Putin vs. His Oligarchs

Roman Abramovich
Photo: Phil Cole/Getty Images
Julia Ioffe
May 3, 2022

Catherine Belton’s book, Putin’s People, is the kind of work that comes around once in a generation and defines it. Just as David Hoffman’s The Oligarchs was the definitive account of the ruling class of the Boris Yeltsin era, Putin’s People is the best record of the Putin era. Starting in 1980s Dresden and taking the reader through to the present day, Belton shows exactly how Vladimir Putin used his position and connections in the K.G.B., and later the F.S.B., to build a shadowy financial empire, one that he has used to fund Moscow’s efforts to undermine the West. In Washington, the book made a big splash since it was published a year ago. It has been read and discussed everywhere from Capitol Hill and the White House to C.I.A. headquarters at Langley. Which bodes well for the U.S. government’s view of Russia: if they’re imbibing Belton’s meticulous and original reporting, as well as her accurate portrayal of how Putin’s Russia runs, then there’s a good chance they won’t be as misguided as in years past. 

I don’t just say that because Catherine is an old friend from our days as reporters in Moscow, though I’ll admit that I’m obviously a little biased. By the time I arrived in the Russian capital in 2009, Catherine had been living and working there for years, which she had started doing, off and on, since the Soviet collapse. And because she had been there in the relatively loose 1990s, she was on a first-name basis with many of the Yeltsin-era oligarchs. Like the rest of the foreign correspondents in Moscow, I had always looked up to Catherine, whose dogged and lucid reporting on the murky financial dealings of Russia’s oligarchs, had earned her the nickname “the Beltron.” She was a machine, yes, but it took more than that to find needles in the haystacks of financial disclosure, and to earn the trust of some of the most (justifiably) paranoid people in the country. Catherine deftly managed both, making her an absolute legend.

Ever since Putin made the criminally stupid decision to invade Ukraine, I’ve been wanting to talk to Catherine. I wanted to know what the oligarchs and the people in the Russian elite thought about the war, and if they had any appetite to stand up to Putin as so many in the West fantasized they might. I also wanted to know what Western sanctions would mean for these men. Would Western punishment peel them away from Putin—or drive them further into his embrace? And because Catherine was sued for the revelations in her book by several Russian oligarchs at once, including then-Chelsea owner Roman Abramovich, I wanted to know if the war had changed the way that Russian money had once muzzled the British press. 


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Our conversation has been edited for length and clarity. 


Julia Ioffe: You wrote recently about the muzzled discontent among the Russian elite. What do they say about the war in private? 

Catherine Belton: This week, Oleg Tinkov, the owner of Tinkoff Bank who spoke out publicly against the war, gave an interview to The New York Times, where he said he’d been forced out of his remaining stake in Tinkoff Bank— something like 35 percent—“for kopecks.” I’ve read that he had been offered $2 billion for that stake at the end of 2020. And now that stake is worth a tiny fraction of what it was then because the bank share prices collapsed [since the start of the war]. He told the Times that he was paid 3 percent of what he believed was its true value, purely because he was one of the very few who had spoken out publicly against the war. That’s what they’re all afraid of, because they all have business interests in Russia and they fear—even those who weren’t sanctioned—that, even if they leave Russia and don’t even speak out against the war, then someone from the Russian government will take over their businesses. It’s this conspiracy of silence. But when you do manage to speak to people in private, then yes, they are all shocked and horrified and completely taken aback by Putin’s decision to go to war. They weren’t really expecting it would go this far. 

That’s interesting because the hope in the West was that the sanctions would not just punish the elites, but peel them away from Putin and make it clear that being allied with Putin will cost you. But, from what you’re saying, they seem to feel that it will cost more to break with Putin than to bear the sanctions.  

I think the sanctions do have the effect that the U.S. and other Western governments wanted, because of course they’re chafing, they’re upset that the world is being overturned as a result of the war that they didn’t know about and many of them didn’t want in the first place. Everyone was expecting this kind of “normal” Putin-style limited operation where you can see how far you can push the envelope and get away with it. Everyone was expecting them to just recognize Donetsk and Lugansk as the independent republics and continue to threaten the West and Ukraine from the sidelines. No one was expecting that he was going to launch this full-on invasion. 

