In Russia, there are fewer and fewer untouchables!
On July 2, Russian sources reported that Konstantin Makhov – the “right-hand man” of Arkady Rotenberg, one of the billionaires closest to Putin – had been detained in Moscow.
Arkady Rotenberg, 74, is Putin’s childhood friend and former judo partner. After Putin came to power, the businessman made his fortune from major government contracts. Since the start of Russia’s full-scale war against Ukraine, Rotenberg has become the main beneficiary of the wave of nationalization of private businesses.
Today, Rotenberg is considered one of Russia’s wealthiest and most influential businessmen. According to Forbes, his net worth is estimated at $5.5 billion.
Makhov is not just “Rotenberg’s manager.” He is the man at the center of the entire corporate structure surrounding the largest construction project in Russia’s gas and petrochemical industry – the Ust-Luga Ethane-Containing Gas Processing Complex.
Makhov is CEO of RusGazDobycha, the Baltic Chemical Complex, and the National Gas Group, as well as chairman of the board of RusKhimAlliance.
The Ust-Luga Ethane-Containing Gas Processing Complex is what Gazprom has left instead of the European market: 45 billion cubic meters of gas processing capacity per year, 13 million tons of LNG, and up to 2.8 million tons of polyethylene.
According to the investment project plan approved by the Russian government in January 2024, the total cost is 4.9 trillion rubles (~ $63.45 billion). Of that amount, 900 billion rubles (~ $11.67 billion) comes directly from the National Wealth Fund at 6% annual interest.
As a reminder, the Central Bank’s key interest rate at the time was 16%. That is, Russia’s sovereign wealth fund is lending money to a project linked to the Rotenberg circle at a quarter of the market rate of interest.
Makhov’s detention may therefore concern control over the largest state financial resource available to the real sector at a time when budget reserves are shrinking and the National Wealth Fund continues to dwindle.
We can ponder what this detention means.
The first theory is that it is a signal to Rotenberg. There are rumors that Arkady Rotenberg has allegedly lost direct access to Putin and unsuccessfully tried to restore contact through Ilham Rahimov.
Under this logic, detaining his closest manager is a classic tactic of the system: when dissatisfied with a patron, they target someone from his inner circle.
The second version is pressure on the management of the cluster itself. This version is supported by documented evidence: in March 2025, the Prosecutor General’s Office filed a lawsuit to forfeit the assets belonging to Kirill Seleznev, CEO of RusKhimAlliance and a former member of Gazprom’s management board.
If Makhov has now also been detained, then within a year and a half the security services have targeted both top figures of the same project. This looks like an internal struggle within the system for control over the flow of state funds.
If this is a case against Makhov personally, it will remain narrow: incidents from 2021-2023, Article 159 or 160, fraud or embezzlement involving contracts. He will quietly be removed from his positions, and no one will touch Rotenberg’s business structures.
But if Rotenberg is the target, the case will begin to expand beyond Ust-Luga and reach Russian Railways contractors and the construction legacy of Mostotrest, and more people from the orbit could be detained.
What the Makhov case shows most clearly is that the spiders in the jar have begun to devour one another.
When external rents shrink – and it is shrinking – the internal struggle over what remains intensifies. There are no untouchables. There are only those whose turn has not yet come.
Compromising material on everyone has been collected in advance and is waiting for a political order. Loyalty to Putin offers no protection, because only usefulness offers protection – and in a shrinking system, usefulness is a variable concept.
But the war requires more and more money, which means that even members of Putin’s inner circle are now at risk of having their wealth seized.
— @Gerashchenko_en Jul 4, 2026
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