Archive for the ‘Tymoshenko’ Category

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Good business, bad politics. Tigipko

January 2, 2017

Having written about Viktor Pinchuk in the previous entry, this post concentrates on another Dnipro Clan oligarch and long time acquaintance, Sergei Tigipko, who has been spending money recently.

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Mr Tigipko it has to be said is an interesting soul whose business activities are somewhat difficult to keep an all-seeing eye upon.

Perhaps he is fated to be that way, for ever since birth Mr Tigipko has not been what he appears to be.  Mr Tigipko was actually born on 13th February 1960 – officially, but in fact he was born in the early hours of 14th February.  Due to a bureaucratic mix up between medical night shift and morning shift workers the wrong date was officially recorded.  It is claimed, similar to Queen Elizabeth II, he therefore has two birthdays, an official one and a real one.

Fair enough – surely all oligarchs can afford to have two birthdays.

In the late 1970’s the family moved from Moldova to Odessa and Mr Tigipko then headed to Dnepropetrovsk and the Metallurgy Institute where (perhaps with the help of a well placed step-father) he became a member of the Komsomol Committee.  In true Marxist-Leninist adherence he busied himself with organising discos and supplying the evils of western decadence – Pepsi.  It appears that a disco-loving Ihor Kolomoisky was a regular and that they became good friends.

(As an aside Mr Tigipko, or more precisely Mrs Tigipko, retain their interest in Odessa in an act philanthropy annually organising and sponsoring the Odessa International Film Festival – which is actually a very good event.)

Indeed Mr Tigipko has had good fortune in meeting business acquaintances, whilst suffering an equally poor fortune in the world of politics.

A few years of questionable military service and teaching intervene before Mr Tigipko lands the role of chief of psyops/reflexive control when he became the Second Secretary of the (Communist) party and Komsomol committees in Dnipro.  Propaganda and agitation commonly being the role of the Second Secretary – a role he was destined to fail at with the date being 1989 and the implosion of the Soviet system only 2 years away.

Nevertheless, having already forged a friendship with Ihor Kolomoisky, it is within the regional Komsomol committee he also meets Olexandr Turchynov (the current head of the Ukrainian national security apparatus and once upon a time, an ardent Tymoshenko ally).

When the Soviet nonsense all eventually crashed, Mr Tigipko had become First Secretary and in charge of the regional Komsomol cash box.  He was also by then known to Gennady Tymoshenko who was head of ideological manipulation for the Kirov District.  Gennady is the father of Alexander Tymoshenko – the unfortunate husband of Yulia.  Indeed it is rumoured that Mr Tigipko played a role in funding Ms Tymoshenko’s video empire back in the day – presumably with Komsomol cash.  Controlling that cash, he also came to the attention of Dnepro Regional Council Chairman, the infamous Pavel Lazerenko.  He had also made direct acquaintance with (soon to be President) Leonid Kuchma and Viktor Pinchuk.

A reader can now literally see the Dnipro Clan forming.

As the Komsomol system was collapsing Mr Tigipko was swiftly given a senior position within Dnipro Bank – no doubt moving to the position along with the Komsomol regional cash.  (There is no reason to believe that events in Dnipro would be any different than those elsewhere in Ukraine at the time when it comes to moving regional Komsomol cash).

Within a year the bank owners were far from getting along well and Mr Tigipko set up PrivatBank with Ihor Kolomoisky, Gennady Bogolyubov, the late Leonid Miloslavsky and Alexie Martynov.  From 1992 – 97 Mr Tigipko was Chairman of the Board of PrivatBank – although what share holding he had will probably never been known.  What is known is that the initial shareholding was not equal.  How much Komsomol/Dnipro Bank cash was used in the creation of Privat is somewhat unclear – and will undoubtedly remain that way.

Meanwhile Mr Kuchma became President Kuchma and Pavel Lazarenko became Prime Minister – leading to a split within the Dnipro Clan and President Kuchma using Mr Tigipko to keep an eye on the out-sized and out of control criminal appetites of Pavel Lazarenko.  He becomes Vice Prime Minister for Economic Reforms in order to carry out that task.

(This move obviously ruffled feathers and PrivatBank came under scrutiny for laundering money via its Riga branch.  Some things don’t change.)

Whilst in post, Mr Tigipko acted as “roof” for the French cement company Lafarge who then had a few issues with assets in Ukraine.  As Bernadette Chirac (wife of Jacques) then sat on the Lafarge board it is perhaps no surprise that Mr Tigipko was awarded French honours personally by Mrs Chirac in 1997.

By 2000 Mr Tigipko wisely quit as the conflict of interests of those around him in the Kuchma government were in all probability intractable at best and very bad for the health at worst.

By 2001 whatever shares in Privat he had were sold for a figure unknown, and he set up on his own with the TAS brand containing banking, insurance, and numerous other interests held under the usual Cypriot holding company  – which today is a beast of many tentacles – and is in fact the reason for this entry.  (Indeed Mr Tigipko sold one of his banks to Swedbank pre 2008 crisis for $735 million via TAS Overseas Investments (Cyprus)).

If business has been good, politics has not been.

Politically Mr Tigipko did not fare well under Viktor Yushenko and Yulia Tymoshenko.  Having chosen the Kuchma side of the Dnipro Clan split, thus backing Yanukovych in 2004/5 elections, that clearly did not sit well with the new “Orange” president, nor a Prime Minister that chose the Lazarenko side of the Dnipro Clan split.

