Medvedchuk’s Kozak. Where did ally of Putin’s friend get money for TV channels?

by Antonina Volkotrub and Daria Kaleniuk, originally published on Ukrainska Pravda

On February 2, the President Volodymyr Zelenskyi put into effect decision of the National Security and Defense Council on personal sanctions against Taras Kozak, Member of Parliament from the Opposition Platform For Life, and 8 legal entities owned by him.

This was the reason for the shutdown of TV channels 112, NewsOne, and ZiK.  According to journalists, the reason for sanctions was connection of MP’s companies with financing of terrorism and supply of coal from occupied territories “ORDLO”. 

These TV channels are considered the main mouthpiece of Kremlin propaganda in Ukraine. Although Kozak is official owner of media holding, the real beneficiary of TV channels is Viktor Medvedchuk, a personal friend of Volodymyr Putin. 

The Anti-Corruption Action Center has conducted investigation regarding origin of wealth of the representative of the Opposition Platform For Life, which he had spent on purchase of TV channels. We found that in 2013-2015 Kozak’s Cypriot company, which now brings him main income in the form of dividends in the amount of hundreds of millions of hryvnias, was unprofitable and acted as and intermediary for millions of dollars between doubtful offshore firms, one of which supplied smuggled coal from occupied territories to state companies. 

He received his first large dividend in the amount of 1.1 million EUR from the Cypriot company Turul Investments Limited in 2017 from accounts in Russian bank. These funds were lent to him through offshore companies by his common-law wife Natalia Lavreniuk (not indicated in asset declarations), who has astake in Viktor Medvedchuk’s oil business in Russia. 

The investigation showed that TV channels 112 and NewsOne cost Taras Kozak 103 million UAH, which he paid to Swiss companies in 2018-2019 through Belarus. Taras Kozak keeps main savings in the amount of 8 million EUR in Belarus, in particular in Absolutbank of Belarusian oligarch Nikolay Vorobey, who in 2019 became the co-owner of 1.1 thousand kilometers of oil pipeline in Ukraine. 

Who is Taras Kozak? And how TV channels became his property? 

Taras Kozak has been promoted in tax office and customs in Lviv and Odesa regions, where he has worked from 1993 to 2010. Kozak worked in Lviv tax office together with Sergiy Medvedchuk, Viktor Medvedchuk’s brother. Later, Viktor Medvedchuk, as head of the Presidential Administration of Kuchma, invited Kozak to be a head the regional customs office. 

After his dismissal from customs office in 2010, he became MP of Lviv Regional Council and deputy head of the NGO “Center Legal State”, at the time when non-governmental organization was headed by Viktor Medvedchuk.

In 2014, Kozak was elected as MP from the party Opposition Bloc.

In the first available declaration in 2013 MP submitted in the declaration 1.1 million UAH of income, the vast majority of which is salary, 82,000 UAH of dividends and 678,000 UAH of savings in the bank.

With this officially declared wealth former customs officer and tax officer came to the Verkhovna Rada to serve the people of Ukraine.

However, becoming MP had a striking effect on his personal wealth.

In the latest annual declaration, Kozak indicated receiving dividends in 2019 of impressive amount of 237,445,075 UAH. This is 2,893 times more than declared dividends in 2013. At the same time, his official salary has not changed much since the beginning of his term as MP. In 2019, he received about 1 million UAH from the Verkhovna Rada as MP.

MP has also significantly increased his savings in the bank: as of 2019 Kozak keeps his main savings about 8 million EUR in bank accounts, but not in Ukraine, but in … Belarus. 

Kozak receives main multimillion-dollar income not from official parliamentary activities, but in the form of dividends from his Cypriot firm Turul Investments Limited. 

What does this Cypriot company do and when has it started laying golden eggs for Kozak?

According to the Cyprus register, Kozak became owner of Turul Investments Limited on October 29, 2012. The registered official purpose of the company’s activity is holding of business investments. 

It seems that shares of this company were indicated by Kozak in his first declaration as MP, estimating them in 2013 in the amount of 33,000 UAH in the form of contributions to authorized capital of the enterprise abroad. 

In 2013, Turul Investments Limited bought shares of another Cypriot company Hakail Limited for 1,000 EUR and shares of Austrian Onyx Aviation Management GmbH for 35,000 EUR. According to audit report of Turul Investments Limited, 2013 year in the company’s activity was deplorable year, namely 1.8 million EUR of losses. 

In 20132015, Turul Investments Limited received main financial income in the form of multimillion loans issued on concessional terms from other related offshore companies. Loans were often not repaid and written off in the course of simple financial manipulations. 

For instance, on November 1, 2013, Turul Investments Limited borrowed 3.75 million USD from Erysiman Investments Limited, 2.5 million USD of which were immediately disbursed. Then, in 3 months Turul borrows from the same Erysiman and immediately disburses another 1 million 250 thousand USD. 

How does Taras Kozak’s Turul Investments Limited spend borrowed money?

Between February 4 and February 21, 2014, during the bloodiest events of the Revolution of Dignity, Turul Investments Limited bought shares of three more companies. Namely, Revelon Investments Limited in the British Virgin Islands, Migover Trading in Cyprus and 50% of stake in Havanor Management in Cyprus.

In addition, Turul borrows money further.

On February 11, 2014, Turul issued two loans to its subsidiary Hakail in the amount of 2.5 million and 400 thousand USD. Then, on August 10, 2015, it issued another huge loan to Hakail in the amount of 4 million USD. 

In total, in 2014-2015, Hakail receives about 6.5 million USD in loans from Turul. However, borrowed funds were not invested in business activities, they were issued as loans further.

Thus, on November 5, 2013, Kozak’s company Hakail Limited issued 8 million USD loan to Hong Kong-based company Arida Global Limited, which by 2015 had successfully disbursed 7.4 million USD of this loan. Eventually, the loan was written off and never repaid. 

We can make a conclusion on what this Hong Kong firm has spent the money from the investigation of “Ukrayinska Pravda” in 2016. Since 2014, Arida Global Limited has been supplying smuggled coal from occupied territories of LPR/DPR under the guise of South African coal to the state company Centerenergo.

Arida is not the only company, which have received loans from Hakail. Millions of dollars were transferred to accounts of other companies. 

To sum up: in 2013-2015, Cypriot company of Taras Kozak, which now brings him main income in the form of dividends in the amount of hundreds of millions of UAH, was unprofitable and acted as intermediary point for transfer of millions of USD between doubtful offshore companies, one of which supplied smuggled coal from occupied territories to state companies. 

And so it lasted until December 2017, when MP finally for the first time submitted in the declaration receiving dividends from Turul Investments in the amount of 36,301,320 UAH. This Cypriot firm becomes the main source of Kozak’s income, which grows exponentially every year. Namely, 128,188,274 UAH in 2018 and 237,445,075 UAH in 2019.

Let’s compare. In 2016, Taras Kozak’s biggest source of income was gift from his brother Bogdan in the form of car Audi worth 2 million UAH. 

From audit reports of the Cypriot official register, we carefully reproduced how dividends were had been paid to Taras Kozak in 2017 and where the Cypriot firm, which had been showing losses for many years, suddenly generated insane income for its owner.

On December 1, 2017, Hakail Limited declares its decision to pay 3.2 million USD of dividends to its sole shareholder Turul Investments Limited. The amount is indicated … in Russian rubles. 

On December 19, 2017, only part of dividends was paid. Namely 76.2 million Russian rubles. The remaining 1.9 million USD should be paid in coming years, but we cannot confirm payments from the audit reports, because since 2018 they are no longer published in the Cyprus register. 

Hakail Limited states presence of account in Moscow Industrial Bank in Russia on the title page of audit report in 2017. 

This means that the first large dividends in the amount of 76.2 million RUB, which amounted to 1.1 million EUR, on December 17, 2017 went to Kozak from accounts of the Cypriot Hakail Limited in Moscow Industrial Bank.

