WASHINGTON— The term Russian oligarch conjures images of posh London mansions, gold-plated Bentleys and sleek superyachts in the Mediterranean, their decks draped with partiers dripping in jewels.
But the raft of sanctions on oligarchs announced by President Joe Biden this week in response to the invasion of Ukraine may do little to dim the jet-setting lifestyles of Russia’s ultra-rich and infamous – much less force a withdrawal of tanks and troops.
U.S. sanctions target Russian President Vladmir Putin and a handful of individuals believed to be among his closest security advisers, including Foreign Minister Sergey Lavrov. But the list is just as notable for who isn’t on it — most of the top names from Forbes’ list of the richest Russians whose multi-billion-dollar fortunes are now largely intertwined with the West, from investments in Silicon Valley start-ups to British Premier League soccer teams.
Biden said Thursday the new U.S. sanctions would nonetheless cripple Russia’s financial system and stymie its economic growth by targeting Russia’s biggest banks, which the Treasury Department said holds nearly 80% of all the country’s banking assets.
“Putin is the aggressor. Putin chose this war. And now he and his country will bear the consequences,” Biden said, laying out measures that will “impose severe cost on the Russian economy, both immediately and over time.”
But much of the wealth of Russia’s richest isn’t held in the sanctioned Russian banks. Putin and the oligarchs aligned with him have had decades to stash assets overseas, much of it hidden in ways specifically designed to avoid sanctions.
Though the Kremlin officially reports Putin’s income at $131,900 annually, the Russian president is believed to benefit from many billions in cash and overseas assets held by trusted friends and relatives, many of whom are from his home city of St. Petersburg.
A 2017 study of Russian oligarchs published by the U.S.-based National Economic Bureau estimated that as much as $800 billion is held by wealthy Russians in the United Kingdom, Switzerland, Cyprus, and similar offshore banking centers. That vast fortune, held by a few hundred ultra-rich individuals, is roughly equal to the wealth of the entire rest of the Russian population of 144 million people.
Some oligarchs have also obtained dual citizenship in Britain and other Western countries, adding legal complications to attempts to unilaterally seize their assets.