Further when Yanukovych eventually became president in 2010, despite initially welcoming him into the fold, he very clearly and publicly shafted by Mr Tigipko politically.

Lo, tax avoidance aside, it clearly pays in a business sense to hold your assets offshore and in a different legal jurisdiction in a predatory political environment like Ukraine.  It is simply far easier to defend and retain your assets.

Under the current president Mr Tigipko has kept his head down making no discernible political moves and very few business moves.

However, in the past few months Mr Tigipko appears to be going on a spending spree domestically.  Having recently bought another insurance company and rolled it into his TAS insurance entities, it appears he is now entering the hotel business too.

Not only is he entering the hotel business his seems to be doing getting good deals.  For a mere $10 million Mr Tigipko has bought the Radisson Hotel in Kyiv from the Russian owners who for a long time have desperate to sell.

Now a reader may think that the hotel business in Ukraine is not one where returns will be swift – and they’d be right too.  There are no swift returns with anything to do with hotels in Ukraine.  That said, the price paid for this asset being so low, it is possible he will see a 7 year ROI.

However, it may also be that Mr Tigipko has some insider knowledge regarding the return of licensed gambling in Ukraine and any amended parameters regarding what premises can host casinos – and which can’t.   It may well be that the absolute nonsense proposed a year ago for the return of gambling has now had a more sensible eye cast upon it – or is about to have a more sensible eye take a look.

If so, then the Radisson in Kyiv would have additional potential – and a far swifter ROI.  As Mr Tigipko has a knack for good business and poor politics, then who would be surprised if that will ultimately prove to be the case?

More generally, does Mr Tigipko now think that the bottom has now been reached and that the small economic bounce is likely to continue in an upward trend, so now is the time to buy?

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Local elections, the CEC, and political control by proxie – Ukraine

December 18, 2016

December witnesses local elections in several areas in Ukraine.  11th December and 18th December respectively saw voting in newly formed combined territorial communities designed to best leverage local politics (in particular budgets) within “decentralisation” – or so the theory goes.

Clearly at the time of writing the results of 18th December voting is unknown.

Results from 11th December are known.

Yulia Tymoshenko’s Batkivshchyna Party secured 123 local deputies, in part because when it comes to party outreach into local politics Batkivshchyna has always had the best party administrative set up in Ukraine.  No other party can or does come close to Batkivshchyna when it comes to the number of local and regional party offices.

A reader may ponder just how well Batkivshchyna would do if it were actually a real political party if only it could free itself from being nothing more than a political vehicle for Yulia Tymoshenko.  It could then develop some genuine policies that define what the party stands for rather than having to cope with Ms Tymoshenko’s ego, her empty populist rhetoric, and politically expedient flip-flopping.

When it comes to the number of elected deputies, second with 86 came Nash Krai, and Block Poroshenko coming third with 60 elected officials.

As regular readers will know however, Nash Krai is a technical party created by The Bankova (Presidential Administration) to split the Opposition Block (former Party of Regions) vote in October 2014.  This it successfully did and has continued to do.

That is not to imply that Nash Krai is without agency.  It certainly can and does do its own political thing and also votes in the interests of its parliamentarians (not necessarily its constituents) – ergo not always in line with the designs of the President or Government does it vote.  That however is within the parameters expected of a technical party if the facade of independence is to be projected.  When it truly counts support for The Bankova is expected.

However, Nash Krai as a technical party may prove to be problematic in the near future.  It is starting to convincingly out perform Block Poroshenko at the ballot box frequently.  Technical parties also expensive.  Not only does Block Poroshenko require financing, so does Nash Krai.  If finances are diminishing and the electorate continue to swell the Nash Krai machinery via electoral success after electoral success, then sooner or later the tail may start to wag the dog.

That tail wagging dog issue may start in the provinces, but eventually it may reach the centre.  This combined with quality local candidates preferring to run for parties other than that of the president will, by extension, make the next Verkhovna Rada elections interesting.  Even if (or when) state administrative resources are misused by the current powers that be to further their cause, how likely is it that it will be returned the largest party?

For now The Bankova’s pet project (Nash Krai) may remain loyal when required to be so – but for how long?

It is perhaps now necessary to focus upon how well it does vis a vis Block Poroshenko in every electoral vote henceforth, for losing control of the provinces because a pet project goes rouge will have an impact come larger national elections if the decentralised local budgets cannot be abused for the electioneering benefit of those at the centre of power.   Things begin to fray at the edges – and can completely unwind if care is not taken.

(Lo it is no surprise that since new legislation came into force in May 2016, new regional Governors selected by transparent “competition” have all been Block Poroshenko.)

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Further, these elections occur under an illegitimate Central Election Committee.  As noted in an October entry, 12 of the 15 CEC members have long since lost their legal mandates to be part of the CEC.  That elections continue under a clearly illegitimate CEC is no surprise.  (The entry also explains why the current electoral laws are unlikely to change.)

As stated in the aforementioned link – “However, despite any and all the political rhetoric that will surround the CEC issue prior to the year end, it seems extremely unlikely that those who currently compose the current CEC will be changed or be given new mandates.

