As Azerbaijan and Armenia approach a peace settlement, it has become more vital for the U.S. that talks do not stall.
Previously the negotiations fell apart, following Azerbaijan’s military victories and Russia's machinations. Trade relations, such as establishing connections between Armenia, Türkiye, and Azerbaijan via the proposed "Peace Corridor," depend on a lasting peace.
However, Russia would rather not see trade routes which can serve as alternatives to its transport corridors to the interior of Eurasia succeed.
This has prompted sustained attempts to disrupt negotiations in the region.
Russian billionaire Ruben Vardanyan plays a key and sinister role in these efforts.
A Russian-backed oligarch with deep ties to Putin’s inner circle elite, Vardanyan was strategically placed into the complex ethnic conflict by the Kremlin in 2021 to prolong instability for Russia’s benefit after the Azerbaijani victory against Armenia in 2020.
During the 2023 fighting finale over the long-disputed enclave of Nagorno-Karabakh, he was detained by the Azerbaijani forces as the leader of that unrecognized self-proclaimed Karabakh.
Since then, his supporters have continued to demand his release, including a sustained social media campaign, working with global organizations like the Red Cross and even arranging for him to be nominated in 2024 for a Nobel Peace Prize.
The "Free Vardanyan" campaign is a carefully crafted narrative that positions his imprisonment as a humanitarian issue, and paints Vardanyan as a new Nelson Mandela.
Except Ruben Vardanyan is not a political prisoner at all.
Ethnically Armenian, Vardanyan lived in Moscow for decades before gaining Armenian citizenship in 2021.
During the first Nagorno-Karabakh War in the early 1990s, Vardanyan remained silent, amassing wealth through his connections and dubious activities.
His Moscow years were well spent cultivating relationships with Russia’s ruling elite.
Dubbed "Putin’s Wallet" by Russian opposition figures, Vardanyan was a part of the Russian financial system’s opaque dealings.
His investment bank, Troika Dialog, was allegedly implicated in laundering billions through offshores.
Reports from Bloomberg and the Organized Crime and Corruption Reporting Project (OCCRP) linked him to alleged money-laundering schemes benefiting Putin’s inner circle, particularly Sergey Roldugin, a cellist and an operative.
The leaks revealed a web of offshore transactions through Mossack Fonseca totaling $2 billion.
Vardanyan held positions in the Russian government that required Putin’s direct approval: he was an officially appointed expert adviser in the Presidential administration and the Cabinet Special Council.
In 2019, European Union lawmakers called for Vardanyan to be placed under sanctions in connection with his practices as a top banker with the Troika investment bank "Laundromat." He was then included in the 2022 list of draft sanctions drawn up in the U.S. Congress as part of H.R. 6422, the Putin Accountability Act.
The South Caucasus, particularly the Nagorno-Karabakh region, occupied by Armenia, has long been a powder keg of ethnic and geopolitical tensions.
The collapse of the USSR led to the first war, which Armenia won with Russian support, forcing over 800.000 Azerbaijanis to flee. The war left Azerbaijan with roughly 10% of its population of internally displaced persons.
For Moscow, this conflict was a useful geopolitical tool.
By maintaining instability, Russia justified the presence of its peacekeepers and secured leverage over both Armenia and Azerbaijan. However, Azerbaijan’s decisive military victory in 2020 upended these arrangements.
The ceasefire agreement included a roadmap for Nagorno-Karabakh’s reintegration into Azerbaijan, threatening to diminish Russia’s influence in the region.
It was against this backdrop that Vardanyan relocated to Armenia in 2021, publicly disavowing political ambitions.
But soon the billionaire floated the idea of running for president before ultimately positioning himself as Nagorno-Karabakh’s de facto leader.
His brief tenure suggests a deliberate effort by Russia to obstruct Azerbaijan’s reintegration plans, using his financial clout to sow discord in Armenian politics.
But Vardanyan’s actions only accelerated Azerbaijan’s final push. Baku launched a rapid military operation in September 2023, securing full control over Karabakh.
Vardanyan was arrested by Azeri authorities and charged with terrorism alongside other offenses: supplying illegal armed groups with weapons; waging an aggressive war; and deporting or forcibly displacing the population. This marked a significant loss of influence for the Kremlin, compounded by Armenia turning closer to the West and Russian peacekeepers exiting Nagorno-Karabakh.
Initially launching a hunger strike to protest his captivity in Azerbaijan, Vardanyan was allowed to communicate with his family and ended the protest.
He's currently being tried in Azerbaijani court along with other separatist leaders of the enclave. The Russian Foreign Ministry issued negative commentary on the proceedings. Should he be freed, Vardanyan possesses the wealth and connections to reestablish himself and could serve as Moscow's instrument to destabilize Armenia and block her pivot toward the West.
Vardanyan’s arrest signals a shift in the post-Soviet geopolitical landscape.
For Ukraine, Georgia, and Moldova, Vardanyan’s story is instructive. Just as Baku reclaimed Nagorno-Karabakh despite Moscow’s designs, Kyiv, Tbilisi, and Chișinău could apply similar tactics to reintegrate the occupied regions.
The demise of Russia’s influence in Armenia and Azerbaijan undermines its broader strategy of using ethnic separatist agents with deep pockets to maintain its sphere of influence.
Mike Flanagan represented the 5th District of Illinois in the U.S. House of Representatives. For More of his Meports — Click Here Now.
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