Being an oligarch isn’t the sweet gig it once was.
Not that long ago, a week in the life of a Russian billionaire might have involved flitting between a lavish Moscow dacha, a sprawling Belgravia mansion and a sun-drenched Monaco villa.
Private jets would do the job for long hauls, Bentleys and Ferraris would be waiting on the drive for the Harrods run.
But none compared to the preferred method of travel, the ultimate combo of convenience, leisure and pomp: the mega-yacht.
Russian money has flooded into the exclusive industry over the last 20 years and financed increasingly decadent vessels.
Europe has benefited. According to industry title Yachting Pages, the 10 best luxury ship-building yards in the world are all in either Italy, Germany or the Netherlands.
Eye-watering sums have changed hands for these floating mansions.
In 2004, aluminium magnate Oleg Deripaska took receipt of a £50 million boat constructed on a yard in Bremen.
His 232ft-long vessel looked opulent beyond belief at the time but would soon look like a pleasure cruiser compared to what was to come.
Roman Abramovich’s £300m yacht left its manufacturer in Hamburg in 2010, then the largest in the world at 530ft-long.
Spread over five levels and replete with a swimming pool, hot tubs, a helicopter landing pad – and even, if reports are to be believed, a missile detection system – the Eclipse is the boat of every Bond villain’s dreams.
In 2015, Alisher Usmanov – an Uzbek-born industrialist who rose to become one of Russia’s richest men and investor in two Premier League football clubs – paid a reported £610 million for the Dilbar, the largest bespoke yacht ever built.
They’re all at it: Putin’s ‘right hand man’ Igor Sechin has his 280ft Amore Vere and, reportedly, the £450m Crescent; fertiliser tycoon Andrey Melnichenko has his equally expensive Sailing Yacht A (built with the help of a British firm); Alexei Mordashov, a member of Russia’s ‘richest family’ whose business career stated in Newcastle-upon-Tyne, owns another of the world’s largest, the Nord.
So what’s the appeal?
Tom Keatinge, director of the Centre for Financial Crime and Security Studies at the Royal United Services Institute, told Metro.co.uk they provide two priceless commodities: seclusion and clout.
He said: ‘Obviously, these people value their privacy, they value the exclusive lifestyle and so of course, a mega-yacht ticks a lot of boxes.
‘It’s a sort of a status symbol and it’s a tool of influence.
‘If you invite politicians – like politicians from the UK have done in the past – to go and spend a few days or have dinner on these yachts in the south of France, it’s a very effective tool.’
A notorious example of that revolved around the Clio, Oleg Deripaska’s aforementioned boat.
In 2008, George Osborne, then shadow chancellor, and Labour’s newly-appointed EU trade commissioner Peter Mandelson clambered aboard for an evening’s entertained.
Mr Osborne was forced to deny attempting to solicit a donation to the Conservative party when details of the meeting were made public.
But for all the sway and tranquillity they can provide, mega-yachts are financial blackholes.
Their value might increase once the various accoutrements are fitted but the price of ongoing upkeep is astronomical.
Staffing costs, harbour fees and maintenance expenditure run into the tens of millions every year – but for the oligarchs, that isn’t a concern.
Russia’s billionaires – the first batch of whom made their money by snatching up former state enterprises in rigged auctions – have hoarded extreme wealth since the fall of the Soviet Union.
In 2021, Forbes put 117 Russian billionaires on its rich list, just 19 short of Germany despite the fact its economy was two-and-a-half times smaller.
They have made or retained their wealth by following the golden rule of doing business in Putin-land: keep your mouth shut.
But now this billionaire class are pariahs in the West, tainted by their association – either via direct acts of complicity or dutiful silence – with Russia’s war-mongering leader.
Their prize assets are frozen, unable to leave European harbours or be sold.
These include: Sechin’s Amore Vere, impounded near Marseille, and his Crescent, moored indefinitely down the coast from Barcelona; Melnichenko’s Sailing Yacht A, held off Trieste; and Usmanov’s Dilbar, stuck in Hamburg.
A 190ft boat owned by an unidentified Russian billionaire is currently static in Canary Wharf and the UK government is actively looking at others.
Unlike houses, financial assets or football teams, yachts provide another useful function for billionaires with potentially suspect political ties: you can move them in a hurry.
As Russian troops surged into Ukraine, Abramovich scrambled two of his prize boats to Turkey (which hasn’t imposed sanctions, citing its role in hosting peace talks).