Firstly the budget and other legislative matters will simply take priority.  Thus it follows that the issue will (once again) be put on the back-burner.  Sometime in early 2017 would appear to be the most hopeful (perhaps even fanciful) time frame when it will be addressed.   Secondly a reader may question any real political desire to actually do anything about changing the current CEC composition, providing doubt that early 2017 is indeed realistic.

As is always the case in Ukraine far too much attention will be given to who is put forward for the CEC positions rather than the institution, its role, and the legislation that it is charged with implementing and overseeing – and that legislation is certainly poor.”

Since that entry was written, the Chairman of the Central Election Committee, Mikhail Ohendovsky is now subject to criminal investigation by NABU (the anti corruption agency).  Thus the “fanciful” early 2017 timeline in the above quote may now be a little more realistic.  With the Chairman subject to criminal investigation and 12 of 15 committee members with mandates that expired in June 2014 it remains to be seen just how much longer this can be willfully ignored.

Thus the usually headline avoiding local elections this December may yet again avoid the headlines – but (local governance and local democracy aside) they act as a timely reminder of increasing reliance upon The Bankova technical party Nash Krai in the provinces by the Poroshenko centre and the prospect of tail wagging dog, and also the potential time frame for dealing with the still willfully unaddressed CEC issues.

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Savchenko in Minsk

December 12, 2016

As much as this blog was going to avoid comment upon Nadya Savhcenko’s meeting in Minsk with the leaders of the “DNR” Alexandr Zaharchenko, “LNR” Igor Plotnitsky, and Russian interlocutors on 7th December, too many emails, private messages and direct messages have arrived asking for comment that careful and limited comment there will be.

Firstly it has to be recognised that daily Ukrainian soldiers still die on the front lines in eastern Ukraine.  It may well be the case that those on the opposite side also suffer daily fatalities, though no figures are announced daily like those of the Ukrainian military.  Also Minsk, a framework document that has failed to deliver anything approaching a ceasefire (where the fire actually ceases) since its agreement more than 2 years ago and thus remains diplomatically alive only in the absence of any alternative – and indeed that alternative may actually be worse than continuing with the sham of Minsk.

However, at the very least, those freed following negotiations under Minsk will not consider the process a complete failure when their very freedom comes as a result.

Nevertheless it cannot be claimed that the process has been anything other than a failure in the eyes of many.

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Having met Nadya Savchenko a few times (the last time in June), with regard to her character of the many insights gleaned, and for the purposes of this entry, it is sufficient to note her strong willed personality – so strong that being an “institutional and/or team player” would clearly be secondary.  These character traits alone, as an entry from May made very clear, are not those particularly welcome within the Batkivshchyna Party.

Those personality traits and the fact that as a parliamentarian she has absolute immunity (and impunity) with regard the law, has the potential for some to be somewhat wary of unpredictable and or predictable but unstoppable acts.  (She can, as all other parliamentarians, do what she likes, when she likes, and without (immediate) legal repercussions until such time as parliamentary immunity is lifted by the Verkhovna Rada or her mandate expires.)

Ergo how and who could stop Nadya Savchenko from going to Minsk (other than Belarus)?

Nevertheless, there is such a thing as party discipline and Yulia Tymoshenko cannot afford to be seen as a weak leader of what is in effect nothing more than a Batkivshchyna Party that is political vehicle solely for promoting Yulia Tymoshenko.

Indeed, of Nadya Savchenko’s Minsk adventure, Batkivshchyna have stated they “consider unacceptable any negotiations with the leaders of “DNR” and “LC” and MP N.Savchenko did not coordinate her actions with the factions and parties, and has recently announced her participation in the new political project.”

That said, she is a member of Yulia Tymoshenko’s Batkivshchyna Party, and has unquestionably gone against the party line that is repeatedly and unambiguously on record.  The “distancing” in the above Batkivshchyna statement is not the same thing as party discipline, nor instigating disciplinary measures within the party for such a blatant departure from the party line.

However, to remove her from the party having been elected upon the party list (as No1 before Yulia Tymoshenko due to populist electioneering when Ms Savchenko was still incarcerated in Russia) opens the way for Ms Savchenko to lose her parliamentary status (as happened to former parliamentarians Mykola Tomenko and Igor Firsov per Article 81 of the Constitution).

The expected and inevitable dilemma for Ms Tymoshenko (foreseen in the May entry linked above) as to just how much she will allow herself (and Batkivshchyna) to be tarred with the undisciplined Ms Savchenko brush once again presents itself.

Dilemma!  What political cost to dealing with Ms Savchenko’s disregard for the party line by disciplinary measures, vis a vis looking weak for not doing so?

Further the SBU is now playing catch up – Yuri Tandit of the SBU making clear that they are now collecting and collating information regarding the Minsk meetings of Nadya Savchenko after the fact.

Nevertheless what’s done is done – and may well happen again (and again).

Ms Savchenko justifies her trip by stating “We must do our best, each of us, to take our heroes home even if we will have to pay those who shoot at us”, saying of President Poroshenko “He, like all of us, wants to pick up our children from captivity and the political prisoners from of Russia.  I am confident that the president on his level of doing everything possible to make this happen as quickly as possible.”

Well fair enough – or is it?

Why shouldn’t she do what she thinks she can?

