Atlantic Council

October 22, 2019 – Schiff witness William Taylor has ties to Burisma, Atlantic Council, Soros, and McCain leaker, David Kramer

(Credit: Communities Digital News)

“The star witness in the Schiff Pelosi impeachment farce, Ambassador William Taylor, has long-standing ties and a financial relationship to a Burisma funded think tank, according to Breitbart News investigative reporter Aaron Klein. Klein also reports that Taylor has a long-standing relationship with David Kramer, the advisor to Senator John McCain who leaked the Steele Dossier to Buzzfeed.

More ominously a Schiff staffer on a Burisma funded trip to Ukraine in August met with Ambassador Taylor to discuss the “whistleblower” complaint.  The Atlantic Society, funded by Burisma, also receives funding from the George Soros Open Society Foundations. It is a trifecta of corruption undercutting Taylors testimony.

According to Breitbart:

U.S. Ambassador to Ukraine Bill Taylor, who provided key testimony to the Democrats’ controversial impeachment inquiry yesterday, has evidenced a close relationship with the Atlantic Council think tank, even writing Ukraine policy pieces with the organization’s director and analysis articles published by the Council.

The Atlantic Council is funded by and works in partnership with Burisma, the natural gas company at the center of allegations regarding Joe Biden and his son, Hunter Biden.

In addition to a direct relationship with the Atlantic Council, Taylor for the last nine years also served as a senior adviser to the U.S.-Ukraine Business Council (USUBC), which has co-hosted events with the Atlantic Council and has participated in events co-hosted jointly by the Atlantic Council and Burisma.

Another senior adviser to the USUBC is David J. Kramer, a long-time adviser to late Senator John McCain. Kramer played a central role in disseminating the anti-Trump dossier to the news media and the Obama administration. Taylor participated in events and initiatives organized by Kramer.

The links may be particularly instructive after Breitbart News reported that itinerary for a trip to Ukraine in August organized by the Burisma-funded Atlantic Council for ten Congressional aides reveals that a staffer on Rep. Adam Schiff’s House Permanent Select Committee on Intelligence held a meeting during the trip with Taylor.  The pre-planned trip took place after the so-called whistleblower officially filed his August 12 complaint and reportedly after a Schiff aide was contacted by the so-called whistleblower.” (Read more: Community Digital News, 10/23/2019) (Archive)

August 24-31, 2019 – Adam Schiff staffer meets with impeachment witness, Bill Taylor in Ukraine

Thomas Eager (l) and Bill Taylor (Credit: public domain)

“The Atlantic Council is funded by and works in partnership with Burisma, the natural gas company at the center of allegations regarding Joe Biden and his son, Hunter Biden.

Taylor has been called by House Democrats to appear next week to provide a deposition as part of the investigation being led by Schiff into President Trump’s phone call with Ukrainian President Volodymyr Zelensky.

Taylor himself has evidenced a close relationship with the Burisma-funded Atlantic Council, writing analysis pieces published on the Council’s website and serving as a featured speaker for the organization’s events. He also served for nine years as senior advisor to the U.S.-Ukraine Business Council, which has co-hosted scores of events with the Atlantic Council.

As Breitbart News reported, Thomas Eager, a staffer on Schiff’s House Intelligence Committee, took a trip to Ukraine in August billed as a bipartisan “Ukraine Study Trip” in which ten Congressional staffers participated.

Eager is also currently a fellow at the Atlantic Council’s Eurasia Congressional Fellowship, a bipartisan program that says it “educates congressional staff on current events in the Eurasia region.” The pre-planned Ukraine trip was part of the fellowship program.

Burisma in January 2017 signed a “cooperative agreement” with the Council to specifically sponsor the organization’s Eurasia Center, the same center that sponsored Eager’s Ukraine trip.

