The dozens of Russian elites sanctioned by western countries over the invasion of Ukraine include some of the richest people in the world. There’s Alexei Mordashov, the biggest shareholder of major Russian steel maker Severstal, aluminum billionaire Oleg Deripaska, and Chelsea soccer team owner Roman Abramovich.
The list also includes Russian president Vladimir Putin, though officially he’s a man of relatively modest means.
Because Russian oligarchs tend to hold a lot of their wealth overseas in real estate or via layers of companies, it’s hard to freeze or seize a lot of it. The value of assets held by Russian companies or individuals in Switzerland is only around $11 billion, according to Swiss bank data, while the UK government says two tycoons alone, Alisher Usmanov and Igor Shuvalov, are worth nearly $20 billion.
A 2017 paper (pdf) from the US National Economic Research Bureau, economists Filip Nokovmet, Thomas Piketty, and Gabriel Zucman, known for their work measuring wealth and inequality, took a stab at a more realistic estimate.
The authors used national economic data, household surveys, tax data on high-income earners available since 2008, and wealth rankings to estimate public, private, and offshore wealth and form a picture of the changes from the Soviet period. A discrepancy between the growth of trade surpluses and that of net foreign assets, for example, signals capital flight.
The paper estimates the offshore wealth held by rich Russians at around $800 billion as of 2015, or around three times larger than the country’s official net foreign reserves. “That is, there is as much financial wealth held by rich Russians abroad—in the United Kingdom, Switzerland, Cyprus, and similar offshore centers—than held by the entire Russian population in Russia itself,” it said.
Around 60% of rich Russians’ wealth is estimated to be overseas, according to a separate NBER paper on tax havens. The Atlantic Council, meanwhile, estimates Russians have $1 trillion of shadow finances abroad.
It depends on which wealth ranking you’re looking at.
Mordashov is Russia’s richest man, according to Forbes’s annual billionaire’s list which puts the combine net worth of him and his family at around $29 billion, thanks to the businessman’s stake in Severstal. He also owns a third of one of Europe’s biggest tour operators Tui.
According to Bloomberg’s billionaire index, Mordashov is currently ranked as the third richest Russian with a net worth of $21 billion, while tycoon Vladimir Potanin is ranked as the country’s top billionaire with a net worth around $24 billion partly thanks to his stake in Russia’s leading metals and mining company Norilsk Nicke.
The combination of the privatization of state assets after the fall of the Soviet Union, and corruption, led to the concentration of a lot of wealth in a few hands. Looking at Forbes billionaire ranking, the paper noted billionaire wealth appeared to be 25% to 40% of national income between 2005 to 2015, more than the 5% to 15% in the US, Germany, and France over the same period.
The authors noted that China too has seen an increase in both wealth and inequality since its market reforms. But in China’s far more diverse economy, real estate and natural resource tycoons have increasingly been joined in the last 20 years by self-made tech entrepreneurs.
That is far less common in Russia, though in 2021, Tatyana Bakalchuk, a 44-year-old former teacher who founded online clothing retailer Wildberries, became Russia’s wealthiest woman.