Thursday, December 15

Putin the Clever vs Mordor: the war moves to the banking sector

A big thanks to Riehl World View and The Steel Deal for catching this United Press International story:
NOVOSIBIRSK, Russia, (UPI) -- December 14 -- Russia's president said Wednesday he wants foreign banks "essentially banned" from his country, Itar-Tass reported. [...]

"This is connected not only with competition, including the impossibility to trace the movement of money and capital in the modern world," said Putin. "This is connected among other things with the need to fight terrorism. We must not forget this. And this is connected with the need to fight money laundering."[...]
Readers who have been with Pundita since the early days know that I warned almost a year ago that this sort of move was coming once the Kremlin wrestled control of Russia's oil away from Russia's oligarchs.

Is Putin serious about severely limiting foreign banking in Russia? Well, I think he's very serious about getting more cooperation from US, West European and Israeli banks in coughing up billions in owed back taxes that Russian oligarchs have stashed in those banks. I also think he's sending a clear message to Russia's business community that the Rape of Russia is over.

While the Russian oligarchs ran the show they sure didn't do their big banking at Russian banks; they banked the big profits at US, Israeli and West European banks. So not only did the oligarchs rob the Russian taxpayers and government blind, they did not put enough Russian oil profits into the Russian banking system and thus into the Russian economy to help it stay solvent. Sort of like beating up someone after robbing him.

That's not even speaking to Israeli banks refusing to cooperate with the Russian government's attempts to get back the billions in back taxes owed to Russia that oligarchs and Russian mobsters bunkered in Israel stashed there.

11:00 AM Update
See Putin the Clever vs Mordor: the war moves to the banking sector for my analysis of Putin's latest move in what I only half-jokingly referred to earlier this year as "World War V." Thanks again to Riehl World View and Steel Deal for catching the UPI article!

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