Billion-Dollar Russian Fund With US And EU Advisers Shows Dilemma Facing Sanctions Expansion

[Purveyor]

Associated Press Aug. 29, 2014 | 5:21 p.m. EDT
By JEFF HORWITZ and STEPHEN BRAUN, Associated Press

WASHINGTON (AP) — Western business connections are complicating efforts to bring economic sanctions against executives and companies closely aligned with Russian President Vladimir Putin's inner circle. A prime example: the Russian Direct Investment Fund, a $10 billion sovereign wealth fund that's escaped sanctions in spite of international efforts to punish Russia for its incursions in Ukraine.

A sanctioned Russian bank funds the RDIF, and a top Putin aide serves on one of its board. The fund's international advisory board, meanwhile, is stocked with blue-chip American and European private equity executives, among them Stephen Schwarzman of The Blackstone Group LP, Leon Black of Apollo Global Management LLC and David Bonderman of TPG Capital LP.

The chief executive of a French state-controlled investment company, Caisses de Depots, is listed as one of its supervisors — as is former International Monetary Fund head Dominique Strauss-Kahn.

The fund has done deals with BlackRock Inc. and General Electric Co., which partnered with the fund to build small power plants for industrial users across Russia. JPMorgan Chase & Co.'s One Equity Partners joined an Illinois tire company to buy a manufacturer of agricultural and industrial tires. European investors took stakes in telecommunications firms, information technology consultants and health care companies. In total, more than $6 billion from blue-chip foreign companies have flowed in.

President Barack Obama and German Chancellor Angela Merkel are considering new economic sanctions against Russia over its apparent invasion of Ukraine. There is no evidence that the Russian Direct Investment Fund would be a target, but the situation with the sanctions-free RDIF illustrates the Obama administration's struggle to achieve conflicting goals — punishing Putin's circle without damaging U.S. companies doing business in Russia.

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http://www.usnews.com/news/business/articles/2014/08/29/russian-fund-with-us-advisers-eludes-sanctions

[Wellstone ruled]

1. Been looking for this article.

Thanks for the post. Everyone must read this,the real story. Like I said early today about the facts and dealing with the so called Russian Government,it's Putin's Mafia,and,when they decide to stop killing the Innocent,then and only then will this bullshit will come to a stop. It's all about the Oil and Gas and the domination of Energy supplies and Empire Wealth. Russia has the worlds 4th largest proven reserves,we.in turn,only 8th,depending on study,or 14th proven reserves. We are the largest users of refined energy supplies. Photo Op Coming in due time.