Today, the Guardian and its reporting partners are launching the Russian Asset Tracker, the most comprehensive audit ever published of wealth held outside Russia linked to some of the country’s all-powerful oligarchs and officials.
We looked at the ownership of 145 assets, worth over $17 billion, including real estate, yachts, private jets and shares in companies. The information, which dates from 2020 to the present day and serves as a snapshot in time, was assembled in collaboration with the Organized Crime and Corruption Reporting Project, Süddeutsche Zeitung and 25 other media.
The project was conceived in February, when the armed forces of the Russian Federation were massing near the borders of Ukraine. It begins with a list of 35 people named last year by imprisoned opposition leader Alexei Navalny as “key enablers and beneficiaries of the Kremlin’s kleptocracy”. At the time, Navalny called for tougher sanctions to limit Vladimir Putin’s influence.
Three weeks after the invasion, 27 of these individuals are subject to sanctions in the United States and Europe. Seven others have been blacklisted in Canada. In the language of UK sanctions law, they are accused of “obtaining an advantage from or supporting the Russian government”.
The Navalny list includes four of the wealthiest oligarchs, as well as heads of state-controlled banks and energy companies, top broadcasters, heads of spy agencies, ministers, political advisers and regional governors.. Over the next few weeks, the Russian asset tracker will expand to cover a wider group of sanctioned individuals.
Many denied being close to Putin or benefiting from his regime. For now, however, their assets are frozen, they cannot be sold or used for profit. There are severe restrictions on these people’s ability to travel, spend money and use their villas and penthouses.
In order to avoid an escalation of the war in Ukraine, the UK and other governments are seeking to use financial measures to weaken Russia and punish those who profit from its economy. However, these sanctions will only be effective if they are applied.
The wealth of the oligarchs can be difficult to trace. While some investments, such as Chelsea Football Club, are held in public view, many are not. Ownership is often masked by shell companies and trusts, located in tax havens.
That’s why our journalists have gathered data from a number of sources over the past six years, including offshore leaks published by the International Consortium of Investigative Journalists and reports of suspicious banking transactions contained in FinCEN files.
It is not illegal to hold wealth offshore, and there are legitimate reasons for doing so, such as confidentiality. However, the data we reviewed shows that banks have sometimes raised questions about unexplained wealth or the origin of funds flowing through accounts.
Our research extended to relatives and associates, as in some cases their wealth comes almost entirely from the sanctioned person. The inclusion of family gives a fuller picture of the magnitude of wealth. In other cases, they could be used to conceal or disperse assets – wives holding shares on behalf of husbands or trusted enablers acting as proxies.
The United Kingdom has recognized this by imposing sanctions on certain family members. In a February 26 statement from the White House, Western allies announced the creation of a Transatlantic Sanctions Task Force to pursue “officials and elites close to the Russian government, as well as their families, and facilitators to identify and freeze the assets they hold in our jurisdictions”.
The City of London has for years been criticized by politicians and campaigners for opening its doors to money of questionable origin in return for generous commissions paid to lawyers, auditors and fund managers.
For government critics, this may explain why the UK was initially slower than other countries in its response to Ukraine, lagging behind the EU in blacklisting individuals.
In a time when ill-prepared and often underfunded law enforcement struggles to identify who owns what, helping to expose hidden wealth and those who benefit from it is a vital task. This can prevent dispersal and encourage enforcement.
Since 2016, with the publication of the Panama papers, relentless media reports have shown the need for greater transparency and regulation in the offshore world. Reform was slow and often met with political resistance. The difficulty in enforcing the latest sanctions suggests there are still plenty of places to hide.