How the global financial system enables oligarchy
At On Point, we love numbers. So, here are some numbers around money, and how the global financial system enables oligarchy.
50%. That’s the percentage of Russian oligarchs’ wealth that is held outside of Russia.
£100 billion ($131 billion). That’s how much money is invested by Russian oligarchs into the United Kingdom per year.
About £1.5 billion ($1.9 billion). That’s the amount of British real estate that has been bought with suspect funds from Russia.
$2.3 billion. That’s how much Russian money has been invested into real estate in the last five years in the U.S.
Many of the world’s richest countries slapped sanctions on individual Russian oligarchs. The goal? To rattle Vladimir Putin by squeezing his closest supporters.
From the U.S. —
“We’re joining with European Allies to find and seize their yachts, their luxury apartments, their private jets. We’re coming for your ill-begotten gains,” President Joe Biden said.
To the U.K. —
“We will sanction Russian individuals and companies of strategic importance to the Russian state,” Prime Minister Boris Johnson said.
Meanwhile Japan, France and Germany have also taken steps to freeze assets tied to Russian oligarchs.
So how were these Russian oligarchs able to launder so much wealth in the first place?
One big avenue is through the global financial market. A very legal and highly regulated system. Well, so we thought.
According to a 2018 report by the Common Foreign Affairs Committee, the U.K. has simply quote “turned a blind eye” to Russian “dirty money” laundered through London.
Billions and billions of likely “dirty money” has flooded out of Russia for decades, with little done to stop it.
Today, On Point: Protecting Ukraine and democracy, by reforming the global financial system.
Louise Shelley, professor of public policy and director of the Terrorism, Transnational Crime and Corruption Center at George Mason University. Author of many books, including Dark Commerce and Dirty Entanglements. (@ShelleyTraCCC)
Oliver Bullough, he writes and reports about financial crime, kleptocracy and offshore money laundering for various outlets including the Guardian and the BBC. Author of Moneyland and the forthcoming Butler to the World. (@OliverBullough)
Daniel Glaser, former assistant secretary for terrorist financing at the U.S. Treasury Department from 2011 to 2017.
The Guardian: “The oligarch’s guide to getting round the UK’s economic crime bill” — “he economic crime bill being debated today in the House of Lords does not, as the home secretary, Priti Patel, insisted, show Britain’s determination to root out Vladimir Putin’s ‘mob of oligarchs and kleptocrats.'”
New York Times: “Oligarchs Got Richer Despite Sanctions. Will This Time Be Different?” — “For nearly a decade, sanctions have been little more than names on a list for wealthy Russians. Governments are working to give them bite.”
Forbes: “What Is An Oligarch? Here’s What You Need To Know About Russia’s Billionaires” — “Russian businessmen embraced post-Soviet privatization – and Vladimir Putin – to become extraordinarily wealthy. Here’s why we call them oligarchs.”
POLITICO: “Confiscating a Russian oligarch’s luxury condo requires much more than political bluster” — “Seizures can be further complicated by the fact that ownership of most if not all of the Russian oligarchs’ properties is shielded by shell companies.”
This article was originally published on WBUR.org.
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