Even a Putin Couldn't Launder Russia's Seediest Bank

Close ties to President Vladimir Putin's family are apparently no guarantee of immunity in today's Russia. A big bank where Putin's cousin served on the board of directors was closed on Nov. 20, amid a large-scale police operation that tied it and a number of other Russian banks to money laundering and illegal capital flight.

Master Bank was only the 68th largest bank in Russia by assets, but it was a top-5 ATM operator and plastic card issuer. It also held about $1 billion in individual deposits. On Nov. 20, central bank Chairman Elvira Nabiullina declared that Master Bank had negative capital of about $61 million and that it had been "involved in shadow activities." The central bank lifted its license just as the police and counterintelligence service were conducting simultaneous searches in 34 banks and financial companies throughout Moscow. The massive bust capped an almost year-long investigation into a money-laundering network that involved hundreds of firms and several immigrant diasporas.