As the war in Ukraine drags on, the international community continues to seek out creative measures that can assist in putting an end, once and for all, to the war which has dragged on far longer than anybody anticipated. With the General Assembly holding its annual meeting in New York, where world leaders convene to discuss the most important issues on top of everyone’s agendas, undoubtedly the question of how to effectively stop Russia dead in its tracks will feature high on everyone’s minds. Closer cooperation, along with creative ideas are the only way to have any substantial impact on an issue which has befuddled world leaders for over two years now.
Since Moscow invaded Ukraine, going so far as to even bombard the capital city Kiev in some of the most horrific attacks seen since the last World War, public and private conversations have been had on how Moscow manages to successfully continue funding its vast war effort, despite enumerable sanctions package imposed by NATO and its allies. For reference, studies conducted at the start of the war estimated the daily cost (direct and indirect) to stand at over USD 20 billion, including the impact on the Russian economy, as well as of course, direct military costs. When pushed into a corner, and electing to continue to fight, the creativity which Moscow has displayed has shocked many, employing any and all tactics in order to circumvent global sanctions mechanisms.
A recent case which has come to be known as the case of Putin’s Trader is representative of the extremities of such efforts. The story is of the now well-known Vladislav Klyushin, who worked for the office of Russian President Vladimir Putin, and who, over the course of many years managed to take advantage of American capital markets through an information technology company which he owned. The scheme was an elaborate one, but in short through his company, M-13, which played a role in preparing annual financial statements for leading American companies, he had access to the electronic filings of almost every top tier publicly traded company in the United States. Placed in his position by the Kremlin, Klyushin wood provide traders associated with the government in Russia the information needed to make a tremendous amount of money on the basis of insiders’ information which he provided, according to some almost 100 million dollars. Released in a recent global prisoner exchange, more details about this case continued to come to light, but exhibit the creative mechanisms which the Kremlin employs to continue funding their war efforts.
A very different but equally appalling case is that of Dutch citizen and Swiss resident, Niels Troost who himself made a fortune trading Russian commodities that had been sanctioned. Seeing an opportunity, or perhaps working at the behest of Russian connections, Niels Troost used a subsidiary based in the United Arab Emirates, Paramount DMCC, to circumvent sanctions mechanisms, acquiring below market value Russian commodities and selling these around the world. As with Klyushin, Niels Troost was eventually caught, although he naturally denies any responsibility and claims the company which traded the sanctioned commodities had nothing to do with him or his company directly, despite holding the same name. And while Niels Troost was himself not arrested, he found himself sanctioned along with his business partner Francois Edouard Mauron, in the United Kingdom.
Cases such as these allow Moscow to continue making the money needed to carry on with its war, while the world watches from the General Assembly in New York and looks for ways to keep up with the myriad of tricks in Moscow’s book. Staying one step ahead of the game is imperative when dealing with an adversary willing to resort to almost anything to stay afloat. It’s far more than Ukraine which is at stake at the moment. Rather, it’s the peace and security afforded by much needed respect for international rule of law, which once upended knows no bounds.
