The Waning of Russian Power in the South Caucasus

Once Moscow’s proxy, Ruben Vardanyan posed as a peacemaker while fuelling conflict. His fall marks the collapse of Russia’s grip on the South Caucasus.

As Armenia and Azerbaijan inch toward a peace agreement¹, the once-formidable shadow of Moscow over the South Caucasus is fading. For Washington, ensuring the momentum of negotiations is no longer a matter of diplomacy alone, it’s about preventing a return to war.

For years, Russia exploited the region’s ethnic strife to assert influence. After Azerbaijan’s military reclaimed much of Nagorno-Karabakh in 2020, the Kremlin shifted tactics. Rather than send more troops, it deployed capital and one man.

The Kremlin’s Agent

Ruben Vardanyan, a Russian-Armenian billionaire with close ties to Vladimir Putin’s inner circle, appeared in Nagorno-Karabakh in 2021. He claimed a personal mission of peace. In reality, his presence prolonged conflict.

Vardanyan had spent decades in Moscow, amassing wealth through the murky corridors of Russian finance. His investment bank, Troika Dialog², was at the centre of a sprawling offshore laundering operation known as the "Troika Laundromat." Investigations by Bloo…