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From astronomical sums of money to opulent superyachts and lavish villas, the assets of the oligarchs providing the political and financial backing for Russian president Vladimir Putin’s military ambitions have been publicly and fervently seized by Western nations since Russia’s invasion of Ukraine.

Yet the invasion—now in its second year—remains largely unabated as Russia’s moneyed elite challenge sanctions in court or simply dodge them.

But a new study led by �����鶹 researchers exposes a massive vulnerability for the Kremlin’s critical cadre of billionaires—the small, secretive network of financial experts who manage their wealth. , the paper uses network science based on leaked documents to test the findings of an immersive sociological study of the offshore wealth managers who protect billionaires’ fortunes. The results show that sanctions targeting these experts would wreak far greater damage than sanctioning oligarchs one by one.

“Rather than playing whack-a-mole with each individual oligarch, you take out one wealth manager and you effectively take out several oligarchs in one fell swoop,” says co-author , a professor of sociology at �����鶹 who initiated the study after spending a total of eight years training as a private wealth manager and traveling to tax havens to observe the craft in action.

The researchers mapped the connections between more than 1.9 million wealth managers and their clients from Russia, China, the United States, and Hong Kong, as well as the more than 3.2 million network ties linking them. They relied on the Offshore Leaks Database maintained by the International Consortium of Investigative Journalists, which identifies wealth management professionals and ultra-rich individuals revealed through high-profile information leaks such as the 2016 Panama Papers, the 2017 Paradise Papers, and the 2021 Pandora Papers.

Mathematical “knockout experiments” revealed that these financial networks can be disrupted to the point of collapse by disabling a few key players, the researchers reported. They also found that wealthy individuals from autocratic nations such as Russia tend to rely on fewer managers with smaller client lists to ensure secrecy.

Combined with the concentration of those wealth managers in the United Kingdom and European Union, this makes Russian oligarchs’ offshore wealth particularly vulnerable to sanctions that target financial experts, the study found.

“Awareness of wealth managers and what they do is still in its infancy in terms of public policy. To end the invasion, there’s an urgent need for sanctions informed by systematic evidence of the asset structure supporting Russia’s campaign—our paper provides that evidence,” Harrington says.

“To use a military analogy, we are providing a financial missile-guidance system for the countries trying to stop the war in Ukraine,” she says. “A more targeted use of state-backed sanctions means a shorter war and less loss of life.”

First author Ho-Chun Herbert Chang ’18, a PhD candidate at the University of Southern California, says that the unique combination of network science with sociology provided a practical map of the relationships between the wealthy and the people who shepherd their assets—one that can be used to enact policy. Chang  as an assistant professor of quantitative social science in fall 2023.

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A network of nearly 80,000 financial experts (yellow) and clients shows wealth concentrated in a few managers. Russian clients are in red. (Photo by Herbert Chang)

“The combination of ethnographic work and data science generated results that are grounded and precise while still telling a compelling human story,” says Chang, who carried out the calculations and data visualizations. Co-authors and �����鶹 professors , an associate professor of mathematics and Chang’s former adviser, and , professor of math and computer science, provided the theoretical background and designs for the numerical experiments.

“Our methodology puts equal weight on empirical rigor, pragmatic intervention, and theoretical insight to understand collective human behavior,” Chang says. “This allows us to be extremely precise about who and what we can target. We can even estimate the impact of specific sanctions and are developing metrics to identify new targets.”

The study in PNAS Nexus serves as a first step toward what the authors hope is a new field of study they call “the complex systems of secrecy” that seeks to understand shadowy webs of power, wealth, and corruption.

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Ho-Chun Herbert Chang ’18 and Brooke Harrington, professor of sociology. 

“Complexity contributes strategically to secrecy. That goes double for highly secretive activities such as offshore wealth management where there was essentially no data to be had unless someone leaked it,” Harrington says. “Now that ‘Big Data’ are available on networks usually shrouded in secrecy, we can examine them properly and better understand them as a scientific phenomenon that we expect is far larger in scope and applies to many different domains of life.”

The study in PNAS Nexus demonstrates how collaborations between network scientists and social scientists are essential for extracting the structure of these nebulous systems from reams of data, then applying the findings in ways that effect change, Rockmore says.

“The study of sociological phenomena and social networks was in many ways the origin point of modern network science,” he says. “Our work follows that theme but extends it to the secret wealth networks of offshore asset management. If the problem can be described in terms of relationships, then network science can be brought to bear.”