Vlad the Invader Vladimir Putin's name has
been in the news more than ever with Russia's invasion of Ukraine. Photos of his apparently
luxurious Russian mansion, complete with a pole dancing room, are broadcast in tabloids. They
show him as an extremely wealthy man, maybe even the wealthiest. But Putin's exact net worth has
eluded us forever. Nobody can pin an exact dollar amount to the Russian president for many reasons.
The United States, United Kingdom, and the European Union have all placed severe sanctions
on Russia, which would threaten Putin's assets. But it's been hard to ascertain the president's
assets. Apparently, as one of the richest men in the world, his net worth is up for debate.
Official sources from the Kremlin state Putin earns $140,000 per year and owns three cars,
a trailer, an 800 square foot apartment, and another 1,600 square foot apartment in
Moscow. Relatively meager holdings for a member of the world's wealthy elite.
It’s not uncommon for the world's richest people to earn millions of dollars per year,
while Putin earns a modest $140,000–at least on paper. An 800-square foot apartment
is slightly smaller than an average apartment in the United States. Surely,
the world's wealthiest man would have an apartment larger than "average."
Unlike Jeff Bezos, Bill Gates, Oprah Winfrey, Richard Branson, and so many other contenders
for the title of "world's richest," you won't find Putin on the Forbes Billionaires list. Why? Well,
Forbes has some strict policies. It considers assets and debts while excluding dictators
whose wealth is derived from their positions of power. A spokeswoman for Forbes stated
the company has been unable to verify Putin's assets. He's not a big fan of western media, so
getting him to share his financial information with the press is essentially impossible.
Speculation, Speculation, Speculation By some estimates, Putin's current net
worth is hundreds of billions of dollars. In 2012,
Russian political analyst Stanislav Belkovsky believed that Putin's net worth hovered around $70
billion, based on his investments in oil and gas companies in Russia.
These estimates only increased over the years. Swedish economist and author Anders Aslund
estimated Putin's net worth somewhere between $100 to $150 billion. He claims Putin's "inner
circle" holds millions, if not billions, worth of assets on the Russian president's behalf.
In 2017, financier and Putin critic Bill Browder testified that Putin is worth
more than $200 billion, making him richer than Jeff Bezos, Bill Gates, and Elon Musk.
Such estimates might seem outlandish, but they might not be far from the truth.
KGB Background On October 7, 1952,
Putin was born in Leningrad, in the former Soviet Union, now Saint Petersburg, Russia.
He’s the youngest of three brothers, but both of his older brothers died before he was born.
His oldest brother, Albert, passed away in infancy. His second brother, Viktor,
was lost during the Nazi siege of Leningrad during World War II.
Putin claims his paternal grandfather was a personal
chef for both Vladimir Lenin and Joseph Stalin.
In 1975, Putin joined the KGB, where he served as an intelligence officer for 16
years and eventually became lieutenant colonel. He resigned in 1991 during the
Soviet coup d'etat attempt against Russian president Mikhail Gorbachev.
In 1991, the Soviet Union fell, and Gorbachev resigned as leader of the
Communist party. A few days later, Ukraine and Belarus declared their independence from
the Soviet Union. It was then that Putin began his infamous career in politics.
President Putin In 1991, he was
responsible for international relations and foreign investments. He was investigated by
the city legislative council for understating prices and permitting metal exports in exchange
for foreign food aid that never arrived. They recommended he be fired. Instead,
he stayed in this position and continued to rise in the political ranks.
In 1994, he was appointed first deputy chairman of the Government of Saint Petersburg. In 1996,
Putin ran an unsuccessful election campaign for his former professor and mentor, Anatoly
Sobchak. After this, he moved to Moscow, where he was appointed deputy chief of staff for President
Boris Yeltsin, where he served until 1997. Yeltsin kept promoting Putin up the political ladder.
In 1999, Putin was appointed as one of three deputy prime ministers and
also acting prime minister of the Russian Federation. Then,
Yeltsin announced that he wanted Putin to be his successor. Putin agreed to run for president.
When Yeltsin unexpectedly resigned, Putin became acting President of the Russian Federation in
1999. He was officially inaugurated in 2000 and is still president today.
Putin vs. Yukos Here's where things
get interesting. In 2003, the richest man in Russia, Mikhail Khodorkovsky,
was arrested for fraud and tax evasion. With an estimated net worth of $15 billion, he ranked
16th on Forbes's list of billionaires. He made most of his money after the fall of the Soviet
Union when he obtained control of many Siberian oil fields, which fell under the name Yukos.
But in 2003, Khodorkovsky was arrested by Russian authorities, and President Putin froze his
shares of Yukos. Under Putin's direction, the Russian government took action against Yukos,
which led to a significant fall in share prices and destroyed Khodorkovsky's wealth.
The company was bankrupted, and assets were auctioned below market value. But some believe
Putin's harsh treatment of Khodorkovsky has more to do with his previous criticism of
the president and donations to Communist and liberal opponents to Putin's regime.
Khodorkovsky's trial was broadcast on national television. He and his business
partner Platon Lebedev sat in a barred cage while defending themselves. After a complaint
to the European Court for Human Rights, they were placed in a plexiglass tube.
