Why so many Russian billionaires are called oligarchs

Many of the sanctions the United States and the European Union have imposed on Russia are meant to target some of the country's wealthiest individuals who have ties to Russian President Vladimir Putin.

Yachts, sports teams, newspapers and luxury real estate are just some of the assets owned by these billionaires. Those assets and more will be the focus of President Biden's new KleptoCapture task force that he announced during his State of the Union speech.

"I say to the Russian oligarchs and corrupt leaders who have bilked billions of dollars off this violent regime, 'no more,' " Biden said.

"We are joining with our European allies to find and seize your yachts, your luxury apartments, your private jets. We are coming for your ill-begotten gains."

But what's the difference between a "normal" billionaire and a Russian "oligarch"?

In Russia, the oligarch title goes back to the early 1990s when the Soviet Union dissolved. Because the USSR was founded on communist principles, all means of production from oil to electricity to farming was state-owned.

When the Soviet Union fell, a corrupt, sometimes violent scramble ensued to take ownership of the country's industrial infrastructure. Some of those who were vying for control took it by any means necessary.

As a result of their new business ownership, these individuals amassed significant wealth and ended up with the power necessary to manipulate the government alongside Boris Yeltsin, who became Russia's president in 1991.

They constituted an oligarchy, a system of government in which a small group of people is in charge — oligarchs.

By the time Putin began his presidency in 2000, the government — run in part by the oligarchs — was highly dysfunctional. Putin went to work centralizing his authority and moving the oligarchs out of politics.

Some of them fled the country. Others were exiled, imprisoned or had their property seized. Those who remained largely agreed to stay out of politics and leave that to Putin. Others acquired citizenship in other countries and invested their wealth in the West.

When the U.S. announced sanctions in response to Russia's invasion of Ukraine, the Treasury Department released a list of the companies and individuals who are being targeted. Today's Russian oligarchs — at home and abroad — may no longer be in charge of the government, and "oligarch" is now something of a misnomer. But they certainly have benefited from the state's largesse.

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