Fresh humiliation for Russia’s elite with new law targeting Putin’s oligarchs

There could be a “massive blow” coming for Russia’s oligarchs, with a new law aiming to hit them where it really hurts.

The invasion of Ukraine has turned the spotlight on Russia’s oligarchs – a privileged group of elite billionaires with unparalleled access to President Vladimir Putin and the halls of power.

Many Western governments have reacted to the invasion by coming after these wealthy businessmen, by freezing their overseas assets as a way of punishing them directly and as a means of potentially pressuring Mr Putin to backtrack.

So far, Australia has joined a string of other nations including Canada, the European Union, New Zealand, the United Kingdom and the United States in cracking down on “key Russian individuals”.

But now, a new law could humiliate and punish the oligarchs even further as the invasion rages well into its third week.

A bipartisan group of US senators have announced proposed legislation which would not only allow the government to seize and sell oligarch’s assets, such as yachts and art – but would also enable proceeds to go directly towards humanitarian aid to assist Ukraine.

Chelsea's Russian owner Roman Abramovich is one of the best-known oligarchs to be hit with sanctions. Picture: Glyn Kirk/AFP

If passed, the Asset Seizure for Ukraine Reconstruction Act would allow the seizure of assets of those linked to the Russian government worth over $US2 million ($A2.7m), with profits used “only for the benefit of the people of Ukraine”.

Senator Sheldon Whitehouse, one of the politicians spearheading the Act, said in a statement that it was time to clamp down on Russia’s “dirty money” in a constructive way.

“Putin and his oligarchs stow their dirty money in rule-of-law nations by purchasing mansions, mega-yachts, artwork, and other high-value assets,” Mr Whitehouse’s statement reads.

“We ought to seize those ill-gotten luxuries and put them to use helping the Ukrainian people.

“That would be a measure of justice for a nation besieged by a corrupt dictator.

“We remain united in our commitment to levelling a massive financial blow on Putin and his oligarchs.”

Superyacht Solaris, owned by Roman Abramovich, sails towards the luxury yacht marina Porto Montenegro on the Adriatic coast. Picture: Savo Prelevic/AFP

Fellow Senator Roger Wicker said in a statement that the ability to actually seize the luxury goods gives the Department of Justice “increased latitude to act swiftly in preventing the liquidation of assets by Russian oligarchs”, while Senator Lindsey Graham said “dictators like Putin care only about themselves and their cronies”.

“It is long past time for all the Russian oligarchs – Putin’s partners in crime – to lose their yachts, luxury apartments, and their assets and pay a price for being part of a thuggish group – a nation-state that really is a mafia-state,” Mr Graham continued.

“I want to see the Department of Justice, Treasury, and law enforcement partners go in and take apartments, fine art, and seize yachts from a bunch of thugs and crooks.

“I want to put money on the table to have more weapons for Ukraine to fight. This is a good beginning on the long journey to push back against Putin and his misadventures.”

In a recent article, The Economist estimated that around 70 per cent of the wealth of Russia’s billionaires is linked to “crony capitalism”, a term which describes the practice of businesses plotting with government officials in exchange for profits and financial benefits.

The crackdown on oligarchs is designed to hurt Russian President Vladimir Putin. Picture: Mikhail Klimentyev/Sputnik/AFP

If the Act were to pass, the money gained from the sale of the oligarchs’ assets would go towards several areas such as supporting Ukrainian refugees, providing military aid and assisting with reconstruction once the invasion is over.

Some of the cash would also go towards technology to prevent Russian attempts to shut down internet access in Ukraine as part of a concerted effort to censor the events of the invasion.