Everyone was stunned. I think it took a while for it to sink in what had actually happened. Everyone knew that sanctions would be coming, but no one knew how strong the West’s response would be. When you see 30 years of work of building a business empire suddenly just torn up and ripped apart, and the tens of millions you spent on burnishing your reputation in the West suddenly just thrown into the mud—of course, they’re very upset. I don’t think it throws them into the arms of Putin. It does create fissures in the elites but they just don’t know how to respond. 

As for whether they lose more by splitting with Putin than they do from Western sanctions, that’s not necessarily the case, because, as one senior banker put it to me, many don’t realize that their businesses are already worth nothing in the current environment. So as long as this war goes on, their businesses are not worth anything in any case. 

So then what’s keeping them from speaking out? 

Of course you hope that something’s going to change and you can just go back to normal. I think many are also frightened that they’ll see some kind of physical retribution as well. It’s not just losing your business. You fear that you could be poisoned or worse. 

Which, as we know, is not a crazy fear. Your reporting also underscores how little political power oligarchs have, and the extent to which they’re oligarchs because Putin allows them to be oligarchs. 


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Yes. Up to this point, they’ve benefited from this system in which they were able to become fabulously wealthy as long as they shared part of that wealth with the Kremlin or agreed to follow Kremlin orders. In my book, there’s a Yeltsin-era tycoon who says that they were bailed out by the Russian government following the 2008 financial crisis. And he says that if you get a call from the Kremlin and you get asked to spend $1 billion or $2 billion on this or that strategic project, you can’t say no, you have to comply. They’ve been feeding off this mutual system for years in which they agree not to rock the boat, not to criticize Putin, they agree to do favors for the Kremlin. Sometimes they do it voluntarily because they think then they will get brownie points and better business deals from the Kremlin. Putin was the guarantor of stability for their businesses, for their ability to make gazillions of dollars. But now it’s just completely been blown apart. 

Right, and in that system, Putin wasn’t asking them for political advice on, say, Russia’s foreign policy strategy. They didn’t have much political power in that sense. 

Yes. And there’s actually been a process in which they’ve become more removed from the decision-making process. In 2014, when Putin was gathering 150,000 troops at the border with Ukraine and threatening to invade, but decided to do the smaller operation in Crimea, I was told that people like Roman Abramovich were able to go to Putin and say, Look, the Western response, if you invade, is going to be really tough. You don’t have the support in the Ukrainian population to do this. 

At the time, Putin was pragmatic and listened to a much wider set of people. That is certainly not the case anymore because he has become ever more distant. A source told me that, though it’s always been the case that Putin mostly only listened to the F.S.B. on issues of global security and strategy and everyone else was kind of responsible for their own area outside of that, it’s become a system in which he’s become a lot more isolated. And that’s only increased after the pandemic. You and I have both heard the stories about how even those closest to him had to quarantine for two weeks under strict presidential guard before they actually got to see him. 

What do we know about who is giving him advice now? Who does he listen to? Who is in his inner circle? 


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It looks like he’s certainly listening to Nikolai Patrushev, the head of the Security Council. In the footage of the Security Council meeting where they were discussing recognizing the independence of the republics of Donetsk and Lugansk, Patrushev was pretty confident and almost telling Putin what to think. He was the one who was saying that America was using Ukraine to destabilize Russia, that our task is to defend our sovereignty and territorial integrity, and that the Ukrainians have been forced and frightened down a path of conflict. I watched it again and Putin’s trying to look like he’s bored, but actually he looks a little bit nervous when Patrushev is speaking. Patrushev has always been a bit more senior than him. 

How is he more senior than Putin? 

He’s older. He moved to Moscow before Putin. He moved there in 1994, and he always held pretty senior posts in the F.S.B.. 

Okay, sorry, I interrupted you. Who else is Putin listening to?

That’s where the trail seems to end for me. He’s in an echo chamber with Patrushev of where they drink their own Kool-Aid, it seems, because they will discuss this conspiracy of the West trying to use Ukraine to somehow undermine Russia’s stability. And then this has been projected back to them on state TV. So Putin turns on the TV, hears his own ideas projected back at him, and believes that he and Patrushev must be right. 


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One of the fantasies in the West has been the palace coup fantasy, that this will all end when the viziers and courtiers band together and get rid of Putin. Do you think that’s at all likely? 

We don’t know. His entire presidency now hinges on this war. His presidency used to be predicated on stability, on whether he could be a guarantor of stability within the country and the system under which all these insiders became fabulously wealthy. That’s now been completely uprooted and overturned. Now his legitimacy as president depends on his popularity, but his popularity now hinges on the effectiveness of the state propaganda and ultimately on his war in Ukraine. 

