The Russia Conundrum

All in all, there are a few thousand people working for the Kremlin mafia, but between them they control a huge proportion of the nation’s wealth. They don’t keep the money in their own names and their own bank accounts – that would be far too obvious – but assign it instead to other people, who are told they need to keep silent or face serious consequences. The men Putin trusts with his money come from a small retinue of old friends, most of whom he now keeps at arm’s length. By maintaining a low profile, they are able to stay out of the spotlight, while holding the vast wealth that Putin can’t keep in his own name. The Panama Papers investigation of 2016 revealed that Sergei Roldugin, a professional cellist whom Putin has known since the 1970s, is the front-man for companies worth in excess of $2 billion, rather more wealth than most classical musicians have access to, with the money widely considered to be part of the cash Putin has plundered from the Russian state. Arkady and Boris Rotenberg, childhood friends of the president (Arkady is his former judo sparring partner), have been handed lucrative contracts from the state energy giant Gazprom and for infrastructure projects such as the bridge connecting Crimea to the Russian mainland. It’s made both of them billionaires and Arkady a ‘Hero of Labour’, an honorary title left over from the Soviet period. Gennady Timchenko, a Russian businessman and long-time ally of Putin who was formerly based in Switzerland but is now back in Russia because of international sanctions, is rumoured to hold billions of dollars on behalf of his old friend. Timchenko’s oil distribution business, Gunvor, served for many years as the conduit for overseas revenue from Russia’s energy sector, with the US Department of the Treasury claiming that ‘Timchenko’s activities in the energy sector have been directly linked to Putin, that Putin has investments in Gunvor and that he may have access to Gunvor funds’. A claim which Guvnor denies.Putin’s cronies all benefit from their association with him. They benefit from the commercial opportunities that he bestows, and they benefit knowingly from the criminal activities of the Kremlin mafia. The Siloviki occupy the commanding heights of power in politics, the economy and national institutions. They have at their disposal all sorts of powerful resources, including the FSB and the GRU, the foreign military intelligence agency. And they support each other as members of the same organisation. Their ideology is best described as nash-ism (‘ours-ism’), because it opposes ‘us’ and ‘ours’ to ‘them’ and ‘theirs’. They are beyond the reach of the law, so they are free to use violence against anyone who challenges them in any field – political, financial, journalistic. Their rule is, ‘if someone touches one of ours, he must suffer’. Because Putin and the Siloviki wield power on a personal and clan basis, public and state institutions have become irrelevant. The civilian oversight and control of the security forces that exists in much of the West is absent in Russia. The Siloviki are far from being a united group, however, and they encompass various cliques and groupings of shifting loyalties.

Of all the Siloviki, one of the closest to Putin – and the one with the most influence over him – has long been Igor Sechin. As Putin’s deputy chief of staff since 2000, Sechin oversaw the recruitment of KGB men to positions in the Kremlin. His position as Putin’s gatekeeper, in charge of the president’s diary, deciding who should be seen who should not, allowed Sechin to influence the direction of the country. He was a pragmatic hardliner who despised the civil liberty, free speech, pro-business policies of the liberals who had run the country under Boris Yeltsin. The Siloviki came from the security services, with a lifetime’s indoctrination that made them instinctively antagonistic towards the West; many of them regarded Yeltsin as a stooge of Washington. Once in power, Sechin’s behind-the-scenes influence helped to persuade Putin to ditch any remaining liberal sympathies and adopt the repressive, nationalistic policies that would come to define his presidency.