Last but not least, the United States, the UK, and other Western countries need to garner the political will to close loopholes for tax evasion and anti-money laundering mechanisms. In the United States, for example, the richest 1 percent of Americans have been able to hide more than 20 percent of their income using opaque ownership structures and complex trusts, especially in the real estate sector and offshore businesses. These are the same loopholes that once made Western real estate markets and tax haven jurisdictions hospitable to Russian oligarchs’ investments. Increasing the transparency of assets’ ownership and financial transactions and spreading the application of the anti-money-laundering rules to the real estate and offshore sectors will likely meet domestic resistance. Indeed, these same rules, which attracted Russian “dirty money,” are benefiting wealthy business people, celebrities, and politicians in the West.

Dr. Mariya Y. Omelicheva is a Professor of Strategy at the National War College, National Defense University.

Alexander Sukharenko is the Director of New Challenges & Threat Study Center in Vladivostok, Russia.

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