For the past thirty years, Switzerland has provided a highly favorable and minimally regulated environment for Russian wealth to flow into. With the onset of the war in Ukraine, Switzerland joined the EU in imposing sanctions designed to punish Russia for the invasion. The Swiss Bankers Association (SBA) announced in 2022 that Swiss banks hold between CHF150 billion and CHF200 billion ($160-$214 billion) in assets belonging to Russian clients.
Switzerland recently announced its 11th round of Russian sanctions, freezing an estimated CHF7.7 billion ($8.81 billion) in financial assets belonging to Russians. While only a provisional figure, it represents only a very slight increase from the CHF7.5 billion the Swiss government blocked last year when sanctions were initially adopted.
The Swiss-based NGO Public Eye’s investigation into 32 Russian oligarchs in 2022 found that this group used the Swiss system to create shell companies, exploit loopholes as well as discretely and legally keep profits out of Russia. For example, the Kogan family, led by Vladimir Kogan until his death in 2019, has made Switzerland their base since the early 2000s with their purchase of a chalet in Crans-Montana. The Kogan family’s entrenchment in Switzerland grew when Vladimir’s eldest son, then 24-year-old, Evgeny Kogan became the principal investor in the luxury mega real estate project, Aminona Luxury Resort, in 2013. Despite sinking CHF100 million into the project and buying over 50,000 m2 of land, work remains delayed to this day. Vladimir’s wife Lyudmila inherited his assets including an 82% stake in Uralsib, one of Russia’s largest banks, though Evgeny became the president and sits on Uralsib’s Board of Directors and Supervisory Board, directing the bank from his residences in Switzerland. The Pandora Papers revealed a range of offshore entites affiliated with the family ranging from the British Virgin Islands to Lichtenstein, as well as a web of Cypriot entities currently in operation. The Kogan family are but a few of the ultra-high net worth Russian individuals currently using Switzerland as a base.
While many billionaires evade Swiss sanctions, others have been caught up in international sanctions. Anna Tsivileva, the daughter of one of Vladimir Putin’s cousins, is a 70% owner of KSL, a reseller of Russian coal company Kolmar, evaded international sanctions until December 19, 2023. Switzerland is home to Kolmar’s trading subsidiary KSL AG (Kolmar Sales and Logistics), which was registered in 2016. While not sanctioned by the Swiss government, Tsivileva now faces EU and UK sanctions.
Public Eye’s investigation into the 32 oligarchs, many of whom physically reside in Switzerland, calls into question the efficacy of the Swiss sanctions in limiting Russia’s military ability and support for the government among the oligarchs to this day. Many of these Russian billionaires continue unsanctioned, not only from Swiss sanctions, but EU and American sanction lists as well. With the latest round of Swiss sanctions affecting only a very small portion of Russian assets in Switzerland, the overall effectiveness of these sanctions upon Russian oligarchs remains to be seen.
