Pity The Poor Russian Oligarchs
They’re Losing Ships, Boats and More
I felt terribly sorry when they took Alisher’s Dilbar, but somehow Alisher will be OK, I am sure. But I thought it was quite rude and more than a tad gauche of the German authorities to sneak in to the Hamburg, Germany, shipyard, without first notifying Dilbar, so they could abscond with the Russian oligarch’s $800 million yacht.
Alisher’s full name is Alisher Usmanov and his humongous, 512-foot long boat with lavish amenities that includes the world’s largest swimming pool on a yacht, was seized in part of a series of sanctions to punish Russian oligarchs during the ongoing Russian invasion of Ukraine.
Usmanov was sanctioned last week by the European Union (EU) as part of its response to Russia’s invasion of Ukraine. The EU has accused Usmanov of being a close ally of Russian President Vladimir Putin.
The Dilbar was built by German shipbuilder Lurssen, which claims it’s the world’s largest motor yacht by gross tonnage, weighing nearly 16,000 tons. When operating, the ship has a crew of 96 people, features an 82-foot swimming pool, two helicopter pads, sauna, gym and beauty salon and has 12 suites for accommodating 24 guests.
Usmanov took great issue with the invasion of his personal life, as would anyone whose $800 million super yacht with a classic profile with a light ivory hull and bronze accents, and an interior with rare and exclusive luxury materials, was snatched in the dead of night. He called the EU decision “unfair, and the reasons employed to justify the sanctions are a set of false and defamatory allegations damaging my honor, dignity, and business reputation.”
Roman Abramovich, you could be next and if I were you I would hire extra security to make sure the EU doesn’t target your super yacht, Eclipse. But the 553-foot long is probably pretty safe with its two helicopter pads, a mini submarine, three landing boats and a missile detection system.
So what and who are these oligarchs we’ve been hearing so much about?
The term “oligarch” derives from the Ancient Greek oligarkhia meaning “the rule of the few.” Russian oligarchs are the uber rich of Russia and along with their wealth, they have accumulated vast political powers. The first oligarchs rapidly accumulated wealth during the era of Russian privatization in the aftermath of the dissolution of the Soviet Union in the 1990s. The failing Soviet state left the ownership of state assets contested, which allowed for informal deals and plenty of bribery with former USSR officials as a means to acquire valuable state property.
Between 2000 and 2004, Putin reached an agreement that allowed the oligarchs to keep their powers in exchange for supporting Putin’s government. Many more business people have become oligarchs during Putin’s time in power and a number of them have been accused of various crimes, including tax evasion on their businesses.
Usmanov and Abromovich are among 118 Russian billionaires and are among those who control 35 percent of Russian wealth, according to a report by Credit Suisse.
The top five wealthiest and the creme de la creme elite power brokers are Alexei Mordashov at $29.1 billion, Vladimir Potanin at $27 billion, Vladimir Lisin at $26.2 billion, Vagit Alekperov and Leonid Mikhelson tied at $24.9 billion. Abramovich came in at 12th richest, at $14.5 billion of net worth. They made their fortunes in various fields, from steel, metals and transport to oil, gas and coal to real estate and pharmaceuticals. And some were especially clever. Pavel Durov made his $17.2 billion fortune through marketing a messaging app; Igor Bukhman’s $7.9 billion was made from online games; and Andrey Blokh parlayed his $1.9 billion portfolio from the sale of cannabis.
Usmanov, 68, made his wealth after the collapse of the Soviet Union through metal and mining operations, and investments. He is the majority shareholder of Metalloinvest, a Russian industrial conglomerate. Usmanov also owns a publishing house and is co-owner of Russia’s second largest mobile phone operator. After the Russian invasion of Ukraine, the EU blacklisted Usmanov with an EU-wide travel ban and freezing all his assets.
He owns mansions in Russia and England and a villa in Sardinia, and of course his treasured Dilbar, one of Usmanov’s two luxury yachts. Usmanov also is quite a philanthropist, having donated billions to charities including a sizeable gift toward the restoration of Rome’s Basilica Ulpia. Usmanov, who is Muslim, married Jewish Irina Viner, who is considered to be close to Putin.
Potanin, 61, is the second wealthiest Russian and the 10th richest man in the world. A former First Deputy Prime Minister of Russia, Potania acquired his wealth notably through the controversial loans-for-shares program in Russia in the early to mid-1990s.
Throughout Potanin’s tenure as CEO, his company, Norilsk Nickel, was named as one of the biggest polluters in the Russian Arctic and the city of Norilsk was named among the most polluted places on Earth. The FBI also reported in 2018 that ByteGrid, a data solutions provider contracted to store Maryland State Board of Elections data, was owned by a private equity firm in which Potanin is an investor. A retroactive investigative report issued by the U.S. Department of Homeland Security’s National Cybersecurity and Communications Integration Center found no indication that the MDSBE corporate network had been compromised but the contract has since been transferred to Intelishift as a precaution.
After the Russian invasion of Ukraine, Potanin stepped down as a member of the Board of Trustees of the Solomon R. Guggenheim Foundation in New York. Potanin is the only Russian to have signed The Giving Pledge, with a promise to donate at least half of his wealth to charity.
While he is merely the 12th richest Russian, Abramovich, 55, who is Jewish, is one of the most intriguing of the oligarchs. A published report said that Abramovich had suggested to former Soviet President Boris Yeltsin that Putin become the successor as Russian president.
Most recently, Abramovich caved in to pressures over the Russian invasion and agreed to sell his English soccer club Chelsea FC. Abramovich owns parts of Britain’s Evraz — a steel manufacturing and mining company — and Russia’s Norilsk Nickel — a mining and smelting company. He is also the founder of Millhouse Capital LLC, an investment firm. Abramovich also has been busy trying to unload his villas in England before they are seized.
As with other oligarchs, Abramovich got rich in the years following the collapse of the Soviet Union, obtaining Russian state-owned assets at prices far below market value in the loans-for-shares privatization program. It has been reported in court papers that Abramovich admitted that he paid billions of dollars for political favors and protection fees for shares of Russia’s oil and aluminum assets.
An investigation by BBC News Arabic found that Abramovich controls companies that have donated $100 million to the Israeli settler organization, the Ir David Foundation, which goes by the acronym Elad. Abramovich has reportedly donated more money to charity than any other living Russian, including $2.5 billion to build schools, hospitals and infrastructure in Chukotka. Abramovich was recognized by the Forum for Jewish Culture and Religion for his contribution of more than $500 million to Jewish causes in Russia, the U.S., Britain, Portugal, Lithuania, Israel and elsewhere over the past 20 years. In June 2019, Abramovich donated $5 million to the Jewish Agency for Israel, to support efforts to combat anti-Semitism globally.
Abramovich owns yachts that included Luna, the world’s second largest expedition yacht, before he sold it for $360 million in April 2014 to Farkhad Akhmedov, an Azerbaijani businessman, a patron of arts and philanthropist. He also owns The Bandit, a private Boeing 767, estimated to have cost $300 million with a a 30-seat dining room, a boardroom, master bedrooms, luxury bathrooms with showers, and a spacious living room. The aircraft has the same air missile avoidance system as Air Force One.