Putting aside the issue of ugly optics and being seen to be negotiating with the public faces and “leaders” of the “Republics” directly (rather than indirectly and through “channels” as is standard fare, and for good reason of “legitimising” the other parties) there are issues of both her legitimacy and also wider coordination.  (That she has done this at the very least may now make her a “useful idiot” in a wider Kremlin secret service operation.)

And it is perhaps coordination that matters the most.

Ms Savchenko states that she traveled to Minsk on her personal Ukrainian passport and not her diplomatic passport.  Whether or not this is meant to infer a personal and not “official Nadya Savchenko MP” dialogue with the “leaders” of the “Republics” is a matter of perception.  As such, when it comes to framing, were any “negotiations” unofficially official (though they appear unsanctioned officially or tacitly), or were they officially unofficial to which any “negotiation” (whether it may or may not reap results) raises the question of what was “given” and “taken” in that negotiation and the ability, particularly by Ms Savchenko, to deliver thereafter.

Perhaps yet more problematic is that it may well be that this becomes a channel or negotiating format of choice for one side but not the other – thus undermining the negotiating formats that are already accepted and working.  Differences between official and unofficial channels may very well complicate matters further and also be deliberately used to frustrate progress by any party concerned in negotiations when those differences are exploited.  The potential nightmare scenario may arise where with insufficient care and coordination there is a real possibility that due to deliberate, or unintentional, mishandling of negotiations, those detained could be held for far longer than would otherwise have been the case.

If this was indeed a personal pilgrimage (well meaning as it may have been) there are real risks as well as potential rewards as a result.

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Whatever was negotiated and/or agreed may actually be counterproductive to any (or all recent progress) by the officially nominated trilateral groups.  Indeed it may be that an individual uncoordinated effort with such a focus on a specific issue distorts or blinds to the wider negotiating policy repercussions both in the immediate and longer term.

Further, even if Ms Savchenko’s personal and seemingly unofficial interjection delivers any much welcomed prisoner releases, that does not necessarily mean political gains for Ms Savchenko in the long term.  Many of her actions and statements have already raised red flags in some quarters in Ukraine – for her to succeed swiftly where 2 years of negotiations where heavyweights the like the OSCE, Messrs Kuchma and Gryzlov et al have delivered little, may raise as many (if not more) red flags as it would potential voters.

Time will tell how this plays out for Ms Savchenko, how Batkicshchyna (Ms Tymoshenko) deal with this, how much the SBU and the official negotiators will learn of the “negotiations” (and as importantly the resulting interpretations of all those present), and perhaps most critically for those already working so hard to release, whether there will be results within the parameters they have been asked to remain within.

Perhaps, considering the high profile Ms Savchenko has, what a reader may ponder most is that if Ukraine felt she was the most suitable of people to be directly involved in such negotiations then she most certainly would be – and that she isn’t may well say all that needs to be said.

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The CyberJunta hack – How will the populists respond?

October 24, 2016

CyberJunta, one of the Ukrainian hacking groups has apparently (and unsurprisingly) targeted Vladislav Surkov and an email address v14691@yandex.ru purported to be used by him under the pseudonym Nikolay Pavlov.

Also compromised was an email address of a Surkov associate/underling pabnik@yandex.ru used by Pavel Karpov.

Within the documents thus far released in two pdf files file-1 and file-2 – 17.4 MB in total (with more to come undoubtedly) it has to be said there are absolutely no surprises when it comes to the tactics and instruments to be used in undermining Ukraine beyond the occupied Donbas.

Neither would the suggested time frame between November 2016 to March 2017 for implementation of destabilisation within Ukraine come as a surprise to many.  Events both external and internal of Ukraine would dictate this period as being optimal.

Clearly fermenting social unrest during the heating season when tariffs have risen so sharply requires little tactical thinking within the Kremlin when Ms Tymoshenko long-since grasped that opportunity – and she has been banging the social unrest drum for several months over the issue.

Forcing/encouraging new Verkhovna Rada elections in Spring 2017, something long anticipated, is another goal that would fit the Opposition Block, Batkivshchyna/Tymoshenko, and possibly Radical Party design.  As all are populist, if they cannot force early elections following the hardship many will face during a heating season of high tariffs then they will probably never manage to force early elections.

Plans attempting to bring about calls for a “federal Transcarpathia” are an obvious alternative to the failed Novorossiya project.  (Although not specifically mentioned, how great a role Viktor Orban would/could play in agitating the Hungarian diaspora is unknown.)

What is perhaps most informative about the documents is that Mr Surkov aka Pavlov (if the email address is genuinely one of Surkov’s pseudo-email addresses) is that it is not the most Kremlin friendly Opposition Block that is identified as the critical political machinery to push the Kremlin active measures within the Ukrainian constituency.  Neither is it the Radicals.

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The main focus was/is to concentrate upon the Batshchivyna (Ms Tymoshenko’s) Party.  This because it has the best outreach/network throughout Ukraine of the 3 political parties identified that would/could dance to the Kremlin tune – wittingly or unwittingly.  It is indeed true that of the Oppo Block, Radicals and Batkivshchyna, the latter has by far the widest regional networks.

The obvious question is whether Ms Tymoshenko would willingly allow her (and it is hers and nobody else’s) party to be used to further Kremlin active measures?

If so, wittingly or unwittingly?  (And would it matter either way when it comes to issues of implementation?)

