As pro-kremlin propaganda assures the average russian and the few supporters of the regime abroad, putin has managed to consolidate the entire russian elite and the entire political establishment around him. Of course, for 20 years, power in russia has been held by oligarchic clans headed by a dictator.
Although putin considers himself the moderator of all processes taking place in russian political circles, in fact, the kremlin has many competing centers of influence from among oligarchic groups. Until a certain time, the oligarchic clans were satisfied by the consensus figure of putin. After all, according to an unspoken agreement, in exchange for public support of putin’s regime, the oligarchs were allowed to privatize the most profitable state-owned enterprises for nothing and withdraw funds abroad. Before the war, russian billionaires from the list of the world’s richest people had at least 339 billion dollars in their accounts and about 80 billion dollars of “shadow” income offshore, which corresponds to the total wealth of 113 million (77%) ordinary russians.
putin was also loyal to the dual citizenship of most oligarchs and their massive purchase of real estate in Europe and the United States. Among the 100 richest russian billionaires, 40 have foreign citizenship, 57 live mainly abroad, and 68 have taken family members abroad. Among the rich of the russian federation with a fortune of more than 50 million dollars, 58% had foreign citizenship.
But everything changed after February 24, 2022.
In response to the open aggression in the USA and the EU, the search for hidden assets of russian oligarchs and officials was launched against the background of increased financial sanctions for those who facilitate the evasion of sanctions. According to Bloomberg, 23 russian billionaires, who were among the 500 richest people in the world, lost $67 billion, or 20% of their combined fortune, in a year of full-scale war.
O. Mordashov, the main owner of Severstal PJSC, one of russia’s largest steel producers, lost the most. Since the full-scale invasion, his fortune has declined by $6.7 billion. In second place is the chairman of the board of PJSC Novolypetsk Metallurgical Plant V. Lisin, who lost 5.8 billion dollars for the year.
Also, the US authorities searched for real estate and luxury items of russian tycoons who were subject to personal sanctions. For oligarch V. Vekselberg, this led to the seizure of 2 yachts worth $300 million each, and 6 properties in New York and Florida worth $75 million.
R. Abramovich was forced to sell his real estate in London, together with the famous Chelsea football club.
During the year of the war, the sanctions pressure only increased, and on the anniversary of the full-scale invasion, the USA, in coordination with the G7, announced the introduction of new sanctions against the metallurgical and mining sectors of the russian economy, as well as against 22 individuals, 83 organizations and 11 banks.
And it is not surprising that putin-oligarchic “peaceful coexistence” began to “crack at the seams.” In order to preserve assets and business abroad, some billionaires renounce their russian citizenship and flee russia – Yu. Milner ($7.3 billion), the son of the top manager of Gazprom N. Storonsky ($7.1 billion), ex-banker O. Tinkov ($0 .6 billion). Others demand not to associate their names with russia – Telegram owner P. Durov ($15.1 billion), computer game developers the Bushman brothers ($8.1 billion each). For the opportunity to settle in Europe, primarily Great Britain and Switzerland, russian oligarchs are ready to directly betray putin and openly support Ukraine. So, M. Friedman ($13.2 billion) promised the National Bank of Ukraine $1 billion, and his son declared himself a Ukrainian. R. Abramovich actively lobbies for the end of the war on Ukraine’s terms and promised to transfer 2.5 billion pounds from the sale of “Chelsea” to the fund to help victims of the war in Ukraine.
The split between the authorities and the oligarchs was exacerbated by the russian government’s desire to “tighten the screws” on large companies to compensate for the record deficit of the previous fiscal year, and only worsened in 2023. In an attempt to correct the situation, putin gathered the largest russian oligarchs for a meeting in March for the first time since the beginning of the war. There he taught them how to do business correctly and demanded that they keep their assets in the russian federation. It is doubtful that he managed to convince the present billionaires Deripaska, Potanin, Mordashov, and Vekselberg, who have been experiencing the effectiveness of Western sanctions since last February.
❗️The case of sanctions punishment of russian oligarchs led to the rapid destruction of the vertical of kremlin power and the emergence of serious prerequisites for an internal civil conflict, which threatens the existence of the russian federation within its current borders. For Ukraine, there are real prospects of confiscating russian assets under sanctions and directing them to the post-war reconstruction of Ukrainian territory.
