72 - Follow the Money: Putin, Oligarchs, and Syria
Putin’s invasion of Ukraine is not necessarily going to be turned back by Treasury Secretary Janet Yellen’s clever idea to establish a reverse cartel in order to reduce Russia’s returns on sales of petroleum. China and India might end up receiving even steeper discounts than they now pay Russia for oil if Yellen’s maneuver manages to reduce what Europe, Africa, and the Americas proffer Putin for his fuel, but agreeing on low-balling Putin, and managing the process, presumably depends on how desperate Putin is to sell his oil at any price, and whether world markets can be manipulated artificially.
Putin, alas, is not desperate. Sanctions are biting, but not that dramatically so far. Regular Russians are beginning to hurt, but only at the margin. There are no major food shortages, only the absence of some kinds of luxuries. Indeed, the war has led to rising prices for oil and natural gas. Unanticipated lavish profits feed into Putin and allow the war to be fought punishingly in the Donbas.
A democratic society with a free press and freedom of expression would resist a senseless war. If Russians were allowed to know what was happening on the ground in Donetsk and Luhansk they might well protest. Or, if the thousands of body bags containing dead young Russian soldiers actually were being returned to their mothers and villages, the war might be nearly over. But that is clearly not what happens in today’s Russia, thousands of intellectuals and possible dissident having already fled away from Moscow and St. Petersburg to more hospitable environs.
Putin’s Wealth
Russians might also rise up in arms if they knew how much of their taxes and other earnings had found and were continuing to find their way into Putin’s personal pocket. A scorching examination by the Organized Crime and Corruption Reporting Project (OCCRP) late last month indicates that eighty-six holding companies worth at least a total of $4.5 billion, each tightly linked to a central conglomerate tied closely to Bank Rossiya, likely represent Putin’s proceeds from years of sweetheart deals, influence peddling, skimming the public purse, and every manner of grand corruption. The new information arrived as a trove of email metadata leaked to the investigative journalists who have long been on Putin’s trail.
Putin’s enormous palace near Sochi on the eastern shores of the Black Sea was revealed by Alexei Navalny and others. But Putin also has a prized villa north of St. Petersburg, acres of vineyards, the Igora ski resort, and a host of investment holdings. The eighty-six properties also include jet business aircraft, dozens of yachts, and listed bank accounts filled with cash. A charter air company called Russair may provide service only for Putin. The petrochemical firm Sibur and the natural gas producer Novatek are also tied to the Putin conglomerate.
Admittedly, Putin claims to be parsimonious, and wealthy oligarchical partners and friends of long standing such as Arkady Rotenberg, Sergei Rudnov, and Gennady Timchenko always step forward and claim the properties as their own. They do the same for yachts that may or may not belong to themselves or to Putin. Even Roman Abramovich, who once owned the Chelsea Football Club and has investments in the United States, is suspected of fronting and money laundering for Putin. Svetlana Krivonogikh, reputedly one of Putin’s mistresses, nominally holds some of these assets.
The Syrian Connections
Timchenko a few days ago was also linked to the export of phosphates mined near Syria’s famed archaeological site of Palmyra. European Union sanctions on Syria ban trade in oil and other minerals, but not specifically phosphates (used to produce fertilizer). Profits from this shady shifting of phosphates benefits the regime of Syrian dictator Bashar al-Assad, billionaire Timchenko, who facilitates, and possibly Putin. Timchenko is personally sanctioned by Europe and any dealings with Syria risk running afoul of U. S. sanctions. “Timchenko denies allegations that he is one of the fronts for Putin’s personal wealth, saying the pair are just judo partners.” (Guardian, June 30)
Timchenko owns Stroytransgaz, a Russian company, that now controls phosphate properties in Syria. Russian security guards the phosphates from Palmyra to a Russian-controlled port on the Mediterranean Sea. Ships involved in carrying phosphates from Syria turn off their identifying transponders to avoid detection. They proceed to ports in Bulgaria, Italy, Poland, Serbia, and Spain. Thus Europe is complicit in providing tidy profits for at least one of the oligarchs who is tied tightly to Putin. Even Syria helps to bolster his wealth and influence.
Ironically, Ukraine before the war imported Syrian phosphates to make its own fertilizer. But since Russia has seized or blockaded its ports, direct access to illicit goods from Syria is hardly available.
Stopping Putin must continue, at all costs, until his many ways of profiting from war are stopped.
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