Echo of Scandal of the Year: Money for Boiko Oil Rig were paid into “Personal” Bank
Purchase of a drilling platform by the state company “Naftogaz” from a firm, created by swindlers from Riga, became a major corruption scam of the year. Details of this story are familiar to Ukrainians. Naftogaz subsidiary “ChornomorNaftoGaz” purchased a drilling platform made in Singapore from a supposedly British firm Highway Investment Processing LLP.
Investigation by the newspaper “Mirror Weekly” revealed that the Ukrainian state owned company paid $400 million dollars for a drilling platform worth only $250 million dollars. Further investigation by the TV channel “TVi” found a nominal director of Highway Investment – a Riga resident Stan Gorin, who informed that he had nothing to do with this company and he did not sign the transaction documents as to the platform.
Highway Investment Processing LLP was founded by two offshore companies. According to the audit, ordered by the Azarov’s Government, their directors are the mentioned above Stan Gorin and Riga resident Eric Vanahels, who turned out to be homeless and whose passport was lost.
Thus, the oil rig purchase was a corrupt scheme, intended to launder money through “shell” companies. One detail of this scheme has drawn our attention and nobody has noticed it before.
Requisites of the “shell” British company Highway Investment Processing LLP caught our eye. The choice of a bank by this company seemed suspicious. Despite the British origination, with headquarters in Cardiff, it ordered transfer of the sale proceeds not to Wales, but to the account of a “shell” company in Latvian Trasta Komercbanka.
It looks strange – if the company is British, why is money transferred through Latvia? “Ukrainska Pravda” found logic in such apparent disconnect.
It came out that this bank is linked to the political business group, which informal leaders are Sergiy Lyovochkin and Dmytro Firtash.
Austrian Harbour of “RosUkrEnergo” Group
Several months ago Austrian media published an article about life style of Dmytro Firstash and about his companies, based in Austria.
In particular, it was mentioned how one Austrian parliamentarian from Green Party always had arguments with Firtash drivers. Then, once, somebody punched her bicycle tire.
Austria is one of the favorite places to register business of Ukrainian elite. For example, Yanukovich, Azarov, Klyuev used Austria for their business purposes. This country has quite liberal tax laws for companies that do business elsewhere.
Unlike regular offshore jurisdictions, Austria is more respectable.
At the end, the choice of this country was not in Firtash favor. Austria provides for a wide access to public information. Very often, data, that should be confidential from a Ukrainian businessmen perspective, is in fact accessible for public through special registers.
Money laundering conspirators did not expect us to find information that we actually found.
Here’s how the story goes. Vienna is the registration place for Cenragas, that is known to Ukrainian readers due to its 50% ownership in the phantom gas broker company “RosUkrEnergo”.
The end beneficiaries for Centragas are citizens of Ukraine Dmytro Firstash & Ivan Fursin.
“Ukrainska Pravda” obtained Austrian reports of Centragas. Among members of the Supervisory Board we found one person of interest – British citizen by the name Charles Edward Treherne. As of March, 2011 he was the deputy president of the Supervisory Board of this Austrian company of Firtash.
Here are the documents that evidence affiliation of Mr.Treherne with the Centragas company, which is a parent company of the Ukrainian part in “RosUkrEnergo”.
The document above is an addendum to the Cenragas report of March 18, 2011, signed by three board members – Dmytro Firtash, David Brown & Howard Wilson. This report contains information about members of the Supervisory Board. One of those members is Charles Treherne.
At the same time Mr. Treherne is mentioned … among owners of the Latvian bank Trasta Komercbanka, that received $400 million for the oil rig.
Until recently Mr. Treherne was a member of the bank’s Supervisory Board, now he is an advisor to the bank’s President. Apparently, he has been associated with this bank for a long time.
Therefore, the same person was hired to the Centragas Supervisory Board by RosUkrEnergo owners and, at the same time, he came out to be a co-owner of the bank that received money for the drilling platform.
To add to this mosaic, it is enough to mention that the purchase of the oil rig was under patronage of the Minister of Energy and Coal Industry Yuriy Boiko, one more representative of the informal group of Lyovochkin- Firtash.
Lyovochkin & Fursin – business partners or just friends?
While Dmytro Firtash, who owned 90% of Centragas and, accordingly, 45% of RosUkrEnergo is more or less known to public. Ivan Fursin, who owned 10% of Centragas and 5% of RosUkrEnergo is a mystery figure for lay Ukrainians.
In fact, informally, Fursin is a trusted friend of the chief of the Presidential Administration Sergiy Lyovochkin. In political and business circles people take them as an entirety.
