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A Firtash fightback or an own goal?

June 16, 2015

A few days ago this entry was published relating to the Agency for Moderisation of Ukraine – a civil society actor and an entirely Dmitry Firtash production from start to finish.

This civil society front sitting now in tandem with Ihor Kolomoisky’s efforts in Odessa (and elsewhere).

Odessa matters to both men, they both have “interests” here, just as they do in several other regions of Ukraine – notwithstanding general interest in the prolonging of oligarchical interests across Ukraine and within Ukrainian politics for as long as possible.  It is the general interest to where this entry looks with regard to Mr Firtash.

As the first link states, “Whilst Mr Kolomoisky is fighting his corner, both directly and indirectly from Ukraine, clearly Mr Firtash’s point-man in the country, Sergei Lyovochkin, and regional puppeteers such as Mykola Skoryk in Odessa, are failing him somewhat.”  For those unaware, Mr Firtash is somewhat marooned in Austria (Vienna to be exact) with the US still pursuing him for corruption and Ukraine now seizing 40 of his Group DF assets within the nation and “wanting to interview Mr Firtash”.

Mr Firtash is an experienced oligarch.  He was close to Viktor Yanukovych, but not with Mr Yanukovych.  His association with “the Family” was not as pronounced, nor as close, as that of Rinat Akhmetov.  After Yanukovych fled Ukraine, whilst Mr Akhmetov lost considerable political power as Party of Regions disintegrated and numerous “owned” politicians estranged themselves as much as possible from those connected to “the Family”, Mr Firtash did not suffer anywhere nearly as as badly – no more or no less despised than oligarchs such as Mr Pinchuk for example.

When the presidential and mayoral elections for Kyiv took place, as is well known now,  and as was obvious before, Mr Firtash financially and politically backed Messrs Poroshenko and Klitschko.  Indeed Mr Firtash had been sponsoring UDAR and Mr Klitschko for some time prior to “the Family” fleeing.

Thus grubby little deals were done between Mr Firtash and the now President and Mayor of Kyiv alike.  Further Mr Firtash also heavily backed the Radical Party and Oleg Lyashko (undoubtedly for their unashamed populism).  What choice did he have?  Backing Ms Tymoshenko was impossible considering the acidic relationship between them, and Arseniy Yatseniuk was still seen as too close to Ms Tymoshenko despite the ever-growing personal chasm between them.  Notwithstanding that, Mr Yatseniuk and rival oligarch Mr Kolomoisky had already done their own grubby little deal.

That said, Mr Firtash as an experienced oligarch, still has “his people” within both Yatseniuk’s and Tymoshenko’s respective parties too.  “His people” in key Rada committees overseeing his interests?  Of course.

The grubby deal with the president in particular led to the placing of, or retaining some of, Mr Firtash’s people in particularly lofty and influential positions – and some positions of extreme importance.  One such position being Valentyn Nalyvaychenko as head of the SBU (Ukrainian Secret Service).  Mr Nalyvaychenko is a “Firtash man”.

So far, all so predictably grubby as such affairs always are when arrangements are agreed behind the Ukrainian political/power curtain.

Retaining Mr Nalyvaychenko as head of the SBU, a position he assumed on 23rd February 2014 immediately after “the Family” fled made sense prima facie.  Mr Nalyvaychenko has previous experience in national security, and to be fair, the SBU has consistently improved and continued to get its act together under his tenure during extremely difficult circumstances.

It also nicely fulfilled part of the power deal stuck between Messrs Firtash, Poroshenko and Klitschko prior to their subsequent election.

It seemed to bother nobody that Mr Firtash is known to talk to “our friends” from Vauxhall Bridge (no doubt amongst other foreign intelligent services) but much more importantly it seemed to bother nobody that Mr Firtash is directly associated with Semion Mogilevich who is variously dubbed “The Boss of Bosses”, “The Brainy Don” and “Don Semyon” and is one of the, if not the biggest, organised crime boss of what is collectively called the “Russian Mafia”.

So be it – although any Ukrainian counterintelligence officer would be having a small fit that their ultimate boss was known the be a “Firtash man” and thus somewhat beholding to somebody with known connections to foreign intelligence services as well as the most accomplished and powerful of mafia bosses on the continent, if not amongst those on the planet.

