President Vladimir Putin’s failure to turn up in Istanbul for peace talks with Ukraine’s President Volodymyr Zelenskyy has ratcheted up frustration in the Donald J. Trump administration over any agreement between Russia and Ukraine. Clearly, if a deal is to be arranged, much more intensive pressure needs to be exerted on the Kremlin.
In particular, the White House must lean more heavily on Russian oligarchs who promote the war and make frozen Russian assets available for Ukraine. While some oligarchs oppose the slaughter in Ukraine, others enthusiastically cheer for and fund it.
President Trump’s peace efforts have been most vehemently rejected by one prominent oligarch close to the Russian President, Vladimir Putin, Konstantin Malofeev. Malofeev has significant influence not only because of his vast assets, but also because he owns the television channel Tsargrad, one of the most aggressive instruments of Russia’s anti-American propaganda. Sanctions against him must be significantly tightened and extended to all his close associates.
Konstantin Malofeev by Lous Whinston. CC BY-SA 2.0.
Malofeeev is the leading promoter of Russia’s imperialist ideology, which is seeking to erase Ukrainian statehood and nationhood. He has been under Western sanctions since 2014 for facilitating Russia’s occupation of Ukrainian territory and financing paramilitary formations.
Malofeev is blacklisted in the US, the EU, and the UK. He was also indicted for violating U.S. sanctions after paying an American citizen to operate pro-Moscow television networks in Greece and Bulgaria.
The Office of Foreign Assets Control (OFAC), a financial intelligence agency in the U.S. Treasury Department, determined that Malofeev was one of the main sources of financing for pro-Kremlin militias in Ukraine and engaged in actions that threaten Ukraine’s security, sovereignty, and territorial integrity. Although Malofeev was prohibited from paying or receiving services from U.S. citizens from conducting transactions with his property in America, he has systematically flouted those restrictions and evaded international sanctions.
Washington issued a seizure warrant for Malofeev’s U.S. investment to confiscate $5.4 million following the Justice Department’s 2022 KleptoCapture initiative to seize the assets of Russian oligarchs funding the war against Ukraine. Malofeev is accused of moving millions of dollars through the global banking system with the help of a Cypriot accounting and offshore services firm, MeritServus, violating EU sanctions and Cypriot law.
He was also allegedly assisted by Alexey Komov, who played an essential role in schemes to evade U.S. sanctions and establish Russian TV networks abroad. The Tsargrad TV channel also broadcasts support for another Russian oligarch, Ruben Vardanyan, one of the richest people in Russia.
Vardanyan, in turn, is accused of engaging in money laundering through offshore companies, transferring money to influential people in Putin’s entourage, and subverting neighboring countries. Vardanyan held positions in the presidential “Expert Council”—a privilege only awarded to people who are close to Putin. Vardanyan also ran the investment bank Troika Dialog, which became a part of Russia’s state-owned Sberbank.
Malofeev’s continuing support for Vardanyan is part of a broader pattern of facilitating influence operations in neighboring countries to advance the Kremlin’s objectives. Vardanyan has campaigned against a peace treaty between Armenia and Azerbaijan and has actively supported the partition of Azerbaijan. He served briefly as State Minister in the disputed region of Karabakh when it was under Armenian control and was a vehement backer of local separatism. He also supported nationalist Armenian groups who opposed peace with Azerbaijan and challenged the Armenian government of Prime Minister Nikol Pashinyan, which seeks closer relations with the West.
When Azerbaijan reclaimed most of Karabakh after a brief war in the fall of 2020, and liberated the rest in 2023, Vardanyan was arrested by Azeri authorities and charged with terrorism, organizing and arming illegal militias, and waging an aggressive war. Malofeev has campaigned on Vardanyan’s behalf, framing him as a victim of Azerbaijan following his imprisonment.
Another close associate of both Malofeev and Vardanyan is Sergei Roldugin, an oligarch known as “the secret caretaker” of Putin’s wealth, who received more than $69 million from a multi-billion financial network operated by Vardanyan’s Troika Dialog. The network involves over 76 offshore firms through which billions of dollars have been passed.
In March 2019, members of the EU Parliament demanded an investigation into the activities of Vardanyan as the head of Troika Dialog and other offshore companies. The Organized Crime and Corruption Investigation Center (OCCRP) convincingly proved that Troika Dialog had created an extensive network of offshore companies laundering and illegally withdrawing funds from Russia.
Malofeev is also a major benefactor of the Russian Orthodox Church, a primary promoter of the annihilation of Ukraine. The Church’s theory of the “Russian World” nurtures Russian hatred toward Ukrainians, and its expansionist messianic agenda is a direct threat to other neighbors in Eastern Europe and the South Caucasus. If the war against Ukraine and the subversion of other nearby states are to be ended, one imperative is to undercut the financing of military and propaganda operations by key Russian oligarchs.
Alongside the application of more intense pressure on Kremlin-linked oligarchs, the long debate over frozen Russian assets should be finally resolved by seizure and payment for Ukraine’s reconstruction and military assistance. Of the estimated $300 billion of assets held in Western financial institutions, about 90% are in EU states, while the U.S. holds around $5 billion.
Neither the U.S. nor the EU has thus far agreed on seizing the frozen reserves outright, while the Trump administration has failed to articulate a clear policy on Russian assets. Washington and Brussels need to follow Japan’s lead. It signed an agreement with Ukraine in April to lend Kyiv over $3 billion for reconstruction, backed by the proceeds from frozen Russian assets.
Such a forceful approach was vehemently condemned by Moscow, fearful that it would serve as a potential precedent for the U.S. and the EU. If Trump is serious about applying economic pressure on Putin to forge a peace deal with Ukraine, targeting Kremlin assets and oligarchs will certainly get his attention.
Janusz Bugajski is a Senior Fellow at the Jamestown Foundation in Washington DC and author of two new books: Pivotal Poland: Europe’s Rising Power and Failed State: A Guide to Russia’s Rupture.
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