Is Ukraine Finally Tackling Corruption and Russian Influence?

by Jim Dornan

In my October 15, 2021 interview with David Kamioner of Lifezette (https://www.lifezette.com/2021/10/ukraine-reports-could-further-ensnare-biden/), I chose to focus on President Biden's recent meeting with Ukraine's leader, its longer term implications, and Ukraine's uncertain future as a nascent democracy and our ward and ally that has been in constant struggle with the culture of corruption inherited through its Soviet colonial shackles. What follows is a further commentary.

One of the main topics the two heads of state discussed was Ukraine's ailing economy and corruption. This was expected. It was also not a surprise that Biden and Zelensky talked about Ukraine's abuses by the hands of its oligarch class, dwindling and exaggerated by way of its wealth, it is driven by desperation and avarice of the few remaining mega influencers. What was unexpected was that Ukraine's president would actually do something tangible. Then, in a surreal series of moves, President Zelensky decided to finally fight corruption – not through rhetorical platitudes of his predecessors, but with an iron fist.

Zelensky's administration has published a list of 557 individuals who are no longer welcome in Ukraine; most of them are gangsters, Thieves in Law, and "criminal authority" figures with street credits earned in Russian prison camps. This move is reminiscent of President Saakashvili's clean-up of Georgian gangsters when he first took office. In similar fashion, President Zelensky, in an effort to purge the remnants of the deposed former President Yanukovych's mafia-state, continued to clean house by levying sanctions on the worst offenders.

Zelensky's administration began challenging not only gangsters, but also corrupt tycoons and bureaucrats, and Russian provocateurs. This is good news for President Biden and Europe since Ukraine was envisioned as a noble experiment in democracy, and a strategic ally of the free world, promising to become a formidable economic partner – if only it can curb its corruption state.

A press conference held on Friday June 18, 2021, featuring the chair of the National Security and Defense Council (NSDC), announced the designations of Ukraine's greatest abusers. Two individuals on the list are allegedly tied to Russian businesses, corruption schemes, criminal syndicates, and Russian counterintelligence.

One, Dimitry Firtash, a billionaire, is a well-known Ukrainian oligarch currently in Austria fighting extradition to the U.S. after posting bail in excess of $150 million. Firtash is charged in the U.S. with orchestrating a corruption scheme to acquire ore deposits in India. He made his fortune mostly in natural gas and has also been implicated in efforts to influence the Trump White House through Trump loyalists.

Firtash once attempted to buy and redevelop the famous Drake Hotel in New York along with the now-pardoned former Trump campaign manager Paul Manafort. Ukrainian anti-corruption activists and Western governments generally regard Firtash as Russia's influencer in Ukraine, similar to another Ukrainian oligarch and President Putin's tacit "emissary" in Ukraine, Viktor Medvychuk, who has also been subject to sanctions by Zelensky's government. It is alleged that Firtash provided key documents that Rudy Giuliani used to further his now discredited claim that President Biden engaged in wrongdoing in Ukraine.

The other, Pavel Fuks, is a disgraced former builder who fled from Russia as his development projects collapsed, giving way to lawsuits, investigations and criminal charges. Mr. Fuks, known in Russian gangland as the "Mercenary" is alleged to have seized toxic former President Yanukovych oil and gas assets, Golden Derrick and Ukrneftebureniye or Укрнефтебурение in Russian. The latter, where the Mercenary holds a 23% interest according to open sources (including FOCUS Magazine which ranked the Mercenary as #94/100 wealthiest people in Ukraine) owns oil and gas fields in the city of Kharkiv. The other owners of the lucrative oil and gas fields are alleged to be controlled by Ukrainian Oligarchs Igor Kolomoyski and Vitaliy Khomutynnik.

Mr. Fuks has been a Russian citizen, but recently made dubious claims that he renounced his Russian citizenship. Mr. Fuks has been colorfully labeled in a recently filed scandalous civil suit by an American lawyer and Washington insider with deep GOP connections. A GOP mega-bundler hailing from California, Yuri Vanetik, allegedly agreed to help Fuks attend Donald Trump's inauguration. According to public filings, Vanetik disputes Fuks' allegations, but leveled some of his own against Fuks, who Vanetik claims wasn't even his client. Instead, Vanetik declares that his real client was one of the richest and most secretive politicians in Ukraine, Vitaliy Khomutynnik; Khomutynnik apparently isn't complaining about his visit to Washington 4 years ago. Khomutinnyk has ties to controversial Oligarch Igor Kolomoyski, the notorious, deposed Yanukovych regime and its Party of Regions. Now Khomutynnik is President of the Ukrainian Golf Federation and runs a venture capital fund called Cascade (https://ifcascade.com/). This mystery inauguration guest is also former chair of the Ukraine Parliament Committee on Taxation and Customs Policy and Committee on Financial Policy and Banking.

Vanetik sued Fuks for racketeering, demanding a whopping $255 million in damages. The Vanetik lawsuit is a 40-page missive about how Fuks allegedly graduated from being a human trafficker and an errand boy for Russian gangsters to snitching, murder and money laundering and invokes the RICO statute (Racketeer Influenced Corrupt Organizations). The graphic complaint further alleges that the Mercenary put a contract on Vanetik either for not getting him front row seats at the inauguration or for causing Fuks' U.S. visa to be revoked. Vanetik seems to deny Fuks' allegations in their entirety.

After his falling out with Mr. Vanetik, Mr. Fuks wasted no time and turned to Rudy Giuliani with most likely the same agenda – to access Donald Trump and

develop ties within our government. With Vanetik, Fuks' pretext may have been attending inaugural events for his wealthy Ukrainian friends; with Giuliani, it was an arrangement to assess emergency operations for the city of Kharkiv. It is rumored that the Giuliani relationship also soured for Fuks, and although he did not dare to sue or threaten Mayor Giuliani, he allegedly attempted to stiff the Mayor on what he owed him and referred to America's Mayor as Kharkiv's lobbyist, a claim which Giuliani denies. Presently, Mr. Fuks is actively involved in a fight for control over the city of Kharkiv, the second largest city in Ukraine, Mr. Fuks' deceased patron, Gennady Kernes, held court as an authoritarian mayor. We shall see if President Zelensky's administration stands idle while Mr. Fuks and his cohorts wreak political and financial havoc in Kharkiv.

By observing the recent Ukrainian sanctions levied on the likes of Pavel Fuks and Dimitro Firtash, we can see that Ukraine is finally deploying effective measures to curtail Yanukovych-era corruption and Russian influence. President Zelensky has finally determined that appeasing the Oligarchs is a strategy destined to fail. Hopefully, President Biden will take notice after the dust settles and help President Zelensky continue his efforts to salvage his country's economy and its people's dignity.