A closer look at the itinerary for the August 24 to August 31 trip shows that the delegation’s first meeting upon arrival in Ukraine was with Taylor. (Read more: Breitbart, 10/17/2019)  (Archive)

March 23, 2017 – Crowdstrike co-founder and donor to the Clinton Foundation, Dmitri Alperovitch, is a senior fellow at the Atlantic Council, a think tank with openly anti-Russian sentiments

Dmitri Alperovitch (Credit: Sebastian Gabriel/picture alliance)

“The cyber security firm outsourced by the Democratic National Committee, CrowdStrike, reportedly misread data, falsely attributing a hacking in Ukraine to the Russians in December 2016. Voice of America, a US Government funded media outlet, reported, “the CrowdStrike report, released in December, asserted that Russians hacked into a Ukrainian artillery app, resulting in heavy losses of howitzers in Ukraine’s war with Russian-backed separatists. But the International Institute for Strategic Studies (IISS) told VOA that CrowdStrike erroneously used IISS data as proof of the intrusion. IISS disavowed any connection to the CrowdStrike report.

(…) The investigation methods used to come to the conclusion that the Russian Government led the hacks of the DNCClinton Campaign Chair John Podesta, and the DCCC were further called into question by a recent BuzzFeed report by Jason Leopold, who has developed a notable reputation from leading several non-partisan Freedom of Information Act lawsuits for investigative journalism purposes. On March 15 that the Department of Homeland Security released just two heavily redacted pages of unclassified information in response to an FOIA request for definitive evidence of Russian election interference allegations. Leopold wrote, “what the agency turned over to us and Ryan Shapiro, a PhD candidate at MIT and a research affiliate at Harvard University, is truly bizarre: a two-page intelligence assessment of the incident, dated Aug. 22, 2016, that contains information DHS culled from the internet. It’s all unclassified — yet DHS covered nearly everything in wide swaths of black ink. Why? Not because it would threaten national security, but because it would reveal the methods DHS uses to gather intelligence, methods that may amount to little more than using Google.”

Hillary Clinton accepts the Atlantic Council’s 2013 Distinguished International Leadership Award. (Credit: YouTube)

In lieu of substantive evidence provided to the public that the alleged hacks which led to Wikileaks releases of DNC and Clinton Campaign Manager John Podesta’s emails were orchestrated by the Russian Government, CrowdStrike’s bias has been cited as undependable in its own assessment, in addition to its skeptical methods and conclusions. The firm’s CTO and co-founder, Dmitri Alperovitch, is a senior fellow at the Atlantic Council, a think tank with openly anti-Russian sentiments that is funded by Ukrainian billionaire Victor Pinchuk, who also happened to donate at least $10 million to the Clinton Foundation.

In 2013, the Atlantic Council awarded Hillary Clinton it’s Distinguished International Leadership Award. In 2014, the Atlantic Council hosted one of several events with former Ukrainian Prime Minister Arseniy Yatsenyuk, who took over after pro-Russian President Viktor Yanukovych was ousted in early 2014, who now lives in exile in Russia.” (Read more: CounterPunch, 3/23/2017)

March 20, 2019 – The director of Ukraine’s anti-corruption bureau, Artem Sytnyk, admits to helping Clinton’s campaign by sabotaging Trump’s

Artem Sytnyk (Credit: BBC)

“The Blaze has released an audio recording that they recently obtained that appears to show Artem Sytnyk, Director of the National Anti-Corruption Bureau of Ukraine, admitting that he tried to boost the presidential campaign of Hillary Clinton by sabotaging then-candidate Donald Trump’s campaign.

The connection between the Democratic National Committee (DNC) and the Ukrainian government was veteran Democratic operative Alexandra Chalupa, “who had worked in the White House Office of Public Liaison during the Clinton administration” and then “went on to work as a staffer, then as a consultant, for Democratic National Committee,” Politico reported.

Chalupa was working directly with the Ukrainian embassy in the United States to raise concerns about Trump campaign chairman Paul Manafort and, according to Politico, she indicated that the Embassy was working “directly with reporters researching Trump, Manafort and Russia to point them in the right directions.”

