Oligarchs on the Run: How Sanctions are Changing Luxury Travel for Russia’s Elite
Oligarchs on the Run: How Sanctions are Changing Luxury Travel for Russia's Elite - Jetsetters Grounded
For Russia's ultra-wealthy oligarchs, the golden days of carefree jetsetting around the globe have come to an abrupt halt. With Western sanctions rendering their private jets unable to access EU and US airspace, these high-flying billionaires have found their wings clipped. No longer can they casually hop between posh homes in London, beachfront villas in Nice, and ski chalets in the Alps. The party, it seems, is over.
Nowhere is this more evident than at elite playgrounds like Courchevel, the ritzy French ski resort favored by oligarchs. Pre-sanctions, it was routine to see fur-clad Russians being choppered in from Geneva and Megève in their Gulfstream G650s and Bombardier Globals. Après-ski would be enjoyed in their sprawling chalets before heading home that evening. But this winter, the oligarch crowd has been conspicuously absent. With travel restrictions in place, these regulars simply can't reach their beloved ski chalets.
Of course, an optimist would say being grounded isn't the end of the world. There are still plenty of sunny places an oligarch can visit without crossing into Western allied territory. Destinations like the Seychelles, Maldives, and Dubai remain open to them. But make no mistake - this is still an immense lifestyle downgrade. Mind you, these are people accustomed to having access to anything, anywhere in the blink of an eye. For them, the inability to freely travel between their various properties is nothing short of catastrophic.
Understandably, this sudden loss of mobility has sparked a run on one of the last remaining options available - private jets registered outside Western allied countries. In a mad scramble, many oligarchs have been snapping up used Gulfstreams, Falcons, and other luxury jets recently deregistered in Russia. Of course, finding pilots willing to fly these planes is another challenge altogether. With the war in Ukraine ongoing, there is now tremendous stigma attached to operating jets owned by those perceived as Putin cronies.
What else is in this post?
- Oligarchs on the Run: How Sanctions are Changing Luxury Travel for Russia's Elite - Jetsetters Grounded
- Oligarchs on the Run: How Sanctions are Changing Luxury Travel for Russia's Elite - No More Mayfair Mansions
- Oligarchs on the Run: How Sanctions are Changing Luxury Travel for Russia's Elite - Yachts Seized, Villas Frozen
- Oligarchs on the Run: How Sanctions are Changing Luxury Travel for Russia's Elite - Swiss Banks Close Doors
Oligarchs on the Run: How Sanctions are Changing Luxury Travel for Russia's Elite - No More Mayfair Mansions
For Russia's oligarchs accustomed to splitting time between multiple luxury properties, sanctions targeting their real estate holdings have proven especially painful. Nowhere is this more evident than in London's tony Mayfair district, long a favorite stomping ground for this jetsetter crowd.
Pre-sanctions, it was commonplace to see industrialist billionaires like aluminum tycoon Oleg Deripaska and Chelsea FC owner Roman Abramovich owning several side-by-side mansions on Mayfair's posh streets. Russian billionaire Andrey Guryev, for instance, shelled out $160 million for Witanhurst Mansion, the second largest estate after Buckingham Palace in greater London.
But those glory days have come to an abrupt end. With ownership of these multimillion dollar homes being scrutinized, keeping them has become near impossible. Mansions once viewed as status symbols and weekend party pads are now financial liabilities. As a result, many oligarchs are rushing to offload their London real estate, with firms like Dalriada Trustees appointed to oversee sales on their behalf.
Andrey Guryev, for one, tried to quietly sell Witanhurst Mansion for $450 million before sanctions hit. But with assets now frozen, his family was forced to officially place the home on the market - except now, with ownership contested, it will sell for a fraction of what it's worth.
The same is happening across London's ritziest neighborhoods, with oligarch-owned mansions becoming mired in legal limbo. Without access to these homes, and no way to buy new ones undetected, an era has ended for Russia's ultra-wealthy. No more can they view luxury properties like Monopoly pieces to be collected on a whim.