He declares receiving of dividends on December 21, 2017 in the amount of 36,301,320 UAH, which in fact is 1.1 million EUR in equivalent. 

It remains a mystery how between December 17 and December 21, 2017, 76.2 million RUB from accounts in Russian bank went to Kozak’s personal accounts in Ukraine and turned into UAH. After all, in 2017 he did not declare accounts in Russian banks or in Russian rubles, but submitted 1.1 million EUR in savings in Ukrbudinvestbank, which was co-owned at the time by Artur Chechotkin, son-in-law of Yuliya Tymoshenko. 

Now let’s get back to the question. Where does the completely unprofitable Cypriot company Hakail limited get 1.1 million EUR to pay dividends to its parent company Turul, which in its turn pays the sole shareholder Taras Kozak?

The answer is simple and obvious. Again, with the help of loan funds.

According to audit reports, on December 5, 2017, Hakail Limited borrowed 1.1 million EUR from Teteos Global Limited at 3.5% per annum with payment until December 30, 2020. It was this money that paid dividends to Turul, and later to Taras Kozak. And we do not know whether these loans were repaid. 

What does Teteos Global Limited do, which so generously gives a loan to pay dividends to Kozak? 

We open the audit report of Teteos Global Limited and see that since 2016 its beneficial owner is Natalia Lavreniuk. This is the exact common-law wife of Taras Kozak, who has 600-square-meter apartment worth 13 million USD, which is located within walking distance from Kremlin. 

It turns out that “golden eggs” in the form of multimillion dividends to MP Kozak are laid by his common-law wife, whom he does not declare and violates the law.

Where does Natalia Lavreniuk get money for payments to her husband?

This question has already been partially answered by journalists of the program Schemes, when they explored oil business of Viktor Medvedchuk’s wife. In the interview with Schemes Medvedchuk, himself calls Natalia Lavreniuk “my wife’s friend”.

It turns out that Oksana Marchenko and her friend Natalia Lavreniuk organized part-time business. Namely, they extract oil in Russia and sell it to the West. And Teteos Global Limited is one of the companies to which Medvedchuk’s oil business is registered in circumvention of the US sanctions.

Unfortunately, today there are no public audit reports regarding Kozak’s Cypriot companies in 2018-19. So, we can’t exactly reproduce where exactly crazy dividends to MP in 2018 and 2019 come from. But it is likely that old scheme has been kept and it’s just loans from offshore companies of his undeclared wife, who holdsa share of Russian oil business of Viktor Medvedchuk. 

And with these funds that Taras Kozak bought TV channels ZiK, 112 and NewsOne. 

Purchase of TV channels

Taras Kozak started purchasing TV channels in 2018, when his dividends from the Cypriot company Turul Investments became systematic and stable. And no wonder. Because the media empire costs a lot of money.

In October 2018, Kozak purchased TV channel NewsOne.

In the declataration form on significant asset changes as of October 12, 2018, he submitted iacquisition of corporate rights of News 24 hours LLC from the Swiss MW Investment AG, which was controlled at that time by former member of the Party of Regions Yevgen Muraev. The cost of this asset was 41,063,799 UAH.

Three months later, in December 2018, Kozak purchased TV channel 112. 

On December 2, 2018, Medvedchuk’s associate submitted in the declaration acquisition of corporate rights to nine Ukrainian legal entities from the Swiss company Plirofories AG. All nine companies are part of ownership structure of TV channel 112, and on 6 of them were imposed sanctions by the National Security and Defense Council in February 2021. According to the data on significant changes in property status, the value of corporate rights of these companies, for which TV channel 112 is registered, is 72,871,460 UAH.

The total value of corporate rights of two purchased TV channels was 114 million UAH, but according to “expenses and transactions” section of the declaration Taras Kozak actually paid only 103 million UAH for them. 

In summer 2019, Taras Kozak buys TV channel ZiK.

Until June 2019, TV channel ZiK was owned by Petro Dyminskyi through the Cypriot company Alvho Trading limited. Since June 14, 2019, the new sole shareholder of Alvho Trading limited became the already mentioned Kozak’s company Turul investments limited.