The Ukrainian embassy political officer who worked at the embassy at the time, Andrii Telizhenko, stated that the Ukrainians “were coordinating an investigation with the Hillary team on Paul Manafort with Alexandra Chalupa” and that “the embassy worked very closely with” Chalupa.

The Blaze highlighted an email from WikiLeaks from Chalupa to Louis Miranda at the DNC:

“Hey, a lot coming down the pipe. I spoke to a delegation of 68 investigative journalists from Ukraine last night at the Library of Congress, the Open World Society forum. They put me on the program to speak specifically about Paul Manafort. I invited Michael Isikoff, who I’ve been working with for the past few weeks, and connected him to the Ukrainians. More offline tomorrow, since there was a big Trump component you and Lauren need to be aware of that will hit in the next few weeks. Something I’m working on that you should be aware of.”

The Blaze then reported that Sytnyk, who eventually “was tried and convicted in Ukraine for interfering in the U.S. presidential election in 2016,” released a “black ledger” on Manafort during the 2016 presidential election that eventually led to Manafort’s downfall.

(Read more: The Daily Wire, 10/07/2019)

January 19, 2017 – The shady arrangement between the Atlantic Council and Burisma Holdings

The Atlantic Council has its own page on Burisma Holding’s website. (Credit: Burisma Holding)

“The shady arrangement between the Atlantic Council and Burisma – the gas company at the center of the ‘Ukrainegate’ scandal – is just one dubious deal out of many at a DC think tank that has become a clearinghouse for legal corruption.

With its relentless focus on corruption in Russia and Ukraine, the Atlantic Council has distinguished itself from other top-flight think tanks in Washington. Over the past several years, it has held innumerable conferences and panel discussions issued a string of reports and published literally hundreds of essays on Russia’s “kleptocracy” and the scourge of Kremlin disinformation.

At the same time, this institution has posed as a faithful partner to Ukraine’s imperiled democracy, organizing countless programs on the urgency of economic reforms to tamp down on corruption in the country.

But behind the curtain, the Atlantic Council has initiated a lucrative relationship with a corruption-tainted Ukrainian gas company, the Burisma Group, that is worth as much as $250,000 a year. The partnership has paid for lavish conferences in Monaco and helped bring Burisma’s oligarchic founder out of the cold.

(…) Even with Hunter Biden on his company’s board, Zlochevsky was still seeking influential allies in Washington. He found them at the Atlantic Council in 2017, literally hours after he was cleared of corruption charges in Ukraine.

Joe Biden speaks to the Atlantic Council in August, 2014. (Credit: public domain)

On January 19, 2017 – just two days after the investigation of Zlochevsky ended – Burisma announced a major “cooperative agreement” with the Atlantic Council. “It became possible to sign a cooperative agreement between Burisma and the Atlantic Council after all charges against Burisma Group companies and its owner [Mykola] Zlochevskyi were withdrawn,” the Kyiv Post reported at the time.

The deal was inked by the director of the Atlantic Council’s Eurasia program, a former US ambassador to Ukraine named John Herbst.

Since then, Burisma helped bankroll Atlantic Council programming, including an energy security conference held this May in Monaco, where Zlochevsky currently lives.

“[Zlochevsky] invited them purely for whitewashing purposes, to put them on the façade and make this company look nice,” Daria Kaleniuk, executive director of Ukraine’s Anti-Corruption Action Center, said of the Monaco event to the Financial Times.

Burisma Group in partnership with HSH Prince Albert II of Monaco June 2, 2016, in Monte Carlo, attends a forum on “Energy Security for the Future. Hunter Biden is also listed as a guest speaker. (Credit: public domain)

At one such conference in Monaco, then-Burisma board member Hunter Biden declared, “One of the reasons that I am proud to be a member of the board at Burisma is that I believe we are trying to figure out the way to create a radical change in the way we look at energy.” (Hunter Biden left Burisma with $850,000 in earnings when his father launched his presidential campaign this year).