A reader is left to ponder the morality (or not) of Ms Tymoshenko and the integrity (or not) of Batkivshchyna in pursuit of its vision for Ukraine even if it meant becoming a covertly willing accomplice of Mr Surkov/The Kremlin.

To be blunt, that Batkivshchyna vision probably goes no further than Ms Tymoshenko ruling Ukraine, for there is nothing whatsoever offered by way of detailed policy (as a reader would expect from a populist) and to be frank during her nearly 20 years in Ukrainian politics, meaningful and credible policy is not something that Ms Tymoshenko has ever actually offered (let alone delivered).  Her political judgement is also somewhat suspect, for despite many years involved in grubby deals with The Kremlin/Gazprom whilst in control of UESU and Somoli Ent, she still managed to hand Ukraine the most punitive gas deal in its history in 2009.

Whatever the case, how does Ms Tymoshenko and Batkivshchyna, (notwithstanding the Radicals and to a lesser extent the Opposition Block of whom such cooperation would be expected) mitigate the revelations within the apparently hacked emails detailing Kremlin plans as authored by Mr Surkov/Pavlov?

If denying (perhaps rightly) any political activity coordinated, or even useful to The Kremlin, the fact of having been identified as the political parties most likely to further Kremlin active measures to undermine Ukraine is a rather damning frame to be placed within.

Ms Tymoshenko/Bakivshchyna (and the others) may try to label CyberJunta a presidential provocation, but that carries risks – particularly if it is not, for hacker retribution is unlikely to be kind.  Batkivshchyna (or other named parties) emails becoming public is probably not a something that would be appreciated (unless you are employed within the Presidential Administration or are a Deputy of the People’s Front), nor is it likely to contain nothing but wholesome morally upstanding text and thoughtful policy alternatives.  Scams and scheming may well dominate any correspondence, be it party or personal in nature.

To be effectively labeled The Kremlin’s best ally/option in destabilising Ukraine, wittingly or unwittingly, within allegedly Kremlin designed active measures takes some explaining even if the entire incident is a fake – for unfortunately for Ms Tymoshenko and Batkivshchyna (and more or less the entirety of the political class more broadly), anonymous pro-Ukrainian hackers probably have as much, if not more credibility with the constituency than she does.

How to respond with the minimum of political damage sustained?

If it is a fake (or parts therein are fake), then who is responsible?  The Bankova or People’s Front?  It is doubtful it was a joint project.  If not either of those two, who else benefits?

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Trickle down culpability – An Odessa case to watch

October 18, 2016

A reader may ponder quite rightly just how many letters Prosecutor General Yuri Lutsenko receives directly requesting him to do his part in upholding the law.

However many he receives, he can now add one more to the list – a letter from Invest Group in Odessa, part of which reads “In view of the above employees of the company Invest Group refer to you as the head of the Prosecutor General’s Office, which seeks to protect human rights, the interests of society and the state, with a request to protect our employees against threats and attacks on the part of Mr. Dubov AF.”  

In short a public and direct appeal to Yuri Lutsenko not to continue to turn a blind eye to raider attacks by Mr Dubov (and associates) – please do your job!

The problems for Yuri Lutsenko continue to mount, for his undoubted return to politics (and at a minimum with a Cabinet position) rest heavily upon actually being perceived as a Prosecutor General that actively went after the elite and put more than a few in jail.  That necessity will eventually bring him into conflict with President Poroshenko who thus far has presided by way of managing elite interests, striking grubby deals, and insuring that none of the elite actually go to jail – at worst to be found guilty in absentia.

Whilst “trickle down economics” may be a commonly known phrase to many, “trickle down culpability” is how anti-corruption is currently to be perceived in Ukraine.  Those at the bottom of the “trickle down culpability” pyramid however, are hardly set to benefit in either theory or practice.

This particular Invest Group case however, is somewhat interesting for it involves a man with no legitimate immunity, who is unambiguously connected to the very top of the Ukrainian elite yet politically toxic, and is nothing short of a professional “raider” of businesses.

Thus there are local complainants, a local structure that simply fails to control his well known nefarious deeds, a local infrastructure that acts on his behalf/defends his actions, and an elite connection that is undeniable yet intangible – whilst he is without any of the immunity complications associated with actually arresting him.

Before going any further, a few lines about Mr Alexander Dubov are perhaps in order – for most readers will have never heard of him (even if they live in Ukraine).

Mr Dubov hails from Odessa Oblast.  He finished medical school and also holds qualifications in law from Odessa National Academy.  Upon completion his mysteriously managed to land some highly placed positions in the southwest of the Oblast immediately.  For example he promptly became Deputy Director of Dombudkonstruktsiya near Ismail.  Time spent on the borders of Transnistria was not wasted and it is claimed/known that he became a major player in cigarette smuggling during the mid to late 1990’s.  He also became the Deputy Director (of General Affairs) for the Christian Charitable Foundation Trust until 2002/3.

“Foundations”, “trusts” and “charities” were/are a prerequisite for those with sullied reputations but who have political ambition – and political ambition Mr Dubov had (and still has).

He became a Deputy Director of an entity called the Ukrainian Investment Group which sometime around 2005/6 came into contact with an entity called International Investment Group.  International Investment Group was then led by Alexander Yanukovych, the eldest (and wanted) son of former-President Yanukovych.