In 2005, Khordovsky was sentenced to nine years in prison. He spent more than half of his time
in a 246-year-old Moscow Detention Facility with harsh conditions such as cramped cells,
a hole in the ground for a toilet, cold meals, and little access to the outdoors.
In 2010, while he was still in jail, he was found guilty of embezzlement
and money laundering. His prison sentence was then extended to 2014.
During his jail time, Khordovsky became a trusted
public figure in Russia for having the courage to stand up to Putin.
Putin's favorability in Russia declined even further when it was found that much of his
estimated $200 billion net worth comes from extortion. Fund manager
Bill Browder believes 50% of Putin's wealth is held by oligarch trustees–or
Putin's "friends." These Oligarchs are so wealthy and powerful that they have
significant sway over political and economic decisions. Putin extorted them for 50%
of their wealth and sworn allegiance. In exchange, they're allowed to keep their "power."
Many believe Putin's money hides in western hedge funds, real estate,
investments, and other money vehicles.
Black Sea Palace It's widely believed that
Putin used the oligarchs' deep pockets to fund his life. Much of his wealth might be
kept in the Black Sea Palace, a luxurious megamansion worth at least $1 billion.
It’s a country palace styled after 18th-century tsars, with a columned facade, a private theater,
landing pads for three helicopters, and accommodations for security guards.
Putin built the palace using a secret fund held by a group of Russian oligarchs,
thus proving Putin has free access to corporate and personal wealth.
But it doesn't stop there. If the rumors are true,
the Black Sea Palace is just the first in a series of Putin's holdings,
including 20 other palaces, four yachts, 58 aircraft, and a watch collection worth £400,000.
While 20 million people in Russia live paycheck to paycheck, Putin enjoys unfathomable wealth.
Ukraine The current Russian-Ukrainian war
is actually something that’s technically not that new. It actually began in February 2014
after the Ukrainian Revolution of Dignity. During the first eight years of the conflict,
Russia annexed Crimea and engaged in a war in Donbas between Ukraine and Russian-backed forces.
After a military build-up at the Russia-Ukraine border in late 2021,
NATO accused Putin of planning an invasion, which he denied. In turn,
Putin criticized NATO as a threat to Russia and demanded that Ukraine never be allowed
to join the military alliance. In February 2022, Russia launched a full-scale invasion of Ukraine.
Sanction Everyone but Putin Many nations have condemned Putin's invasion of
Ukraine, arguing that the war breaks international law by disrespecting the nation's independence.
They implemented economic sanctions against the Russian government, people, and companies. Western
countries also imposed asset freezes and travel bans on Russian oligarchs in Putin's inner circle.
Companies are no longer allowed to do business with these members of the Russian elite. The US
has barred some of Russia's banks, such as PJSC Sberbank and VTB Bank, from conducting
business with the US market. The EU is planning to block Russian banks and state-owned companies.
The UK is even banning Russian airline Aeroflot from landing in the country.
But some sanctions harm many individuals who
aren’t involved with the war. They may not even support Putin at all. Which begs the question,
why are these sanctions targeting Russia in general and not Putin directly?
Some countries may be sparing Putin's personal interests in the hopes of a diplomatic resolution.
Despite President Biden's tough economic sanctions, he chose not to exclude Russia from
the SWIFT international banking system at first, calling it a "nuclear option." SWIFT stands for
the Society for Worldwide Interbank Financial Telecommunication and helps connect over 11,000
international banks, financial firms, and companies in more than 200 countries.
Trillions of dollars in transactions get processed through SWIFT every day.
Russia's removal from SWIFT would severely harm the economy and its ability to participate in
global trade. Russia would have to rely on outdated technology like fax and email to conduct
overseas transactions. However, political strategy changes almost every day. A few days after calling
it the 'nuclear option,' the US, UK, Canada, and EU agreed to take several Russian banks off SWIFT.
Western governments are treading lightly and implementing sanctions
slowly to not cause immense and sudden political destruction. President Joe Biden also decided
to exclude aluminum manufacturing and the energy sector from the sanctions.
Oil and gas prices are already rising, and further sanctions could cause them to increase even more.
Since Putin's net worth is relatively unknown, it’s hard to estimate the damage
if countries implemented sanctions that targeted the Russian president.
American companies have also taken action against Russia. Two weeks after the invasion of Ukraine,
McDonald's closed 850 restaurants throughout Russia. But the company is facing considerable
backlash from shareholders because 9% of the company's profit in 2021
came from Ukraine and Russia. The price of McDonald's shares is now on a steady decline.
Why Not Vlad? According to
the New York Times, some European states want to exclude Putin and Russian Foreign
Minister Sergey Lavrov from the sanctions to keep communication open with Russian
leaders. That's the official reason, but it might not be the whole truth.
Personal sanctions might not be that effective in freezing finances or
changing behavior. These oligarchs have so much money that economic consequences might
marginally affect their pockets.
These Oligarchs run the largest companies in Russia. They'll still find ways to make money,
even in the face of global sanctions. As for Putin, his secret stashes of cash
hidden around the world should make anyone question how the global economy really runs.
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slap Vladamir Putin in the face or slap Mike Tyson in the face?