign purposes. But we’ve been quite happy to take that money for 20 years.”

Not just Britain

Russia’s oligarchs have made major inroads in other parts of Europe.

Another prominent politician under pressure for links to the oligarchs is Gerhard Schroeder, who was Germany’s chancellor from 1998 to 2005. Schroeder sits on the board of the Russian oil giant Rosneft, led by Sechin, who has been sanctioned by the U.K., U.S. and others. Schroeder also holds a senior post at the company charged with building the recently scuttled Nord Stream 2 pipeline. Central to that project: Russian gas giant Gazprom, run by Alexei Miller, sanctioned by the U.S. several years ago. He was added to the U.K. sanctions after the Ukraine invasion.

Further fallout is likely as governments wade deeper into the Russia-connected cash coursing through Western capitals.

One question, as these and other efforts unfold, is whether the crackdowns will last. “It remains to be seen whether this will create a long-lasting institutional change about how we react to this kind of money, and especially kleptocratic funds in general, not just Russian funds,” Mayne told Grid. “Funds from China, Kazakhstan, Dubai and so on. We really need to use this as a force for good if we can, and change the way we view this money.”

The other question: Will the crackdown influence the Kremlin?

Inside the Kremlin Lens

Can they influence Putin?

By Joshua Keating - Global Security Reporter

The taming of the oligarchs

To begin to understand the extent of the oligarchs’ influence in Russia, it helps to understand this basic fact: While these wealthy Russians have had to do what they can to stay in the Kremlin’s favor, they have generally exerted little to no influence over the government’s policies and decisions.

“They’re servants, basically,” Daniel Treisman, a political scientist at the University of California at Los Angeles, told Grid. “They coordinate all their major deals with the Kremlin and make sure the Kremlin is OK with them. They’re allowed to use their own connections in the security services and in law enforcement to harass rivals and to expropriate rivals at times. But when the Kremlin comes knocking, they have to answer the door.”

The inner circle

The wealth of the silovarchs is often held by their extended family members or otherwise concealed. “You can’t just look at the Forbes list and say, ‘Oh, there they are,’” Stanislav Markus, a professor of business at the University of South Carolina who studies Russian capitalism, told Grid.

“If you think about the Russian elites, I would describe them as two partly overlapping circles: One circle is labeled guns, and the other one is labeled money,” Markus said. “In terms of who would be able to influence Putin, it’s definitely either just the guns or guns and money. The civilians, the ones with just money, they’re not that important right now.”

Conclusion Oligarchs 360

The oligarchs make an appealing target for politicians and law enforcement agents alike. Supporting the Ukrainian resistance by impounding a Russian billionaire’s mansion or yacht is — on its face, at least — an uncontroversial, even criticism-proof approach. It feels good, after all, to go after kleptocrats.

Still, there are no guarantees these measures will have much impact beyond the difficulties that Abramovich, Mordashov and the others may face.

There are the above-mentioned loopholes, for one thing. For another, while the U.S. has levied sanctions against dozens of oligarchs over the past decade, many have remained in business, and none of the earlier sanctions dissuaded Putin from escalating tensions with and ultimately invading Ukraine.

As for the question of whether an oligarch might reach out and sway the president’s mind, the only hope would be one of the small group who has kept ties to the Russian leader, and given who they are, that seems unlikely.

”My sense is that it’s these people who have a personal bond with Putin that Putin might still listen to,” said Treisman. “It’s not people who have a formal role like, say, the prime minister, or people who just have a lot of money. I don’t think there’s any reason to listen to them.”