Their friendship goes back to 1990s, when Fursin and Lyovochkin were working for a financial institution “Bankirskiy Dim”.
Lyovochkin differs from other players by his cautiousness – he covers his bases very well and it is almost impossible to trace his business connections.
On surface, contacts between Lyovochkin and Fursin are evidenced by the fact that the Lyovochkin’s sister Yulia was working under Fursin at “Misto-Bank” during the years 2003-2007. She was a deputy chief of an investment section there.
And so what? – you may ask. The fact that the member of the Supevisory Board of Centagas Mr. Treherne came out to be a shareholder of Trasta Komercbanka is not the evidence of integration of Mr. Treherne into the informal group Lyovochkin-Firtash.
We went further and found additional links between those individuals. We learned that the same Mr. Treherne had an offshore company with Ivan Fursin at Cyprus – Arcadea Investment Fund Ltd.
The third partner at that business was a Cyprus citizen Mr. Constantinos Constaninou. Now, he is a director of the Cyprus branch of Trasta Komercbanka.
An investment advisor of this offshore company was another British Robert Shetler-Jones, a member of the Supervisory Board of Centragas and a managing director of the main Firtash company – Group DF.
In general, Trasta Komercbanka is a joint business of the Latvian citizen Igor Buimisters and a group of unannounced individuals, most likely Ukrainian beneficiaries of RosUkrEnergo, in which their shares are split about 50/50.
Mr. Buimisters owns 43% of shares, Mr. Treherne – 9,31%. The remaining shares are split between companies from Latvia, Netherlands, Luxembourg and Cyprus with unclear ownership.
The end beneficiaries of those companies are unknown. Only one company from Netherlands GCK Holdings Netherlands B.V., which owns 7,4% of the bank shares, showed as its shareholder a Latvian company Dzintara Mezs.
It is peculiar that a Luxembourg company Rikam S.A.H (owns 7,3% of bank shares) has as its administrator a former volleyball player Myriam Deraideux, who occupies same positions at other Luxembourg companies, registered at the same address.
Another administrator of the Luxembourg company Algard von Ketelhodt is working for a firm that registers foreign companies to minimize business taxes.
Here we are talking about typical offshore companies to disguise actual owners of Trasta Komercbanka.
Without the link through Charles Treherne, RosUkrEnergo could be considered successful in thoroughly hiding its tracks in Trasta Komercbanka.
“Personal” Bank as a Part of Chain
What can you tell, looking at the list of shareholders in Trasta Komercbanka – at those Luxembourg, Netherlands & Cyprus companies? At the least that somebody tries to disguise actual shareholders of the bank.
But it is not the point.
In the European Union banking is strictly regulated as to money laundering. One cannot transfer $400 million to a reputable bank on account of a “shell” British company. Such bank may question such transaction to avoid problems in the future from national and EU regulatory bodies.
Existence of a “personal” bank simplifies process of money laundering by scheme operators. It is safe to transit money through own bank, because own managers will not pay attention to the account that was open by the company of homeless. Nobody will ask questions at the “personal” bank about source of money and where they went. And, hopefully, the Central Bank audit will not find something that does not need to be found.
15 years ago a former Prime Minister Pavlo Lazarenko understood that having a personal bank is very important for money legalization. He purchased a financial institution on Antigua, through which later he transferred hundreds million of dollars.
But in comparison with business activities of modern politicians and amounts of money involved, Pavlo Lazarenko looks like a child.
P.S. “Ukrainska Pravda” sent request for comments to Sergiy Lyovochkin on 4 questions regarding: his relations with Ivan Fursin, his affiliation with Trasta Komercbanka, nature of business of Lyovockin’s company Oskaro Investments and his position on investigations in connection with the drilling platform purchase for 400 million dollars. We received the following response:
“The Chief of the Presidential Administration of Ukraine Sergiy Lyovochkin tries to be accessible for media representatives and to respond to questions that are private in nature and not related to his position, if it does not violate his constitutional right to privacy.
On Mr. Lyovochkin’s request I inform you that he has no affiliation with the bank, you are asking about (Trasta Komercbanka). Sergiy Lyovochkin was a class mate of Ivan Fursin and they are friends. As an investor, Sergiy Lyovochkin does not interfere with the management of the company Oskaro Investment, Cyprus, which you are asking about.
Regarding the last question on the drilling platform purchase, the assessment of activity of state companies is outside the scope of authority of the Chief of the Presidential Administration. It is within the powers of the Government.
Thank you for your letter.
Chief of the Department on Access to Public Information