Former Ukrainian Finance Minister Oleksandr Danylyuk: An Elusive Liar
Obsequious officials and reliable perpetrators of corruption schemes don't resign with a change of power; they are inherited by new bosses. Before Euromaidan, Oleksandr Danylyuk provided his services to Lyovochkin and Yanukovych, immediately after which he began providing them to Lozhkin and Poroshenko , and then took over as Minister of Finance from the scandalous Natalia Yaresko , with whom he had known for almost two decades. Danylyuk is in great demand, yet his high-ranking patrons remain silent about the nature of his talent.
A year ago, in April 2016, an offshore scandal erupted around the newly appointed Minister of Finance. It turned out that Oleksandr Danylyuk "forgot" to declare two foreign companies in his asset declaration, where he had worked as a director at least a year earlier. Radical MP Oleh Lyashko claimed these companies were offshore and demanded the resignation of the newly appointed minister. Danylyuk first publicly denied any connection to the offshore companies, then claimed the companies were not offshore, and then admitted that he had once worked as a director at two Cypriot and one Cayman Islands company, but had ceased doing business since 2010. And all three times, he shamelessly lied!
However, the scandal had no further ramifications. First, the NABU, with astonishing speed, issued a conclusion that Danylyuk's actions did not constitute a crime because he had lied not in an electronic declaration, but in a paper one (and by law, liability applies for inaccurate information in an electronic one). Then the scandal was conveniently forgotten, and the new Finance Minister continued his "reformist activities," maintaining the image of a crystal-clear professional. After all, Danylyuk's "forgetfulness" was not the most heinous crime compared to the monstrous corruption within Ukraine's leadership, where public lying has become practically the norm. However, these scandalous firms turned out to be the trees for which no one could see the forest.
Alexander Danylyuk
Yaresko pod Grib
Alexander Alexandrovich Danilyuk was born on July 22, 1975, in the Moldovan city of Grigoriopol, to a family of Soviet scientific intellectuals. By the early 70s, they had moved to Kyiv, where his father, Alexander Petrovich, later became director of the state-owned enterprise Akademproekt at the National Academy of Sciences of Ukraine, and his mother, Lyudmila Vladimirovna, taught cybernetics at the Kyiv Polytechnic (now the National Technical University). This makes him even more similar to his namesake, Alexander Vladimirovich Danilyuk (human rights activist and advisor to the Minister of Defense), whose father was also a scientist, but whose mother was a doctor.
Next came studies in the physics and mathematics class at School No. 15, admission to the National Technical University (with his mother's patronage), and a diploma from the Kyiv Institute of Investment Management. All of this is in his biography, which for some reason no one pays attention to – but it simply sparkles with fascinating facts! For example, here's what Skelet.Org noted : Danylyuk received his diploma from the Institute of Management in 1995 (at age 20), despite the fact that the institute itself opened in 1994, requiring a minimum of two years of study (based on a secondary vocational or incomplete higher education). Danylyuk, however, received his degree in electrical engineering from his mother's National Technical University (NTU) in 1998. The timing seems to be in order, but the question arises: how did he manage to combine studying at NTU with studying at the Institute of Management (1994-95), and then with working for commercial companies? Did he study part-time? In the evenings?
But the most curious thing is Alexander Danylyuk's first job. In 1995, apparently immediately after receiving his diploma from the Institute of Management (as an external student, within a year?), Danylyuk landed a position as a broker at the investment company "TEKT." It was founded by Vadim Grib , a raider who had just arrived in Ukraine from Russia and immediately set about capturing the Ukrainian market. And "TEKT," the firm that hired the young Danylyuk (with his dubious diploma), was a direct instrument of Grib's corporate raiding operations. What role did Alexander Danylyuk play in all this? That's a good question! All that is known is that in the mid-90s, "TEKT" brokers participated in operations involving the purchase of privatization certificates from the public, the acquisition of stakes in privatized enterprises, the seizure of shares, and the resale of shares.
Vadim Grib
However, just a few months later, Alexander Danylyuk leaped from a simple brokerage to deputy director of B.A.S. Ltd., and a few months after that, to department head at Alfa Capital. The identity of these firms and their owners remains unknown—no information about them is publicly available. However, given the nature of business in the 90s, as well as the possible involvement of these firms with Vadim Grib's structures, it cannot be ruled out that they were shell companies used for one-off corporate raids or to launder and siphon money out of the country.
