Russian Oligarchy: Where Do Russian Billionaires Keep Their Wealth? For decades, Russian oligarchs have channeled billions of dollars in illicit money abroad, hiding it behind shell firms to make it impossible to track.
Today, many countries throughout the world are beginning to take steps to locate that money.
How much Russian "black money" is there in the world?
Who are the top rich Russians allied with Putin?
According to a 2020 assessment from the Center, a fourth of this money is controlled by Russian President Vladimir Putin and his inner circle, the wealthy Russians known as "oligarchs."
"This money can be exploited and directed by the Kremlin for espionage, terrorism, industrial espionage, bribery, political manipulation, disinformation, and many other criminal reasons," according to the report.
How do you make "black money"?
- According to the National Endowment for Democracy, Putin pushed individuals close to him to "steal from the public budget, extort money from private corporations, and even coordinate outright takeovers of profitable businesses."
- She further claims that they have amassed personal fortunes worth tens of billions of dollars in this manner.
- Boris Nemtsov and Vladimir Milov, two prominent Russian dissidents, have claimed that between 2004 and 2007, $60 billion in funds were moved to Putin's pals from the oil firm Gazprom.
What are the most notable disclosures that shook the financial sector, according to Pandora's latest?
The secret fortunes of world leaders have been revealed as a result of a leak.
And, according to Bandura's documents, which were made public by the International Consortium of Investigative Journalists, persons close to Putin have gotten extremely wealthy — and can assist him to dispose of his own fortune with tremendous freedom.
Where is that money kept?
Historically, Cyprus has been the most notable destination for much of this money, as it has a tax system that appears beneficial and appealing to the owners of these assets, to the extent that this island has become known to some as the "Moscow of the Mediterranean."
According to the US Atlantic Council, Russia sent $36 billion to Cyprus alone in 2013. Many of them came through shell firms, which are designed to hide the genuine owners' identities.
The International Monetary Fund convinced Cyprus to shut tens of thousands of bank accounts maintained by shell firms in 2013.
- Popular destinations include British Overseas Territories like the British Virgin Islands and the Cayman Islands.
- According to a Global Witness investigation, Russian oligarchs had an estimated $45.5 billion in tax havens in 2018.
- Some of this money also makes its way to major financial centers like New York and London, where it can be invested and profited.
Who are the Russian oligarchs or "Putin's friends"?
Transparency International alleges that at least $2 billion (£1.5 billion) in British property belongs to Russians accused of financial crimes or with ties to the Kremlin.
The scope of Russian money laundering was disclosed in a 2014 report by the Russian Money Laundering Organized Crime and Corruption Reporting Project. According to the report, 19 Russian banks laundered $20.8 billion through 5,140 businesses in 96 countries between 2011 and 2014.
How is that money hidden?
- Shell corporations are sometimes used by Russian billionaires to conceal their "black money" abroad.
- "These oligarchs use the world's greatest lawyers, auditors, bankers, and lobbyists to create legal techniques to hide and launder their money," according to the Atlantic Council think tank.
- "The true aristocracy has enormous groups of anonymous shell corporations in a number of offshore jurisdictions, and their money moves at lightning speed between those firms."
- The International Consortium of Investigative Journalists published the Panama Papers in 2016, revealing that one business alone had established 2,071 shell corporations for wealthy Russians.
What actions must be taken to gain access to the oligarch's money?
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| Cyprus is such a popular destination for Russian money that it is called 'Mediterranean Moscow'. |
Following the invasion of Ukraine, governments adopted a slew of measures aimed at tracing Russian funds.
- The United States, for example, is organizing a new working group called "Kleptocapture" to limit the financial resources of Russian billionaires.
- The US Department of Justice will lead the squad, which will be tasked with seizing assets acquired through criminal means.
- The UK government has taken steps to boost the use of "unexplained wealth orders," which force persons to prove the origins of cash used to purchase assets in the UK.
- Furthermore, bank account freezing orders (AFOs) empower courts to freeze funds in banks and other financial institutions if they suspect the funds are linked to criminal conduct.
- The Economic Crimes Act was authorized by the British government in relation to property records of offshore firms.
The "Golden Visa Scheme," which awarded affluent foreigners residency rights provided they invested substantial sums of money in the country, has also been terminated in the United Kingdom.
Malta, one of the most popular tax havens for Russian money, abolished the "golden passport" scheme, which allowed oligarchs to buy citizenship, and Cyprus and Bulgaria followed suit in 2020.