At time of writing, Oleg Deripaska’s Clio – the boat Mr Osborne admitted visiting – was hot-footing it from the Maldives port where it has remained static for two months, up the Suez canal and on towards Turkey.
‘I don’t think they bought them mindful of the fact they might be sanctioned’, Keatinge said, but where they turn up ‘highlights the fact that there are actually very few countries in the world which are willing to support the West’s actions in supporting Ukraine’.
‘Where these yachts have gone to gives you an indication of the political position that these countries are taking.’
The use of shell companies and tax havens make the world’s wealth incredibly difficult to trace and Putin is perhaps the world’s best example of this.
Officially, he makes less money than Boris Johnson but it’s widely thought his secret personal fortune runs into the billions, perhaps far enough to make him one of the richest people on the planet.
He is not immune to the allure of the mega-yacht himself. The £530m Scheherazade, impounded on the Tuscan coast, and the 270ft Graceful are reportedly among his fleet, although this has not been independently confirmed.
Despite the use of instruments which obfuscate ownership, Keatinge said he thought governments were doing a good job of identifying yachts in the face of huge difficulties.
He said: ‘Normally if you’re trying to figure out who owns an asset, you worry about shell companies and all that kind of stuff.
‘There’s another dimension when it comes to vessels, which is that not only are they owned through a complicated structure, they also have a flag they fly under….which does control to some degree control what you can and cannot do.
‘Right now, if you if you were an oligarch with a yacht, if you happened to fly under a UK flag or a European flag you would probably be re-registering yourself somewhere else as soon as possible.’
Despite the sanctions against hundreds of individuals linked to Russian business, politics and military, the war rages on.
Volodymyr Zelensky begs for more to be done on a daily basis in video addresses issued from the Kyiv base he oversees his country’s defence from.
Impounding yachts provides a good PR win for Western governments but, Keatinge fears, it won’t change the course of the war.
‘The reason that we sanction these individuals is not, frankly, because we think it’s going to change Vladimir Putin’s calculations’, he said, ‘we sanction them in the UK because we should have done something about their money a long time ago so now is an opportunity to do something.
‘It also keeps the issue of the war and Putin’s invasion in the public eye, there’s definitely a sort of a public relations value to all of this.
‘But there are a finite number of names that one could put on the list…and what have we achieved by sanctioning the people we have sanctioned so far?
‘Not much as far as I can see.’
Oleg Deripaska’s yacht is perhaps the best example of the rise and fall of the ability of Russian wealth to cash cheques.
The Clio: Built in Europe; bought with the proceeds of state industry; free to sail into the continent’s most exclusive ports; used to wine and dine Western lawmakers; now forced to race around the world to avoid the closing net of punitive measures.
Western governments have vowed to keep sanctions in place until Russian troops have left Ukraine’s territory, an outcome which seems to be months or even years away.
The scattered fleet of the Russian elite will in all likelihood sail up the French Riviera once again.
But as long as the war in Ukraine rages, mega-yachts owned by oligarchs will remain fugitives on the high seas – or as gently bobbing reminders in Europe’s harbours of a recent era where money talked and governments didn’t.
Russia-Ukraine war: Everything you need to know
Since Russia’s invasion of Ukraine began on February 24, the country has suffered widespread damages and loss of life amid a major bombing campaign.
Millions of people have fled the country, with thousands of British people opening up their homes to Ukrainian refugees.
During the course of the war, Ukraine’s President Volodymyr Zelensky has remained in Kyiv, despite the Ukrainian capital being subjected to a barrage of bombing.
Zelensky has continuously pushed for aid and support from world leaders, as well as pressing for fast-tracked NATO membership.
Meanwhile, Russia’s President Vladimir Putin has been widely condemned for his attack on Ukraine.
His actions have been met by harsh economic sanctions, bans from competing in major sporting events, and countries moving away from using Russian oil.
- When did Russia invade Ukraine? A war timeline of important events
- How can I house a Ukrainian refugee or family?
- Where to buy a Ukraine ribbon pin
- When did President Vladimir Putin come to power?
- Who is Ukrainian President Volodymyr Zelensky?
- What is Ukraine’s currency, language, and what does its flag symbolise?
- Does Russia have any allies and what have they said about Ukraine?
- What is NATO and which countries are members?
- How to talk to children about what’s happening in Ukraine
- How to cope with World War Three anxiety
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