For now, state propaganda has been able to cover up the number of deaths among the Russian military, it’s been able to present this campaign against the Ukrainians as a war against Nazis, the bite of the sanctions hasn’t really hit home yet as it’s going to be a delayed process. But we’ve already had the Central Bank chairwoman speak about how it’s going to start hitting in a couple of months when shops run out of stocks, that almost all factories depend on imported components and they’re not going to be there any more, that inflation is going to start soaring to 22 percent, and the scale of deaths is already so enormous that they’re not going to be able to cover it up for a lot longer. As one of the business executives I spoke to put it, if Putin can achieve military success in the Donbas then maybe he’ll be able to to ride this out. But if he doesn’t, then there will be huge turmoil and infighting within the Russian elite. 

What would that turmoil look like? What would the factions be? 

I guess it would be the hardliners who would blame Putin for an unsuccessful war, for not pushing hard enough, versus the so-called technocrats, the people who are trying to paint themselves as liberals—whether you believe they are or not is another question. But these are people who have been horrified by the war and would try to push for a reintegration somehow with the West. That also touches on the interests of some members of the security services, because, of course, when you’re having your diplomats deported and when you have all your business networks under sanctions, you don’t have any instruments of soft power in the West anymore. If you’re a foreign intelligence officer, it’s very important for Russia to be integrated in the West because without that, you can’t mess with our democracies anymore. You have no influence agents. 


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That’s a really interesting point. But what will Putin be able to sell back home as a victory? He had such maximalist aims going in and now he’s reoriented toward taking the Donbas and making Ukraine a landlocked rump state. Do you think that’s something he can sell at home, not just to the population, but to the hardliners? 

I guess it depends. Some of the propaganda has been very effective and you can see that sort of resonating for a while with the Russian population. They don’t want to see themselves as the bad guys, so they’re automatically more willing to believe what they’re told by state propaganda. But again, it depends how hard the sanctions are going to hit and how many soldiers have to die before we get there. 


One of the most shocking things in your book is, weirdly, the introduction, which is about the extent to which the Russian government, through the oligarchs and their money, had co-opted the British political and legal systems—at least before the war. It is just absolutely shocking. To what extent is that changing now because of the war? 

It has changed perceptions considerably, especially in how the media covers individuals like Abramovich. For example, BBC Panorama, which is a well-known investigative weekly program, has been working on an investigation into Abramovich’s wealth since 2018, and it was only broadcast after the war began, because the legal climate was not conducive to allowing them to do so. It was focused on how he made his money, like the loans-for-shares auctions, and whether, as Abramovich himself admitted in U.K. court proceedings against [his former business partner, the late oligarch] Boris Berezovsky, that he he’d made corrupt payments in order to acquire the oil company, SibNeft. But in the U.K., as owner of Chelsea Football Club, he had a certain standing in society. He paid a lot of money to U.K. lawyers. He had Michael Peat, who is the former treasurer to Prince Charles, sit on the board of one of his steel companies, Evraz, in London. He had all these friends in high society who provided this refuge for him, and also these incredibly aggressive lawyers who became increasingly aggressive over the last year or so. At any sign of any newspaper wanting to write about his connections to Putin or anything involving corruption, his lawyers would come down on U.K. newspapers like a ton of bricks. 

There was even one instance when the Times of London retracted a story about Abramovich gifting a yacht to Evgeny Shvidler, his right hand man. It was based on Shvidler’s own testimony in the High Court. And yet the Times retracted it because at the first sight of a letter from Abramovich’s lawyers, they decided that it was too much trouble so they just removed the sentence, published an apology, and said it’s not true—even though it was the High Court testimony of Shvidler. It really shows the hold people like him had over the way the U.K. media has covered their businesses. 


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It changed overnight with the war. All of a sudden, it was like the ties were off, the media was unfettered and was able to write in a way that it hadn’t been able to do before. 

The way you describe it, it’s as if they were able to reproduce the same kind of climate of fear in the media that they created in Russia, but that they did so in London, in the U.K. 

It’s a different climate of fear because obviously if you’re a Russian journalist and you’re writing about corruption in Russia, then the consequences are much higher. We all know of the awful cases of journalists getting murdered in Russia. In the U.K., that doesn’t happen to you, but you could face a lawsuit which is going to take two or three years of your life and consume millions of pounds. It’s just a different type of threat. 

