Inside men

During the chaotic days after the invasion last year, Alexei Mordashov—the co-owner of the steelmaking company Severstal and the richest person in Russia—expressed both opposition to the attack on Ukraine and bewilderment that Western countries were responding with sanctions directed at him personally. “I have absolutely nothing to do with the current geopolitical tensions,” Mordashov said. “I don't understand why sanctions have been imposed against us.” Mordashov is one of Russia’s oligarchs, businessmen who’ve made billions since the fall of the Soviet Union through their connections with the Russian state. But they’re not part of the Russian state. There must, Mordashov implied, be some misunderstanding.

Altogether, Russia’s oligarchs have had more than US$58 billion frozen by Western authorities since the outset of the war, and they’ve lost more than twice that amid the continuing sanctions. As of March, the U.S. government is coordinating new efforts to liquidate their property, expand financial penalties against them, and close legal loopholes that have allowed them to use shell companies to move their money through the American financial system. There may be little sympathy for the oligarchs; it’s no secret, after all, that they made their money through corruption. But that alone doesn’t tie them to the war. What does?

Miranda Patrucić is the editor in chief of the Organized Crime and Corruption Reporting Project, a global network of investigative journalists with operations on six continents. As Patrucić explains, the oligarchs aren’t just beneficiaries of corruption in Russia; they’re key players in a whole system of corruption that Vladimir Putin continues to depend on—both to hold power at home and to extend influence abroad. Without this system, there is no Putin. And without systems like it, autocrats around the would be lost …

John Jamesen Gould: When Putin first came to power, part of his message and appeal was that he’d bring an end to the corruption of the oligarchs and a victory for the rule of law in Russia. What happened?

Miranda Patrucić: Early on, Putin spoke about opposing corruption, but he essentially told the oligarchs, If you play my game, you will do well; if you don’t—and certainly, if you try anything against me—I will crush you. Which is exactly what happened in the case of Mikhail Khodorkovsky, for instance—who was extremely wealthy and prominent in Russia but opposed Putin and lost everything in the country, was imprisoned for a time, and now lives in exile.

The combination of rhetorical anti-corruption and actual corruption has been a crucial element of Putin’s playbook from the beginning. He speaks the language of law and order, and then he gives money, access, and power to those who do what he wants them to do—and squashes those who stand in his way.