Anyway, whilst Mr Kolomoisky is fighting a rear-guard action, so too is Mr Firtash.

The first major Firtash attack coming in a Vienna courtroom whilst fighting extradition to the USA – which he ultimately won successfully claiming he is subject to political persecution.  Mud was slung in the presidential direction during proceedings.

Ukraine then hopped upon the US coattails when the US stated it would continue to seek Mr Firtash’s attendance in a US courtroom.  Ukraine then seizing Group DF assets and letting it be known he should expect to be questioned if returning to Ukraine (and possibly deported to the US too).  Support to go after Mr Firtash not only came from the a miffed presidential party after confidential conversations were aired in a Vienna courtroom, but also Prime Minister Yatseniuk’s People’s Front party that Mr Firtash did not back.

Clearly Mr Kolomoisky who did back Prime Minister Yatseniuk and party smelled Firtash blood in the oligarchical water.  With no “agreements” with, nor sponsoring of, The People’s Front, their hands were not tied as the Poroshenko party’s had previously been.  Firtash exile under US pressure had been enough for the Poroshenko side until Mr Firtash broke confidences in saving himself from US extradition.

The moment those confidences were broken is a Vienna courtroom, the position of Mr  Nalyvaychenko as SBU head (and possibly other “Firtash people”) was doomed.  It was a matter of months at most (a reshuffle is expected in the Autumn, of Cabinet and senior positions), or perhaps even weeks.

A “Firtash man” could no longer continue to head the SBU once confidential agreements had been broken between Messrs Firtash and Poroshenko.

The demise of Mr Nalyvaychenko has no doubt been expedited by Mr Firtash appearing on the Russian television channel Russia-24 yesterday calling on President Poroshenko to collapse the Rada.  The timescale for the removal of Mr Nalyvaychenko as SBU head should now be measured in minutes, hours and days, rather than weeks or months.

President Poroshenko now has to act.  Politically he has no other choice.  Any reshuffle is simply too far away after this latest Firtash attack.

As for Mr Firtash appearing on a  major Russian channel, rather than his own major Inter channel, to deliver this message?  It probably has less to do with a pro/anti Ukrainian or Russian stance than it has to being a public call to those at the very top of serious Russian organised crime that their interests in Ukraine will suffer tremendously should he be pushed out.  After all patriotism, be it for Russia or Ukraine comes a very distant second to “business” and “business interests” for organised crime – patriotism be damned.

(Perhaps a temporary exception to that is organised crime within the Odessa mafia, which is now confronted with Russian organised crime in Crimea and adjustments have not yet been fully made, thus a more patriotic stance temporarily exists.)

Regular readers will know that in mid-March, an entry appeared here that stated both Messrs Firtash and Kolomoisky had decided that a “Rada reset” was in order – this before either man had fallen from grace.

“The Spring of 2016 is looking like an increasingly possible date for another Rada reset. Indeed it is probably the worst kept secret within the Kolomoiski and Liovochkin camps, that a Spring 2016 Rada reset is currently anticipated.”

Thus a Firtash/Kolomoisky induced “Rada reset” in 2016 has been expected for a long time.  The current government seemingly will to offer a “Cabinet Reshuffle” as a compromise to the “owned” political leaderships to leave their sponsors.  Deputy Prime Minister Lyashko possibly awaits – God forbid!

That Mr Firtash clearly feels in such a weakened position as go public with confidential agreements with a president, to make public appeals on prime-time major Russian TV channels to collapse a government he didn’t back thoroughly enough, notwithstanding pushing his own social contract to the Ukrainian constituency via his civil society initiatives on his own Inter media group, possibly says more about Mr Firtash than the tackling of Ukrainian corruption and its oligarchy – then again, possibly it understates the Ukrainian effort.

Whatever the case, it seems very likely that Mr Firtash (and Mr Kolomoisky) may become increasingly desperate to retain their grip on power and influence through whatever means – possibly volatile means – unless another “agreement” is reached regarding their release on power and departure from politics in return for a de jure or de facto amnesty on past deeds and nefariously acquired assets, together with the throwing of occasional, but vastly reduced, carrots.

An interesting summer and autumn oligarch watching lays ahead.

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