(c) Reuters. Ihor Kolomisky, a Ukrainian billionaire and businessman, arrives in court during Russia’s invasion of Ukraine on September 2, 2023. REUTERS/Vladyslav Musiienko
By Olena Harmash and Tom Balmforth
KYIV (Reuters) – A Ukrainian court ordered tycoon Ihor Kolomoisky to be held in custody for two months on suspicion of fraud and money laundering on Saturday, a striking move against one of the country’s most powerful businessmen.
The detention of Kolomoisky, who is under U.S. sanctions and is a one-time supporter of President Volodymyr Zelenskiy whose election he backed in 2019, comes as Kyiv is trying to signal progress during a wartime crackdown on corruption.
Defence lawyers said Kolomoisky would appeal the ruling, questioning its legality, but that he would not post bail of almost $14 million in order to secure his release, broadcaster Radio Liberty reported. After a hearing in Kyiv’s district court late Saturday night, Kolomoisky was seen being led out in a blue tracksuit. He is one of Ukraine’s richest men. He was not available for comment. The agency said in a statement that it was established that between 2013-2020, Ihor Kolomoisky legalized more than half a billion hryvnias ($14 million) by withdrawing them abroad and using the infrastructure of banks under his control.
“It was established that during 2013-2020, Ihor Kolomoisky legalized more than half a billion hryvnias ($14 million) by withdrawing them abroad and using the infrastructure of banks under (his) control,” the agency said in a statement.
After the ruling, Zelenskiy appeared to allude obliquely to the case in his evening address, thanking law enforcement agencies for showing resolve in bringing long-running cases to justice.
“Without a doubt, there will be no more decades-long ‘business as usual’ for those who plundered Ukraine and put themselves above the law and any rules… He said that the law must be enforced.
Kolomoisky is seen as one of the class of oligarchs who amassed huge industrial wealth after the 1991 collapse of the Soviet Union and wielded outsize political and economic influence.
Before Russia’s February 2022 invasion, Zelenskiy and his team passed legislation requiring oligarchs to register and to stay out of politics. The war has eroded the oligarchs’ power as industrial assets have been destroyed in the east and south, and their television channels have been broadcasting under a centralised signal.
Before winning the presidency, Zelenskiy rose to prominence as a comedian and played the role of president on a show aired on a Kolomoisky-owned TV channel. He denies Kolomoisky had any influence on the government.
During the war, Zelenskiy has emphasised Ukraine’s crackdown on corruption as Kyiv has applied to join the European Union and hopes to secure tens of billions of dollars to help rebuild the country after a war which has no end in sight.
Kolomoisky’s detention is not the first wartime move involving him. Invoking wartime legislation, the government took over stakes in strategic companies that were partly owned by the businessman in November last year.
Earlier this year, security officials searched Kolomoisky’s home in connection with a separate investigation into embezzlement and tax evasion at the country’s two largest oil companies partially owned by him.
Kolomoisky is a former owner of leading Ukrainian bank PrivatBank, which was nationalised in late 2016 as part of a clean-up of the banking system.
He has owned assets in the energy, banking, and other sectors, including an influential television channel. The United States imposed sanctions against Kolomoisky by 2021, “due his involvement in significant corrupt practices”. The United States authorities also claim that Kolomoisky, along with a partner in business, laundered stolen money through the United States. Kolomoisky has denied any wrongdoing.
($1 = 36.5686 hryvnias)