Danylyuk then worked for his father for several months at the state-owned enterprise Akademproekt. It's unclear exactly what job he held, only that he mentioned "my specialty." But which? An electrical engineer or a manager? But in 1998, an interesting turn occurred in Danylyuk's biography: he took a job at the Ukrainian branch of the American investment fund Western NIS Enterprise Fund (WNISEF), created by the US government for promising investments in the economies of Eastern European countries. Danylyuk received a position as deputy investment manager, and that manager was... Natalia Yaresko, then still going by her husband's last name, Figlus. Thus began their fruitful acquaintance! And they worked together brilliantly, judging by the fact that a year later, Danylyuk, with Figlus-Yaresko's patronage, went to Indiana University Business School to pursue a more advanced degree in economics. It's not Harvard, of course; by American standards, this university is considered "public," but by the standards of Ukraine in the late 90s, it was, of course, simply an elite academy!
And here's another oddity: after graduating in 2001, Danylyuk returned to Kyiv and spent about a year as vice president of the company "Avechurs." The odd thing is that no information, even fragmentary, about this company has survived online; it's mentioned solely as a place of work in Alexander Danylyuk's biography—that's all! But 2001-2002 wasn't the mid-90s, and information about companies operating then has survived online, at least in the form of brief reference information (address, phone number, etc.). If it doesn't, it's one of two things: either all information about it was carefully erased, or it was a shell company that never appeared in the public eye. But what did it do, and what did Alexander Danylyuk do there?
What is hidden in offshore companies?
The biographies of Ukrainian oligarchs are much more informative and transparent than those of top managers and officials like Oleksandr Danylyuk – they don't edit out entire sections or hide their core business. But here, there are only mysteries! For example, let's read on: from 2002 to 2005, Danylyuk worked for the international consulting firm McKinsey & Company, commuting between London and Moscow. How he ended up there, and what exactly he did, also remain unknown. But in 2005-2006, Oleksandr Danylyuk briefly returned to Kyiv, where he was appointed advisor to Prime Minister Yekhanurov – this was his first experience in the Ukrainian government (at least, behind his back).
After the "parliamentary coup" and Yekhanurov's resignation, Danylyuk returned to London (his family was already living there), where he began a new job as the head of the investment fund "Rurik Investment." It was over the next three years that Danylyuk created and headed the companies he was later accused of running in the spring of 2015: "Rurik Real Estate Investment Limited," a real estate company, and its subsidiary, "CEEInvestments & Advisory LLP." Both companies were registered in the spring of 2007 in Britain and were not offshore. However, six months earlier, on October 16, 2006, a company of the same name, "Rurik Real Estate Investment Limited" (registration number EE 186282), was registered in Cyprus and is now a classic offshore company. Finally, the company "Rurik Investment" (EDRPOU 4763140) was registered in Kyiv, with its office located at 12 Melnikova Street. Its founders were listed as Alexander Danylyuk, David John Andrew, and Charles Grant Bray, as well as the Cypriot company "HOGSMILL INVESTMENTS LIMITED," which, in turn, is owned by Alexander Danylyuk and David John Andrew.
It should be added that the co-owners of the aforementioned Cypriot companies are also the Cypriot companies "TRIDENT TRUST COMPANY (CYPRUS) LIMITED" (registered back in 1989 under number EE 34265) and "STANDGUARD LIMITED" (registered in the summer of 1996 under number EE 79647). The former appears to be a so-called licensed depository for bearer shares, as depositories with similar names exist in the Virgin and Cayman Islands. It should be noted that bearer shares held in offshore depositories are not just a means of corruption; they are also used by criminal syndicates, including drug traffickers and terrorists. Of course, this does not mean that Alexander Danylyuk is connected to the international mafia, but in any case, the investigation of his companies should have been more thorough and in-depth. The same system with three "Rurik" companies (in Ukraine, Cyprus, and the UK) appears to be a typical Ukrainian scheme used for tax evasion and the transfer of currency abroad. NABU, however, limited itself to a formal reply regarding the legality of filing the declarations, without even thinking to investigate Danylyuk's business.