While the Atlantic Council was bringing Burisma in from the cold, the company was still too toxic for much of the business world to touch.

As the Financial Times noted, the American Chamber of Commerce in Ukraine had rejected Burisma’s application for membership. “We’ve never worked with them for integrity reasons. Never passed our due diligence,” a Western financial institution told the newspaper.

“The company just does not pass the smell test,” a businessman in Ukraine commented to the Financial Times. “Their reputation is far from squeaky clean because of their baggage, the background and attempts to whitewash by bringing in recognizable Western names on to the board.”

In fact, a year before the Atlantic Council initiated its partnership with Burisma, the think tank published a paper describing Zlochevsky as “openly on the take” and deriding board members Hunter Biden and former Polish President Aleksander Kwasniewski as his “trophy foreigners.” (Kwasniewski is today a member of the Atlantic Council’s international advisory board).

For Herbst, however, Burisma’s generosity seemed too hard to resist.

“If there are companies that want to support my work, if those companies are not doing anything that I know to be illegal or unethical, I’ll consider their support,” Herbst stated in reply to questions about the Burisma partnership from the Ukrainian news site, Hromadske.

“They’ve been good partners,” he added.” (Read more: The GrayZone, 10/13/2019)  (Archive)

January 19, 2017 – Ukrainian oligarch Victor Pinchuk, joins the Atlantic Council’s Advisory Board who then partners with Burisma Holdings

(…) “In addition to being a Clinton Foundation donor, Pinchuk is also on the International Advisory Board of the Atlantic Council – a NATO-aligned American think tank specializing in the field of international affairs.

Pinchuk’s fellow Advisory Board members are industry leaders and former heads of state.

Their Board of Directors list is equally – if not more – impressive.

The Atlantic Council has been historically active in Ukraine through its Ukraine in Europe Initiative. More recently, on January 19, 2017, the Atlantic Council announced a partnership with Ukrainian natural gas company Burisma Group.

A conference on the U.S.-Ukraine partnership, energy independence and security, as well as prospects for the Ukrainian economy was held on April 17, 2018. It was hosted by a globally recognized non-governmental U.S. think tank Atlantic Council and Ukraine’s largest private gas producer Burisma Group with support from the Kharkiv Regional Administration. The forum was attended by the Kharkiv Governor Yuliya Svitlychna, the former U.S. Ambassador to Ukraine Roman Popadiuk, former U.S. Deputy Assistant Secretary of Defense for Russia, Ukraine, and Eurasia Evelyn Farkas, President of U.S.-Ukraine Business Council (USUBC) Morgan Williams and Advisor to the Board of Directors at Burisma Group and Chairman of the Board at the Association of Ukrainian Gas Producers Vadym Pozharskyi. (Credit: 112 Ukraine News)

Hunter Biden, former VP Joe Biden’s son, sits on Burisma’s board.

Biden was placed on Burisma’s board after Victoria Nuland and U.S. Ambassador to Ukraine Geoffrey Pyatt held a phone conversation regarding the installation of Arseniy Yatsenyuk in place of then-President Yanukovych. Need for support from VP Biden was noted (more here):

On or before February 4, 2014 – Call between Pyatt and Nuland discussing removal of Yanukovych and installation of Yatsenyuk.

February 22, 2014 – Yanukovych was removed as President of Ukraine.

February 27, 2014 – Yatsenyuk was installed as Prime Minister of Ukraine. Yatsenyuk would resign in April 2016 amidst corruption accusations.

April 18, 2014 – Hunter Biden was appointed to the Board of Directors for Burisma – one of the largest natural gas companies in Ukraine.

April 22, 2014 – VP Biden travels to Ukraine and offers support and $50 million in aid for Yatsenyuk’s shaky new government.

The Atlantic Council, along with the Brookings Institute and the Center for Strategic and International Studies, were the subject of an unflattering portrayal in a New York Times article, Foreign Powers Buy Influence at Think Tanks:

More than a dozen prominent Washington research groups have received tens of millions of dollars from foreign governments in recent years while pushing United States government officials to adopt policies that often reflect the donors’ priorities, an investigation by The New York Times has found.

The think tanks do not disclose the terms of the agreements they have reached with foreign governments. And they have not registered with the United States government as representatives of the donor countries, an omission that appears, in some cases, to be a violation of federal law.

As a result, policymakers who rely on think tanks are often unaware of the role of foreign governments in funding the research.

The arrangements involve Washington’s most influential think tanks, including the Brookings Institution, the Center for Strategic and International Studies, and the Atlantic Council.

Each is a major recipient of overseas funds, producing policy papers, hosting forums and organizing private briefings for senior United States government officials that typically align with the foreign governments’ agendas.

Some interesting connections run through the Atlantic Council.” (Read more: themarketswork, 3/11/2018)

February 2, 2016 – Bloomberg’s report that Burisma investigation was dormant when Biden had prosecutor fired, is incorrect

Bloomberg reported that “at the time Biden made his ultimatum [to fire prosecutor], the probe into the company — Burisma Holdings, owned by Mykola Zlochevsky — had been long dormant”

This appears to be untrue.

Bloomberg’s statement is based on information from Kasko, the rival to prosecutor Shokin. In May 2019 interview, Shokin says that they had been planning to interview Hunter Biden and Devon Archer.

Shokin says that he “finally crossed the threshold on February 2, 2016, when we went to the courts with petitions for re-arresting the property of Burisma.”

If Shokin had seized Burisma property on Feb 2, 2016, then the Prosecutor General’s investigation of Zlochevsky and Burisma was obviously not “dormant” as reported by Bloomberg. So … can seizure of Zlochevsky property on Feb 2, 2016, be confirmed or not?

There are public reports that the Prosecutor General Office (Shokin’s PGO) seized all of Zlochevsky’s “movable and immovable property” under suspicion of “illicit enrichment” under Part 3 of Article 368-2 of the Criminal Code of Ukraine.

This doesn’t prove that Biden’s demands that Shokin be removed were connected to Shokin’s seizure of property belonging to Hunter Biden’s patron and employer, Zlochevsky, but it does show that and others are shoveling disinformation about “dormant.”

The Atlantic Council had been demanding Shokin’s removal on the grounds that he had been insufficiently zealous in prosecuting Yanukovych associates.

On Jan 19, 2017 (two days after Joe Biden visit to Ukraine), Atlantic Council had signed a “cooperative agreement” with Burisma (Hunter’s connection).” (Read more: Stephen McIntyre/Twitter, 9/23/2019)  (Archive)

April 30, 2014 – March 15, 2016: The Kolomoisky pyramid starts with Hillary Clinton and Victoria Nuland at the State Department and Christine Lagarde of the IMF

(Credit: John Helmer)

“When Igor Kolomoisky (lead image, centre) financed anti-Russian units operating with the Ukrainian Army in the Ukrainian civil war, he was a staunch ally of Petro Poroshenko’s government in Kiev and the Obama Administration’s chief Ukraine policymakers, Secretary of State Hillary Clinton (left) and her Assistant Secretary for European Affairs, Victoria Nuland (right).

They in turn dominated the voting on the board of directors of the International Monetary Fund (IMF), led by managing director Christine Lagarde. Following the US regime change which installed Poroshenko’s regime in the spring of 2014, the IMF voted massive loans for the Ukraine to replace the Russian financing on which the regime of Victor Yanukovich had depended.  More than a third of the fresh IMF money was paid out by the National Bank of Ukraine (NBU), the state’s central bank, into PrivatBank controlled by Kolomoisky and his partner, Gennady Bogolyubov.

At the time, investigations of Kolomoisky’s business and banking practices, and the special relationship he cultivated with the NBU, reported he was stealing the money through a pyramid of front companies lending each other the IMF cash which was not intended to be repaid. Clinton, Nuland, Lagarde and the IMF staff and board of directors ignored the evidence, as they continued to top up Kolomoisky’s pyramid. Criminal investigations by the US Department of Justice and the Federal Bureau of Investigation (FBI) were also reported at the time; they were neutralized by their superiors.

A new Delaware state court filing a month ago, triggering new US media reports, appears to signal a shift in US Government policy towards Kolomoisky. Or else, as some Ukrainian policy experts believe, it is a move by US officials to put pressure on the new Ukrainian President, Volodymyr Zelensky, whom Kolomoisky supported in his successful election campaign to replace Poroshenko.

In the new court papers, front company names and the count and value of US transactions between them,  which PrivatBank has dug out of its own bank records,  is published for the first time. But the scheme itself is not new. It was fully exposed in 2014-2015 in this archive.  Nor is it news, as subsequent US media reports claim, that the FBI is investigating Kolomoisky and his US associates for criminal racketeering. The FBI investigation was first reported here.

(Credit: Steve Bell, August 28, 2014)

What is missing is an explanation of why it has taken so long for the PrivatBank case against Kolomoisky to surface in the US courts and in the US press. Also missing is a list of the accomplices and co-conspirators in the scheme. These include officials of the IMF,  the US and Canadian Governments who knowingly directed billions of dollars into the NBU,  from which, as they knew full well at the time, the money went out to Kolomoisky’s PrivatBank, the largest single Ukrainian recipient of the international cash. At the top of the list of accomplices, immediately subordinate to Clinton, Nuland and Lagarde, are David Lipton, the US deputy managing director  at the IMF, and the head of the IMF in Ukraine until 2017, Jerome Vacher.

The plaintiff in the Delaware Court of Chancery is PrivatBank; it is represented by the Quinn Emanuel law firm of New York and Washington, DC.

In addition to Kolomoisky and Gennady Bogolyubov, his business partner and co-shareholder in the bank, three other individuals are named as defendants – Mordechai Korf, Chaim Schochet, and Uriel Laber. They are based in the US where they have run the US trading, production, management and investment companies which Privat now alleges were on the receiving end of the embezzlement from the bank and the onward money-laundering chain.

The story of Kolomoisky, Korf and Schochet was first reported in April 2015 here.

Left to right: Mordechai Korf; Chaim Schochet, Korf’s brother-in-law; and Uriel Laber.  Because Korf, Schochet and Laber all live in Miami, the local newspaper has investigated some of their other schemes; here’s an investigation of the environmental damage of their manganese mine in Georgia. A catch-up investigation was reported by the Kyiv Post in May 2019.

The central allegation of the new court case is: “From at least 2006 through December 2016, the UBOs  [Ultimate Beneficial Owners – Kolomoisky, Bogolyubov] were the majority and controlling stockholders of PrivatBank, one of Ukraine’s largest privately-held commercial banks. During that time period, the UBOs used PrivatBank as their own personal piggy bank—ultimately stealing billions of dollars from PrivatBank and using United States entities to launder hundreds of millions of dollars’ worth of PrivatBank’s misappropriated loan proceeds into the United States to enrich themselves and their co-conspirators.”

Gennady Bogolyubov (l) and Igor Kolomoisky (Credit: public domain)

The racket – called the Optima schemes in the court papers after the names of several of the Delaware-registered companies used as fronts for moving the money into US assets – was this: “Through the Optima Schemes, the UBOs [Kolomoisky and Bogolyubov] exploited their positions of power and trust at PrivatBank to cause PrivatBank to issue hundreds of millions of dollars’ worth of illegitimate, inadequately-secured loans to corporate entities also owned and/or controlled by the UBOs and/or their affiliates (the “Optima Scheme Loans”). To facilitate and fraudulently conceal the Optima Schemes from discovery, the UBOs created and utilized a secretive business unit within PrivatBank’s operations (the “Shadow Bank”) to fund the fraudulent loans and launder those loan proceeds through a sophisticated money laundering process.”

“The stated purpose for each loan involved in the Optima Schemes was typically for financing the activities of the ostensible corporate borrower. The Optima Scheme Loans, however, were sham arrangements and the proceeds were not in fact used for that purpose. Instead, sometimes within minutes of being disbursed, the loan proceeds were cycled through dozens of UBO-controlled or affiliated bank accounts at PrivatBank’s Cyprus branch (“PrivatBank Cyprus”) before being disbursed to one of multiple Delaware limited liability companies or corporations (or other United States-based entities), all of which were [controlled by the UBOs].”

“In effect, the UBOs utilized a Ponzi-type scheme: old loans issued by PrivatBank would be ‘repaid’ (along with the accrued interest) with new loans issued by PrivatBank, and those new loans issued by PrivatBank would then be repaid with a new round of loans. The UBOs and their co-conspirators continuously carried out this process to conceal their frauds. Thus, proceeds from new PrivatBank loans were used to give the appearance that the initial PrivatBank loans (along with the accrued interest) were repaid by the borrower when in fact there was no actual repayment.”

“The proceeds from the new PrivatBank Ukraine loans were then laundered through various accounts at PrivatBank Cyprus to disguise the origin of the funds (i.e., a new loan from PrivatBank), and then used to purport to pay down the initial loans plus accrued interest. On paper, this appeared to be a repayment, but in reality, it was a sham and fraud, as PrivatBank was repaying itself and increasing its outstanding liabilities in the process. This process was carried out over and over again, over a period of many years, giving the appearance that PrivatBank’s corporate loan book was performing when, in fact, new loans were being continually issued to new UBO-controlled parties to ‘pay down’ the prior, existing loans. As a result, the size of the ‘hole’ in PrivatBank’s corporate loan book grew and grew, with each iteration of a loan plus interest being ‘repaid’ through the issuance of a new loan, which accrued interest itself before being ‘repaid’ through the issuance of yet a further new loan.

(…) Most of the fresh evidence presented in Privatbank’s court papers has been gathered from Cyprus. There, according to the bank’s case, 41 front companies were used to move money. “Even though the Laundering Entities had billions of dollars moving in and out of their accounts, in reality, the entities had no business, assets, operations, or employees and were shell entities deployed for money laundering purposes.”

When the money was moved to the US,  it was then spent on real estate – four commercial buildings in Cleveland, Ohio;  two in Dallas, Texas;  one in Harvard, Illinois – together with six ferro-alloy and steel production and trading companies operating in several US states.  The court papers report the value of the real estate at acquisition at just over $287.5 million; the value of the metals companies, $468.7 million.

In addition, there were miscellaneous financial transfers with no clear end-purpose or investment target. “Based on information analyzed to date, Defendants laundered approximately $622.8 million worth of fraudulently obtained loan proceeds into the Optima Conspirators, including $188.1 million to Optima Group, $162.3 million to Optima Ventures, $153.7 million to Optima Acquisitions, $103 million to Optima International, $9 million to Warren Steel Holdings, and $6.7 million to Felman Trading. PrivatBank received no consideration in exchange for these transfers and the loans associated with the transfers were not repaid in full.”

Grand total, $1,379 million.

(…) Lawyers for the defendants are not commenting on the Delaware allegations. It can be anticipated that Kolomoisky will argue the Privatbank loans weren’t shams, and that they were repaid to the bank.  Kolomoisky has already won counter claims against PrivatBank in courts in London and Kyiv; he is now negotiating with the Kiev government to recover a 25% stake in the bank. “We have always said that we are open to negotiations. We believe that we are the injured party, that we have been robbed,” Kolomoisky has told Reuters. “Kolomoisky calculates he is due a 25 percent stake in the bank because of the capital he had put into it. Give us then our 25 percent and keep 75, we will have a joint-stock company. There will be a 25 percent participation and 75 percent by the state, as one of the options.”