A reader will therefore be able to predict the increased profitability and infamy of Mr Dubov within certain circles once a relationship with Alexander Yanukovych developed.

Indeed in 2007, when then President Yushenko was juggling Prime Ministers and minions of both Yanukovych and Tymoshenko sallied forth across the land offering MP mandates for $5 million for those interested and deemed appropriate/came with recommendation (with an expected return of quadrupling that investment during a parliamentary mandate – or such was the return offered to this blog when asked in 2007 if for $5 million a seat in the Verkhovna Rada would be of interest), Mr Dubov entered the Verkhovna Rada under the Batkivshchyna (Tymoshenko) Party label.

Whether or not he got a discount on the $5 million joining/mandate fee who knows – but assuredly it will have cost several $ millions for that mandate if offered the same deal that this blog was offered at that time.

Naturally, having now reached the Verkhovna Rada Mr Dubov also set up his own charity, “Foundation for Goodness and Love”.  It was the done thing and nothing unusual.  Such entities are particularly useful when it comes to voter bribery/coercion.

Once in the Verkhovna Rada Mr Dubov set about work in the font of all fonts of corruption and nefariousness – energy and nuclear power.  He became closely associated with Alexander Turchynov, the current Secretary of the National Security & Defence Council of Ukraine.  Mr Turchynov was at the time one of the staunchest of Tymoshenko loyalists.  Mr Turchynov appears to have ably assisted Mr Dubov’s parliamentary career – and with it access to numerous machinations and nefarious schemes.  Without listing them all, scams are alleged to have included the food budget for prisoners (presumably resulting in hungry prisoners), drug procurement, and (an on-going per the opening paragraphs) count of close to 100 corporate raids – mostly in Odessa, but not exclusively.

In 2012 his second term in the Verhovna Rada began (District 64, Odessa) in what must have been an extremely expensive voter bribery and/or coercion campaign.  At the time of “peak Yanukovych”, a Batkivshchyna MP from Odessa with a reputation as thoroughly sullied as his won fairly?  Clearly the previous Verhovna Rada “returns” during his first mandate, plus almost 100 corporate raids upon profitable companies provided for such expensive electoral funding.

What is perhaps somewhat unique about the corporate raiding conducted by Mr Dubov is that no entity seems to have survived once his eye (or the eyes of others for which he would ply his expertise) has been taken with them.  There is also a level of consistent brutality and brazenness about these corporate raids that set them apart from others.

Naturally not all spoils were (or are) retained by Mr Dubov.  He had (and has) patrons within the Verkhovna Rada to which tribute is necessarily paid.  Indeed rumour has it that he earned sufficient trust that during the immediate aftermath of the Yanukovych regime flight and the subsequent high positions of his patrons, that he became one of the “purses” for certain temporary highly placed political figures to re-route State funds through.

Dubrov, Yatseniuk, Tymoshenko Y, Tymoshenko E

Dubrov, Yatseniuk, Tymoshenko Y, Tymoshenko E

The “Revolution of Dignity” was not altogether rewarding for Mr Dubov however – even if you do get to stand next to Ms Tymoshenko upon her release before a less than enthusiastic crowd.

The subsequent Verkhovna Rada elections of October 2015 saw him lose his single mandate parliamentary seat and he was deemed simply to odious a figure to feature highly on any Batkivshchyna Party list in the post-revolutionary atmosphere.  Those with a public persona for thuggery, corporate raiding and extortion were swiftly distanced whilst new unsullied civil society and journalism people were actively sought – notwithstanding persistent and ugly inferences to his involvement in the preparations (and aftermath) resulting in the 2nd May tragedy in Odessa.

Mr Dubov is not man without political creativity, even if he is a brutal one.  Because political doors were/are closed due to the political climate (they may reopen), he toyed with the idea of heading the Chamber of Commerce instead.  After all, a degree of power is there to be had, and so are the invitations for drinkies and a canapes with ambassadors, economic and trade attaches, as well as foreign business leaders.  Unfortunately the Ukrainian leadership managed to grasp the prickly politics of placing a professional and notorious corporate raider as head of the Ukrainian Chamber of Commerce (although a reader will doubt they would otherwise have understood the irony).

Nevertheless, the core business of (professional) corporate raiding continues as Invest Group’s very recent letter to the Prosecutor General makes abundantly clear.  This despite Mr Dubov having been nudged into the shadows of political expediency and therefore can no longer hide behind parliamentary immunity.

With immunity gone, why then does he continue to act so brazenly and implied impunity?

As any occultist will say “As above, so below”.  If Ms Tymoshenko, Alexander Yanukovych and Mr Turchynov (among others) have all been (and perhaps still are) the “above” – then who and what constitutes the “below”?  Corporate raiding is a “dark art” in Ukraine after all.

If persistent and informed whispers are in any way accurate, then the exact construction of that local protection is divided between the political and the legal.  It would perhaps, if whispers be true, compromise politically of Messrs Krotyk, Kmyrenko, Shyvalov, Shamilov, Deide, Lutsenko (I), and Ms Syslova and Kuzel, whilst influencing the legal would be Mr Babenko, Mr Mazark with the SBU, the police and prosecutors by Mr Podolev, and Mrs Podoleva the courts.