The exact cost of TV channel is unknown to us, but authorized capital of the Cypriot Alvho at the time of transition to Kozak’s structures was 17100 EUR. Then, media managers estimated TV channel ZiK at 15-20 million USD. At the same time, at the end of 2017, Dyminskyi himself allegedly started trading with the sum of 53 million USD

For some reason Kozak conducted operations on acquisition of at least two of three TV channels (NewsOne and 112) in Belarus, which is confirmed by data from his electronic declarations. 

Expenses and accounts in Belarus. Nikolay Vorobey. Oil pipeline 

In 2018, Taras Kozak starts his active financial activity in Belarus. 

In particular, in addition to purchase of TV channels NewsOne and 112 through Belarus for the total amount of 103 million UAH, Ukrainian MP pays 16 million UAH annually in Belarus in 2018 and in 2019 for air transportation services.

In 2019-2020, Kozak submitted in the declaration 1.2 million UAH of expenses for educational services in Belarus. It is difficult for us to imagine that MP pays someone to study at Belarusian universities worth one million UAH. Most likely that he simply uses Belarusian banks as transit to recalculate the cost of services to other companies in other countries, including Western Europe and Russia. 

In February 2020, Kozak submitted in the declaration 422,000 UAH of expenses for vacation in Belarus, in June he rented real estate worth 1.1 million UAH, and in October he even paid 313,000 UAH of charitable assistance to someone in Belarus. 

In Belarus he also constantly withdraws cash from banks and exchanges huge amounts of currency. 

Thus, in August 2020, Kozak submitted in the declaration expenses in Belarus in the amount of 163,667 UAH for the cash withdrawal commission. Usually banks charge from 1% to 2.9% from withdrawal amount, so the amount of withdrawn cash by Kozak in Belarus can range from 5 to 16 million UAH.

In September 2020, Kozak submitted in the declaration the sale of currency in Belarus in the amount of more than 25 million UAH. 

In 2018, the account in Minsk Transit Bank (JSC “MTBank”) with savings in the amount of 2,160,297 million EUR appears in the declaration of Medvedchuk’s colleague. And in 2019, Kozak entrusted preservation of another 6.5 million EUR to Belarusian Absolutbank. In the same Absolutbank have savings for considerable sums Victor Medvedchuk (850,000 EUR) and Oksana Marchenko (4 million EUR). 

Why do Taras Kozak, Viktor Medvedchuk and Oksana Marchenko keep their savings in turbulent Belarus and feel more confident, reliable and safer there than in Ukraine?

We are looking for the answer in ownership structure of Minsk Absolutbank, where this trinity feels so comfortable and safe.

Absolutbank is fully controlled through Belarusian companies Interservice LLC and Krasnyi Bor LLC by Belarusian oligarch Nikolay Vorobyov, who is close to the President Lukashenko. In January 2019, Viktor Medvedchuk had meeting with Oleksander Lukashenko, which allegedly discussed the situation in Donbass. 

Nikolay Vorobey through the company Interservice owns Belarusian Oil Bitumen Plant, which in 2019 became co-owner of Ukrainian company Prykarpatzahidtrans. And this is 1.1 thousand kilometers of pipeline Samara-Western direction, through which oil products (mainly diesel fuel) are transported from Russia to the territory of Ukraine and transit through Hungary to countries of Western Europe.

Earlier in 2018, Nikolay Vorobey’s Oil Bitumen Plant wanted to privatize state company Centerenergo. But the privatization was canceled.

It seems that Belarusian oligarch Nikolay Vorobey, in exchange for joint energy investment projects with Viktor Medvedchuk in Ukraine, has agreed to keep money of Kozak and Medvedchuk in his private wallet, namely Absolutbank, and to cover latter from the US and now Ukrainian sanctions. 

The rhetorical question remains whether Nikolay Vorobey can join such projects and work as banker for Taras Kozak and Viktor Medvedchuk without will and political cover of Oleksander Lukashenko and Vladimir Putin.

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