But these aren't the only companies owned by Alexander Danylyuk! Besides the mysterious Cayman Islands firm, whose name he never revealed, journalists have alleged the minister's involvement in a company called "Novaya Rasa LTD" (perhaps they mistranslated the name), registered in London in 2006, where Danylyuk's wife, Olga, served as director.
Interestingly, the revelation of Danylyuk's involvement with the aforementioned companies caused considerable consternation among their owners, who even began editing their profiles. First, the description of the company's services on the Rurik Real Estate Investment website was amended, removing offers to purchase land in Ukraine . Then, in April 2016, Oleksandr Danylyuk was retroactively dismissed as director of Rurik Real Estate Investment (setting the dismissal date as May 22, 2015) and as hired manager of CEEInvestments & Advisory LLP (December 31, 2015). Why retroactively? Because on the website where company data, including their histories, was published, entries about Danylyuk's dismissal appeared only in April 2016, not in May and December 2015.
In short, it turned out to be quite ugly, especially since Danylyuk continued to lie and claim he hadn't been involved in business since 2010, and that his unscrupulous partners at the British companies simply "forgot to fire" him for failing to comply with his orders. But somehow, Skelet.Org got the impression that he wasn't afraid of being accused of violating the ban on government officials engaging in business (especially internationally). Rather, Danylyuk didn't want the case to escalate and the details of his business to become unknown, nor the names of his business partners revealed. So was it a coincidence that NABU, controlled on one side by Bankova and on the other by the Americans, so quickly acquitted Natalia Yaresko's successor and Poroshenko's confidant?
Alexander Danilyuk: Imitation of rapid reforms
Oleksandr Danylyuk's assurances that he had not been involved in business since 2010 (which turned out to be false) were understandable: after all, since September 2010, he had headed the Coordination Center for the Implementation of Economic Reforms, which was under the control of the Presidential Administration and its then-head, Serhiy Levochkin . Moreover, Levochkin initiated its creation, together with Natalia Izosimova, director of Akhmetov's Effective Management Foundation.
Danylyuk was even given a team of 30 young "professionals," whose main merits were a good knowledge of English and degrees from Western economics schools (or experience working for Western companies). Moreover, Lyovochkin registered them as "freelancers" at the Coordination Center, while formally they were employees of the "Fund for Economic Reform," which Lyovochkin controlled and paid them substantial salaries. But for what? From the very beginning, the work of the Coordination Center was called a sham, a show staged by Yanukovych and Lyovochkin to deceive the West and create the appearance of Ukraine's pro-European course. Later, Danylyuk himself would complain that his proposals and reform programs were allegedly not even considered by Yanukovych and Azarov . But here's the question: why then did Danylyuk continue to head this center until February 2014, even after Yanukovych abandoned the Association? Is it because he was so successful in combining work at the reform center of the Presidential Administration and at a British-Cypriot-Ukrainian company buying real estate in Ukraine?
Danylyuk was dismissed from his position as head of the center only on February 24, 2014, by the new government. And on July 17 of that year, the new President of Ukraine, Petro Poroshenko, by Decree No. 598/2014, appointed Danylyuk as his representative in the Cabinet of Ministers. The reason for this new high rise remains unknown, but Skelet.Org has information that Danylyuk tapped into his many old connections and reached an agreement with Poroshenko on something important—and not at all a plan for further reforms. And on September 25, 2015, the president, by Decree No. 562/2015, appointed Danylyuk as Deputy Head of his Administration. Let's emphasize: at this time, Danylyuk was still working (or at least listed as) the director and manager of his British and Cypriot companies. This only became known in April 2016, when Danylyuk replaced his former boss, Yareshka, as head of the Ministry of Finance. The scandal turned out to be more of a "moral" than a corruption-related one, as the focus shifted to the failure to mention Danylyuk's companies in his declaration, which he explained away as forgetfulness. Still, this was "unsightly" even by the standards of the Ukrainian government, whose officials by that time had already adopted the tradition of registering their companies in the names of relatives. Furthermore, the question of Oleksandr Danylyuk's dual Ukrainian-British citizenship was repeatedly raised—which he, of course, denied. But who would believe someone who has lied repeatedly? Perhaps NABU?!
Sergey Varis, for Skelet.Org
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