United Arab Emirates: The loophole of Russian oligarchs

More and more Russian oligarchs are creating their fortunes in the United Arab Emirates – and thus circumventing international sanctions against Moscow. Dubai attracts with unbureaucratic procedures – and few questions.

A meeting in Moscow a few days ago, in Ukraine Mariupol is being bombed. Two men sit across from each other at a large table: Russian Foreign Minister Sergei Lavrov and Abudullah al Nahyan, his counterpart from the United Arab Emirates.

Lavrov says they want to talk about the situation in Ukraine and how Russia will solve the problems that have been piling up there for years. His Arabic guest listens and nods. Lavrov goes on to say: “We welcome the balanced, objective stance recently taken by the United Arab Emirates.”

The veteran Russian chief diplomat thanks the United Arab Emirates for not condemning Putin’s war of aggression as a non-permanent member of the Security Council, but abstaining. That’s not all about the Russian-Arab partnership: Dubai also refuses international sanctions and, in the shadow of the Ukraine war, has become something of a “safe haven” for the assets of Russian oligarchs.

Oligarchs move billions to Dubai

Steel, oil and construction magnates, former members of the Duma or former provincial governors are currently relocating large amounts of assets to the Emirates. According to the New York Times newspaper, at least 38 Russian billionaires have parked their assets in the Emirates while American and European financial authorities are trying to freeze the foreign accounts of Russian oligarchs and confiscate their yachts and private jets.

So does Andrey Skoch, a former Duma deputy who is now active in the steel business and has an estimated fortune of around seven billion dollars. He and two other oligarchs are said to have managed to anchor their luxury yachts in the port of Dubai. The private jet of Arkady Rotenberg, a close friend of Putin, is said to have landed in Dubai and is therefore safe from Western access.

$80 billion seized

Save your fortune, if you can, seems to be the slogan of Russian oligarchs after France has frozen assets worth 800 million euros. According to the AP news agency, Italy has confiscated yachts and villas worth 156 million euros. At least $80 billion has been lost to Russia’s money elite as a result of the sanctions.

In the United Arab Emirates, on the other hand, rich Russians are welcomed with open arms. In the past few years, 40,000 Russian citizens have relocated their – mostly only apparent – residence to Dubai to bring their little ones to dry land. Now apparently heavy newcomers are added. It is said that the demand for villas has increased enormously since the outbreak of the Ukraine war. Average monthly rent for a luxury apartment: $15,000. Dubai confidential.

Countries circumvent sanctions with Dubai’s help

In recent years, states such as Iran, North Korea, Syria and Venezuela have used Dubai as a kind of financial hub to outmaneuver sanctions. The exact origin of funds is not questioned in the Emirates, residences are awarded unbureaucratically for large assets.

The Paris-based “Financial Action Task Force” – the most important international body for combating money laundering – put the United Arab Emirates on its watch list in early March. Apparently there are good reasons for this.