Russian media is not taking kindly to the suggestion that Moscow could have been behind last week’s leak revealing hundreds of thousands of offshore accounts being maintained by global political leaders.
“The Western media is now suggesting that [Russian President Vladimir] Putin has orchestrated it all … exactly because his alleged involvement in offshore schemes is not mentioned in the docs,” state-backed Russia Today said in an unsigned Monday editorial about the so-called Panama Papers.
Saying the theory had been “propagated … by some Western media outlets,” the publication cited a Washington Post report on Clifford Gaddy, a senior fellow at the Brookings Institution and a former adviser to the Russian Finance Ministry. Specifically, Gaddy posited last week, a breach of Panamanian law firm Mossack Fonseca could have been backed by the Russian government as “a weapon for blackmail.”
“I suggest that the purpose of the Panama Papers operation may be this: It is a message directed at the Americans and other Western political leaders who could be mentioned but are not,” Gaddy said. “The message is: ‘We have information on your financial misdeeds, too. You know we do. We can keep them secret if you work with us.’ ”
Related Story: http://www.washingtonexaminer.com/article/2588011
The theory runs contrary to a general sentiment since the scandal broke that the documents disproportionately cast Russia in a negative light. That argument still has merit: Of about 14,000 clients included in the papers, only about 200 Americans have been uncovered to date. On the other hand, $2 billion in offshore transactions have been traced to Russians, some of whom are linked to Putin.
Putin last week also accused Western powers of originating the leak, saying they were trying to “destabilize” Russia “from within in order to make us more compliant.” That accusation even led to a public denial from the State Department during a recent press briefing.
Yet in spite of the sizable pool of funds traced to Russia, Gaddy believes, it is insignificant in terms of the suspected scale of activity in that country.
“We in the West have cried ‘Wolf!’ so often and so loud by now [regarding] Putin’s corruption, extent of personal wealth, and so on, that anything that anyone now says seems anticlimactic,” Gaddy said in email to the Washington Examiner. “I think he is more or less immune to further reputational damage in the court of public opinion.”
To some extent, that reality has been on display since the scandal began. The prime minister of Iceland was forced to resign his position within 48 hours of news breaking that he held shares in an offshore company called Wintris, while U.K. Prime Minister David Cameron has been battling to maintain his own status in that country after revelations that he earned around $40,000 through another offshore arrangement months before assuming office.
Putin, whose net worth is rumored to run as high as $200 billion, remains unscathed in the court of Russian public opinion. For that reason, Gaddy argues, mishandled funds traced to that country, even to its state-backed Sberbank, are inconsequential, as are any ties to Putin’s associates.
Gaddy believes only two events could pose a significant challenge to Putin’s status. “First, and obviously, if information were to emerge that proved — not merely suggested — some criminal liability on his part, that would be damaging.” However, he added, “I doubt that will happen.
Clifford Gaddy of @BrookingsInst trolls the Kremlin. The Panama Papers were a Russian plot against the West! https://t.co/P9M29sTYnU
— Brian Whitmore (@PowerVertical) April 8, 2016
“A more immediate and serious threat would be information that caused financial authorities worldwide to actually block the flows of Russian funds from the circles close to Putin, even if Putin were not directly liable,” Gaddy said. “But this is not so much a question of the nature and amount of information as it is the political will of authorities to act on the information.”
Although only those two events could diminish the stature of the Russian leader, it could take less to annoy Moscow. In one Friday tweet, Russian analyst Brian Whitmore accused Gaddy of “trolling” the already agitated Kremlin. Monday’s editorial in Russia Today seemed to affirm that, quoting Whitmore’s tweet and adding criticism from political cartoonist Ted Rall.
“There is a great desire on the part of many in the U.S. and Western media to try to catch President Putin doing something wrong,” Rall said, who added that those entities are “working backwards in order to [make] evidence fit those conclusions.”
