Billions lost to sanctions

While the world’s sympathies are clearly with the people of Ukraine as the mighty Russian war machine approaches, life for the average Russian has also become something of a challenge. The rouble has fallen by 40% and ATMs ran out of cash as people scrambled to get hold of their disappearing savings. Swift, the international payment system, cut off 80% of Russian banks. Flights out of the country were impossible to find and the institutions of state repression cranked up to levels not seen since the days of Stalin.

Even a once mighty oligarch such as Oleg Deripaska is reputed to be down to his last couple of billion dollars, after US sanctions imposed in 2018 detailed a shopping list of alleged criminal activities and banned businesses and banks from having any dealings with him. Deripaska’s fortune was made in the aluminium wars that followed the collapse of the Soviet Union, a period that is reputed to have involved business practices that would have been more familiar to fans of Genghis Khan than to any alumni of Harvard Business School.

Deripaska teamed up with Roman Abramovich in 2000 to found Rusal, which became one of the world’s biggest metal producers, and in 2017 he floated the En+ Group which holds his stake in Rusal in London. After the 2018 sanctions Deripaska was forced to surrender control of the companies, and now the talk is of carving out Rusal’s non-Russian assets into a separate company.

It’s something of a comedown for a man whose fortune peaked at $28bn, and things are only going to get tougher as fresh sanctions bite.