So many oligarchs had set up shop and established bases in London. They had these armies of lawyers and bankers and even lords working for them, and it was quite easy for them to start using the system to their advantage. We did have reforms to U.K. libel law in 2013 which made it better. Now you’re at least allowed a public interest defense, which is a big step forward. Before, the burden of proof was on the journalists. Still, the way the law is set up, in order to make that defense of public interest, it still takes years and it costs millions of pounds. You have to hand over all your computers and media devices and phones to a third party, and they check absolutely every step of your work. Just to get to the preliminary hearing stage in the Abramovich lawsuit, it cost the publisher £1.5 million. And had we continued to fight Abramovich [instead of settling], it would have cost £2.5 million in the U.K. alone and then another £2.5 million in Australia because his lawyers had doubled up. It was clear that they were trying to intimidate my publisher out of defending the claim.

Basically, the sheer cost of proceedings will cut off many journalists from going near anything controversial because it’s just not worth it. We had at least two U.K. newspapers who until recently just avoided writing about Russian oligarchs because it just wasn’t worth their while. 


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What do you make of Abramovich’s role in the Ukrainian-Russian peace talks? And is he doing this on behalf of the Kremlin or in order to launder his reputation in the West? 

It looks like all of the above. I also think the Ukrainians really wanted him in as well. They needed a backchannel to the Kremlin, somebody who can get access to Putin without having to go through official channels. He was approached by the Ukrainians. And of course, he gets to stave off the final wave of the U.S. sanctions. But it’s a double-edged sword for him because in the process he has revealed the fact that he can go and see Putin, which is also really risky because Abramovich has spent the last couple of years denying he has any ties to Putin at all. 

Was he really poisoned?

I think we still don’t know, but it certainly looks like something happened. I think if they wanted to really poison him, he would have ended up in a coma or maybe dead, like Alexey Navalny. Perhaps that was a warning of some sort. Abramovich’s detractors just say, oh, that was just a P.R. stunt but I’m sure something happened. But, as in any war, and in the Kremlin as well, there is a party of war and a party of peace. There are different factions who want different outcomes to the war. And clearly he was targeted by hardliners who don’t want the war to end.

The armies of lawyers and lobbyists and lords who are sitting on these Russian boards, where are they now? Are they all unemployed?


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Some of them. I think they don’t want to work anymore for the Russians. Carter-Ruck, which was representing [the Russian state oil company] Rosneft in the case against me, now has this announcement on its website that it doesn’t work with any sanctioned Russian entities or any government-linked Russian entities. They’re all distancing themselves like crazy. So yeah, I guess they’re going to have to look for new revenue streams. I’m sure they’ll find some. 

Are they suffering any reputational damage for having worked with some of these very unsavory Russian actors? 

You probably saw that a few weeks ago, there was a congressman named Steve Cohen who wrote to Antony Blinken, suggesting that some of these lawyers, including ones who represented the Russians trying to pursue me over the book, should face travel bans to the U.S. I’m not sure that that’s ever going to go ahead, but I think it certainly had a reputational effect.

Your case prompted the U.K. government to look at making further reforms to its libel laws, right?

I guess one of the silver linings in my case was that it did grab a lot of media attention because the onslaught was so great that it highlighted the failings of the current U.K. libel laws, that it’s so costly to defend oneself from them. And my cases have just been the tip of an iceberg. It’s not just me. As we spoke about, there were really so many newspapers who have just been self-censoring because they don’t want to deal with these costly lawsuits and as a result we really haven’t been getting a full picture on matters that are really of public interest. Because the Kremlin clearly overreached so much, there’s been a lot of support from members of Parliament. The Ministry of Justice has launched a consultation, talking with lawyers and other media organizations on how to reform U.K. libel law and how to prevent abusive cases coming to trial. 

I hope the momentum won’t be lost. It’s clear that there’s something deeply wrong with the U.K. libel law. But as to how long it will take, I just don’t know. 

The last question is one I’ve been asking everyone: how do you think this ends? 

It all depends on what happens in Ukraine. The war could now go on for years. 

If Putin dies of natural causes tomorrow, do you think the war ends with him? 

No. I’d be worried that somebody like Patrushev takes over. That would mean a continuation and perhaps another toughening of the line. 

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