Oligarchs on the Run: How Sanctions are Changing Luxury Travel for Russia's Elite - Yachts Seized, Villas Frozen
The inability to access luxury toys like yachts and vacation homes has proven especially galling for Russia's sanctioned elite. For these billionaires accustomed to globetrotting at will, having their most prized possessions frozen or seized has been nothing short of traumatic.
Nowhere has this loss been more acutely felt than along the luxe shores of the French Riviera. This fabled Mediterranean coastline has long served as a summertime playground for Russia's wealthiest. Flown in via private jet and whisked to seaside villas by helicopter, typical days were spent sunbathing on superyachts before drinks at Noga Hilton's Eden Roc restaurant. But with sanctions rendering their travel difficult and assets seizable, this glitzy routine has come to a screeching halt.
Take the sage of the nearly $1 billion superyacht Amadea, linked to gold magnate Suleiman Kerimov. This opulent 348-foot vessel, featuring its own helipad, pool and spa, had become a fixture off Monaco and Cap d'Antibes. That was until Fijian police, acting on a U.S. seizure warrant, stormed aboard and sailed Amadea out of reach of its owners.
While Kerimov denies owning Amadea, its seizure carries a clear message for oligarchs - assets like yachts and villas, no matter how cherished, cannot be protected. French authorities recently made this explicit by impounding a $120 million yacht linked to Igor Sechin, an ally of Vladimir Putin, in the port of La Ciotat near Marseilles. These aggressive seizures have prompted many oligarchs to relocate yachts to remote turfs like the Maldives. But even there, possession feels precarious at best.
And it's not just yachts at risk - equally coveted waterfront villas also face seizure. Take Petr Aven, the billionaire chairman of Russian's Alfa Bank, who regularly vacationed at his $40 million villa in Cap d’Antibes. With Aven now under sanctions, his villa has been frozen by French authorities. Russian billionaire Alexander Lebedev faces similar problems, with his sprawling beachfront estate in St. Tropez now unusable.
Oligarchs on the Run: How Sanctions are Changing Luxury Travel for Russia's Elite - Swiss Banks Close Doors
For Russia's oligarchs, having a Swiss bank account crammed with rubles and gold bullion has long been de rigueur. Yet in wake of sanctions, even the discretion of Swiss banking can no longer be relied upon.
In an unprecedented move, Switzerland has frozen over $11 billion in Russian assets and barred 7 Russian banks from its financial system. This serves a crushing blow to oligarchs who had viewed Switzerland's neutrality and bank secrecy as ironclad. No longer can mountains of questionable wealth be discreetly parked in Geneva and Zurich.
Now, Swiss banks are frantically offloading toxic Russian assets and shutting accounts linked to sanctioned oligarchs. Credit Suisse and UBS have been at the forefront, together dumping nearly $2 billion in Russian securities while scrutinizing clients for ties to the Kremlin. Even Swiss private banks like Julius Baer, traditional safe havens for Russia's ultra-wealthy, are now applying "zero tolerance" to sanctioned individuals.
For shareholders like billionaire Viktor Vekselberg, Switzerland's new hostility has shattered long-held illusions of security. Vekselberg's family office reportedly held over $2 billion in Credit Suisse accounts and considered Zurich their home away from Moscow. Yet with Vekselberg now blacklisted, even his Swiss real estate has been frozen.
Indeed, Swiss authorities are ramping up enforcement each day. In early March, just one oligarch yacht - the $120 million "Phi" - had been immobilized in Geneva. By April, over a dozen were seized including the $700 million superyacht "Lena" linked to Gennady Timchenko. Even neutral Switzerland now treats Russian assets as fair game.
The implications of these actions are immense for Russia's elite. They demonstrate nowhere left exists to safely shelter fortunes potentially derived from Kremlin ties and corruption. For oligarchs like Alisher Usmanov, Switzerland's sudden hostility reinforces the harsh reality - a life of exile awaits, devoid of access to their offshore riches.