Reuters also reports the Ukrainian central bank and the IMF believe Privat “was used as a vehicle for fraud and money-laundering while Kolomoisky owned it, and said the government was forced to inject $5.6 billion of taxpayers’ money into the lender to shore up its finances.” For more detail, click to read this.

The work on the transactions detailed in the Delaware court papers was commissioned by PrivatBank and the NBU from Kroll, a due diligence firm as well known for white-washing the affairs of its clients as for investigating fraud. Kroll’s report was then leaked to Graham Stack. In his report, published on April 19, Stack concludes: “The money was moved through a PrivatBank subsidiary in Cyprus. The arrangement helped hide the fact that cash was disappearing because the National Bank of Ukraine treated the Cyprus branch of PrivatBank the same as it would domestic branches. This designation meant officials never detected that cash transferred to Cyprus was leaving Ukraine. Meanwhile, Cypriot regulators either failed to detect that the various bank transfers totalling $5.5 billion were backed by bogus contracts, or didn’t take the necessary action to stop them.”

The IMF’s staff head for Ukraine, Nikolai Gueorguiev,  claimed that in March 2015 he had ordered “a new wave of  bank diagnostics” to monitor related-party lending, liquidity and capital adequacy at PrivatBank; he was dissembling.

Graham Stack (Credit: public domain)

Stack (right) also reports Kolomoisky’s response to the Delaware case: “‘I categorically deny the allegations made by the National Bank of Ukraine,’ Kolomoisky said, adding that regulators had all the access they needed to monitor his bank’s activities. He painted the authorities’ nationalization of his lending business as an asset grab. ‘Management of the [Ukrainian central bank] had as its main purpose not the support of the country’s largest bank, but its nationalization and the expropriation of the assets provided as security, together with the persecution and pressuring of the former shareholders,’ Kolomoisky said.”

Stack is an independent researcher and reporter of Ukrainian business and politics. Anders Aslund is an employee of Victor Pinchuk, a Ukrainian oligarch with bank, media and steel interests who has long been a rival of Kolomoisky’s. Aslund, a former Swedish government official, has worked for US think-tanks funded by Pinchuk. Aslund is now at the Atlantic Council in Washington, DC. The council lists Pinchuk’s foundation as having giving it up to $500,000 in financing for research, including Aslund’s pay.  The US State Department, the British Foreign Office, and George Soros’s foundations are also listed as large donors.

[Anders] Aslund (left) reported on the charges on June 4. Aslund claims to be reading about the stealing scheme for the first time. “The money trail is surprisingly simple. To begin with, the ultimate beneficiary owners collect retail deposits in Ukraine by offering good conditions and service. The money then flows to their subsidiary, PrivatBank Cyprus. In Cyprus, they benefit from the services of two local law firms. Untypically, the ultimate beneficiary owners did not take the precaution to establish multiple layers of shell companies in Cyprus, the British Virgin Islands, and Cayman Islands, as is common among Russians with seriously dirty money. Instead, they operated with three US individuals in Miami, who helped them to set up a large number of anonymous LLCs in the United States, mainly in Delaware, but also in Florida, New Jersey, and Oregon.”

Aslund expresses surprise that among Kolomoisy’s investments there were US ferro-alloy and steel plants and traders. “More remarkable is that Kolomoisky and Bogolyubov, according to the suit, purchased several ferroalloy companies in the United States, Felman Production Inc., in West Virginia; Felman Trading Inc. and Georgian Manganese, LLC; Warren Steel Holdings in Warren, Ohio; Steel Rolling Holdings Inc., Gibraltar, Michigan; CC Metals and Alloys, LLC, in Kentucky; Michigan Seamless Tubes, Michigan. These appear to be medium-sized companies in small places. Real people worked in these enterprises. Why didn’t anybody raise questions about the dubious owners?” (Read much more: John Helmer, 6/30/2019)  (Archive)

(Republished in part, with permission)