It must therefore be clear to a reader why Invest Group have decided to circumvent the local system and appeal directly and publicly to the Prosecutor General when faced with yet another corporate raid by Mr Dubov (via a shell company called Naster registered in Lithuania if Mr Lutsenko needs a place to start and work back from).

A reader may question whether the Invest Group corporate raid is an act of Mr Dubov alone, or whether it done on behalf of others?  If so which others?  Alexander Yanukovych?  NSDC Secretary Turchynov?  Ms Tymoshenko?  Others from his Batkivshchyna history?   Perhaps the acts occur on behalf of yet others?  He is certainly skilled at what he does.  His reputation is earned.

The sensitive issue of how well acquainted Mr Dubov is with the Attorney General who was also a Batkivshchyna loyalist renowned for grubby deals behind the curtain during Mr Dubov’s two terms as a Deputy from the same party also arises.

How does Attorney General Lutsenko now act upon receipt of this letter?  It is not a case that will get any diplomatic attention (unless the diplomats that read this blog now take it under observation).  It is a case that can be easily ignored should he chose to do so – or at least act so slowly as to be too late to prevent the successful conclusion of the Invest Group corporate raid.

If he has any conflicting interests, who does he pass this off to?

If he (or President Poroshenko) want a big scalp in Odessa, and one which is also well known within the national elite circles, does the currently politically toxic and immunity-less Mr Dubov provide for something approaching a significant anti-corruption/business friendly conviction whereby the current “trickle down culpability policy” does not necessarily have to trickle down very far?

Although this case will probably get little by way of attention, it is perhaps one that should be watched as something of a bellwether simply because it presents overt political opportunities unhindered by issues of immunity that can provide publicity regarding successful anti-corruption, criminal action and bettering the business environment- or not.

Attorney General Lutsenko’s response is awaited.

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Populist political guns aim at Gontareva (and the NBU)

October 17, 2016

With Ukraine no longer being dependent upon the IMF, and with international debts to be serviced more than manageable in 2017, it is perhaps no surprise that the current head of the National Bank of Ukraine (NBU) is now a legitimate political target when it comes to taking a scalp from the President.

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Thus, during the week 6 – 10 October at a meeting of the IMF and World Bank in Washington DC, a brochure was circulated with the clear intention of undermining Ms Gontareva as head of the National Bank of Ukraine.

Behind the brochure sits Sergei Taruta – Verkhovna Rada parliamentarian, businessman and oligarch.

To be entirely blunt, having only recently met with senior people within these institutions in Ukraine, if the intention was to undermine Ms Gontareva (and/or the NBU policies) then it was sure to find little if any traction at the meeting of these international institutional lenders.

Whilst neither institution support specific politicians or institutional appointees (like Ms Gontareva), instead supporting State institutions and internal processes, quite clearly both fully recognise what they consider to be very positive change within the NBU under her leadership.  It seems unlikely that there would be any private conversation that would encourage her removal from office until the changes she has brought are far more consolidated and (perhaps) irreversible.

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It is therefore difficult to believe that Sergei Taruta could seriously expect that a brochure clearly designed to undermine the head of the NBU would find traction among the IMF and WB elite in Washington DC.

If he did then he has a truly woeful understanding of the relationship between the current NBU management and that of the IMF and WB in Ukraine.

Needless to say, the brochure brought with it no result at the IMF and WB gathering in DC that was in any way helpful for Mr Taruta – perhaps the opposite.

Nevertheless on 14th October Mr Taruta decided to pursue to resignation of Ms Gontareva through the machinery of the Verkhovna Rada, declaring on his intentions on his Facebook page together with accusations of incompetence and corruption.

That same day the NBU website questioned the allegations, the framing of his claims, and the motivations of Mr Taruta.  Indeed the NBU requested that such machinations be scrutinised by the Ukrainian law enforcement entities.

A reader will now rightly note the true audience – that of the Ukrainian constituency.

Not to be left on the periphery, on 17th October, the ever populist Yulia Tymoshenko pushed Batkivshchyna to the fore as a rallying point for Verkhovna Rada Deputies to coalesce around to force the removal of Ms Gontareva.  Ms Tymoshenko’s main charge being that Ms Gontareva is in charge of the destruction of the State at the behest of President Poroshenko.

Her secondary charge, and clearly she has noted the real reason for Sergei Taruta’s attack on the NBU, was that the free-floating (more or less) of the Ukrainian currency has caused all those with foreign currency loans to struggle and/or default as the currency weakened significantly when finding its true market value.

Thus Mr Taruta’s attempt to attract struggling SME’s and entrepreneurs to the Taruta political sphere is now duly challenged by Ms Tymoshenko’s act – whilst both simultaneously attempt to remove a presidential appointed (Verkhovna Rada approved) scalp who is now fair play having completed many of the most unpopular IMF reforms.

Perhaps Ms Gontaerva is incompetent and/or corrupt as Mr Taruta claims.  Perhaps she is President Poroshenko’s tool for the destruction of the State as Ms Tymoshenko orates.  If so however, neither Ms Tymoshenko nor Mr Taruta have the moral high ground nor are particularly concerned about it considering the company they keep and the activities of those within their orbit – both business and political.

It is far more likely that they both simply see the IMF as now expendable and thus Ms Gontareva as no longer essential/untouchable – and therefore she is nothing more than a possible scalp for a populist “win”.

If they managed to remove her, would State policy change?  Probably not.

 

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Tymoshenko and the IMF – or is it really about the IMF?

September 21, 2016

Yulia Tymoshenko knows a thing or two about dealing with the IMF.  She has said so herself on several occasions when recently cricitising first former Prime Minister Yatseniuk, and latterly the current Prime Minister, Volodymr Groisman.

Indeed when Prime Minister she negotiated a deal with the IMF, the conditions to which she agreed she then reneged upon when required to implement them – which may make a reader wonder just how skilled at negotiation with the IMF she really is.  (If one instance of poor negotiation is not enough, then a reader may reference the gas deal she struck with The Kremlin resulting in the worst gas deal with Russia in Ukrainian history, (despite the welcome removal (visible) of intermediaries), is also worth pondering.)

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Ms Tymoshenko apparently knows what the current IMF conditions are according to a report by Interfax – “Among Ukraine’s obligations are the cancellation of the moratorium on the sale of agricultural land.  If the moratorium is not prolonged, Ukraine will lose its main resource.

She claimed that the IMF also planned to “virtually introduce external control over national, state Ukrainian banks.”  as well as seeking commitments to reduce the network of Ukrainian educational institutions.

So far, so standard regarding IMF conditionality just as the hiking of utility prices has long been a standard IMF demand – and the demand that she balked at when it was her turn to implement the IMF agreement she agreed that also included utility hikes.

The IMF has been fairly consistent with its requirements with every Ukrainian government that has negotiated with it – from gas pricing, to the funding of vast number of universities within the nation, to lifting the moratorium on the sale of agricultural land, there is really nothing new in her “revelations”.

Indeed the only thing new about the IMF demands this time is that both Prime Minister’s Yatseniuk and Groisman have more or less honoured the obligations they have entered into – unlike Ms Tymoshenko when it was her time to do so.

What catches the eye is this statement – “The nationalization of large Ukrainian private banks is foreseen. We want to know what the bank is, what the date of nationalization is and who will be responsible for the obligations the banks have to Ukrainians”.

Clearly she is referring to Ihor Kolomoisky’s Privat Bank.  A bank which is structurally critical to the current operation of the Ukrainian banking system, but that is otherwise bankrupt and has been for years.  This situation too, is no secret to anybody.

Indeed the nationalisation of Privat is unlikely to create too many issues for Ihor Kolomoisky given its otherwise bankrupt status.  He may well realise that if he can get rid of it now, it will save some severe and problematic issues in the not too distant future.  (The health of Ukrainian Airways (MAU) another Kolomoisky company is worthy of a look too for those interested in the Kolomoisky empire.)

Privat Bank, its condition and structural importance would of course raise flags for the IMF when considering the robustness of the Ukrainian banking system.

The question Ms Tymoshenko is really asking is what, if anything, Ihor Kolomoiskhy gets out of the deal on his side, and what the current leadership get (themselves) if the State nationalises Privat Bank removing this impending problem for Ihor Kolomoisky and also easing concerns within the IMF?

Do Mr Kolomoisky (and partners) retain any minority shares?  What about the high value loans heavily biased to other Kolomoisky companies and their ability to repay them – or not?  Are profitable bits of Privat (card payment infrastructure etc) to be split off, and if so who will own them and reap the rewards?  Who would be the negotiator with Ihor Kolomoisky if not President Poroshenko, the only person Mr Kolomoisky would negotiate with?

What reward does President Poroshenko personally desire from any such negotiations that ultimately remove a problem for Mr Kolomoisky?

The answer to that, if strong and repeated rumour be true, is a majority share in Mr Kolomoisky’s top rated TV station 1+1.

The President has one eye on his woeful popularity figures, and another eye on Presidential elections in just over 2 years time.  A 1+1 favourable editorial line toward President Poroshenko would be gratefully received and the only way to insure it with a sly character like Mr Kolomoisky is to own the majority share of 1+1.

1+1 together with the President’s Channel 5, and perhaps the fairly amenable (read rentable/for hire) Vadim Rabinovich and Evgen Muraev with NewsOne, will form a fairly solid national TV media platform from which to launch a presidential campaign for a second term – notwithstanding the administrative ability to throw a few policy sweeteners to the constituency and a few fairly big fish into the judicial frying pan if and when necessary – all with the timeliness associated to pre-election electioneering rather than official electioneering.

If this be the case, how does President Poroshenko buy a majority share in 1+1 when his business activities are now supposed to be run through a blind trust?  Is the trust blind in only one eye?  Will a trusted third party do the 1+1 (plausibly deniable) honours on behalf of President Poroshenko?

Will Mr Kolomoisky accept President Poroshenko saving him from serious banking problems/liabilities at the expense of control over the influential 1+1?  It is a question, according to rumour, that is still being pondered.

With Inter (if it is still operating and belonging to Dmitry Firtash) being an Opposition Block TV platform, the question in Ms Tymoshenko’s head perhaps is not what happens to Privat, but undoubtedly being aware of the persistent rumours surrounding the deals around what happens to Privat, is where she will find a national media platform that could compete.

Unless Ms Tymoshenko is entirely deaf to rumours circulating within her workplace, she already has a good idea of the answers to all the other questions – as do a lot of other people.

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