Russian oligarchs
Russian oligarchs (Russian: олигархи, tr. oligarkhi) are business oligarchs of the former Soviet republics who rapidly accumulated wealth in the 1990s via the Russian privatisation that followed the dissolution of the Soviet Union. The failing Soviet state left the ownership of state assets contested, which allowed for informal deals with former USSR officials (mostly in Russia and Ukraine) as a means to acquire state property.
The Russian oligarchs emerged as business entrepreneurs under Mikhail Gorbachev (General Secretary, 1985–1991) during his period of market liberalization.[1] Boris Berezovsky, a mathematician and formerly a researcher, became the first well-known Russian business oligarch.
Oligarchs became increasingly influential in Russian politics during Boris Yeltsin's presidency (1991–1999); they helped finance his re-election in 1996. Well-connected oligarchs like Roman Abramovich, Michail Khodorkovsky, Boris Berezovsky and Vladimir Potanin acquired key assets at a fraction of the value at the loans for shares scheme auctions conducted in the run-up to the election.[2] Defenders of the out-of-favor oligarchs argue that the companies they acquired were not highly valued at the time because they still ran on Soviet principles, with non-existent stock control, huge payrolls, no financial reporting and scant regard for profit.[3]
Since 2014, hundreds of Russian oligarchs and their companies have been hit by the US sanctions for their support of "the Russian government's malign activity around the globe".[4][5] In 2022, many Russian oligarchs and their close family members were targeted and sanctioned by countries around the world as a rebuke of Russia's war in Ukraine.
After the 2022 Russian invasion of Ukraine, Canada, US, and European leaders with the addition of Japan, took unprecedented steps to sanction Putin and the oligarchs directly.[49] In response to the sanctions, the targeted oligarchs started to hide wealth in an attempt to prevent the Western nations from freezing their assets.[50] These sanctions intend to directly impact the Russian ruling class as a response for their perceived contribution and acquiescence to the war with Ukraine. Although the sanctions miss some of the richest oligarchs, the impact on the war is unknown due to Putin's power over those that were sanctioned.[51] Since the invasion began, nine of the Russian oligarchs' yachts have turned their navigation transponders off as they sail to ports where they are less likely to be searched and seized.[49]
On March 2, 2022, the United States announced a special task force dubbed "Task Force KleptoCapture". This team was put together to specifically target oligarchs. It is made up of officials from the FBI, Marshals Service, IRS, Postal Inspection Service, Homeland Security Investigations and Secret Service. The main goal of the task force is to impose the sanctions set against these individuals to freeze and seize the assets that the US government claimed were proceeds of their illegal involvement with the Russian government and the invasion of Ukraine.[52] On March 21, 2022, the Organized Crime and Corruption Reporting Project launched Russian Asset Tracker to showcase the profiles and assets of several Russian oligarchs.[53]
Several dozen business people with family connections to top politicians include President Putin’s younger daughter Katerina Tikhonova, who through her investment fund has been the recipient of numerous large contracts from state-owned energy companies.[54] Her former husband Kirill Shamalov runs the largest Russian petrochemicals company Sibur as well as his own investment fund.[55]
The son-in-law of Foreign Minister Sergei Lavrov runs an investment fund with assets exceeding $6 billion. Andrey Ryumin,[56] the son-in-law of Viktor Medvedchuk, President Putin’s former closest ally in Ukraine, runs another investment fund with large agricultural holdings which have become recipients of state subsidies for import substitution (Rouhandeh 2022). Petr Fradkov, the son of a former Prime Minister and head of the Russian foreign intelligence service, Sergei Sergeevich Ivanov, the son of the former head of the presidential administration Sergei Ivanov, and Andrey Patrushev, the son of the current head of the Russian Security Council Nikolai Patrushev have all joined the ranks of the oligarchs.[57]
The list of oligarchs and business executives who have risen to prominence and who have been sanctioned after Russia's invasion of Ukraine includes: