Mikhail Beilin. "The Overseer" from the AP

Mikhail Beilin

Looking at the results, the "Revolution of Dignity," like the "Orange Revolution" that preceded it, once again turns out to be a triumph of madness over common sense. As in 2005, 2014 essentially saw an intra-elite coup with entirely predictable consequences.

“Dignity” was overcome through revolutionary violence, while the structure of the political system and decision-making mechanisms, where corruption plays a major role, were fully preserved.

The fact is that the elites' orientation, their internal dynamics, and their identity, formed during the period of initial capital accumulation—that is, the turbulent 90s—are difficult to change. Only the form changes, while the internal content remains the same. Hence the characteristic management style and methods, little different from those of their "predecessors."

In this context, the story of Mikhail Mikhailovich (Markovich) Beilin is quite indicative. When studying this character, the first thing that catches one's attention is the relatively small amount of information in open sources. Most media reports portray Mikhail Beilin as a lawyer and restaurateur, a freelance adviser to the head of the Presidential Administration of Ukraine, Boris Lozhkin (Read more about Boris Lozhkin in the article — Boris Lozhkin: How to defraud the government of $160 million and become head of the Presidential Administration of Ukraine). Meanwhile, his sphere of interests is much broader, though much less frequently mentioned: he is the head of the advertising company Promotion Technologies, vice president of the All-Ukrainian Advertising Association, a member of the Council of Entrepreneurs under the Cabinet of Ministers of Ukraine, a board member of the International Association of Marketing Initiatives, and the head of the collection agency Ukrborg. Little information is available about Beilin's political preferences. Information here is limited to his participation in the 2014 parliamentary elections, where he was number 83 on the Petro Poroshenko Bloc list.

Reviews of Mikhail Beilin's work at Promotion Technologies

Of particular interest is Mikhail Beilin's connection to the Asters Law Firm (formerly Shevchenko, Didkovsky & Partners Law Firm until 2008), where our subject worked as a business efficiency consultant. Among the company's founders is former Minister of Ecology Igor Shevchenko, who was repeatedly accused of corruption and dismissed by the Verkhovna Rada at the insistence of the People's Front and the Radical Party, both of whom were naturally pursuing their own interests.

The company "Asters" provided services to "Sberbank of Russia" in connection with a loan of 700 million dollars to "Metinvest" of Rinat Akhmetov, the agroholding "Mriya", whose financial advisor was the representative of the Rothschilds Giovanni Salvetti, "Myronivsky Hliboproduct", owned by the adviser to the President of Ukraine Petro Poroshenko Yuriy Kosyuk (Read more about Yuri Kosyuk in the article — Yuriy Kosyuk – the "Chicken God" and friend of all Presidents), the Slovak gas transmission system operator Eustream, as, on legal issues related to reverse gas supplies to Ukraine from Slovakia and the subsequent preparation of transaction documents signed by the Slovak company with PJSC Ukrtransgaz and NJSC Naftogaz of Ukraine.

It's worth noting that the Main Investigative Department of the Ministry of Internal Affairs of Ukraine is investigating the former co-owners of the Mriya agricultural holding on charges of fraud, which caused damage to creditors (FUIB) in the amount of $1,3 billion. How a "reputable" legal firm provided consulting services to fraudsters remains a mystery.

It's also worth remembering that Irina Nazarova, who filed a lawsuit against the privatization of Kryvorizhstal in 2005, was a partner at Shevchenko, Didkovsky & Partners Law Firm. She allegedly held one share, according to various sources. In other words, she was used as a "crowbar" in the fight against Viktor Pinchuk.Read more about it in the article Viktor Pinchuk: Ukraine's richest son-in-law). She subsequently became an assistant to the head of the State Property Fund, Valentina Semenyuk, now deceased. Moreover, she apparently died because of the events of that time, since the plant miraculously passed into the ownership of Lakshmi Mittal (Read more about Valentina Semenyuk-Samsonenko in the article — "Fatal" Turboatom: What secrets brought Semenyuk-Samsonenko to the grave).

According to media reports, Mikhail Beilin is “keeping an eye” on the Ministry of Infrastructure, headed by Andrey Pivovarsky (Read more about Andrey Pivovarsky in the article — Andrey Pivovarsky, Minister of Infrastructure Collapse). Such claims are not unfounded, given that before joining the late Igor Eremeev's Continuum Group in 2012, Andrey Pivovarsky headed the investment banking division of Dragon Capital. During his tenure at the company, Pivovarsky led several IPOs of Ukrainian assets. These included the placement of shares in Davento (the development division of Velyka Kyshenya), Furshet, KP Media, and Clubhouse (a hotel chain operator).

Andrey Pivovarsky

At the same time, the law firm "Asters" not only actively collaborated with Dragon Capital, but also provided consultations to the State Agency of Automobile Roads of Ukraine in connection with the private placement of domestic bonds in the amount of 14 billion hryvnia (approximately 1,75 billion US dollars), and according to the law, "Ukravtodor" is subordinate to the Ministry of Infrastructure.

Among politicians representing pro-presidential forces, it's commonplace to declare that appointing "insiders" to the management of state-owned enterprises, regardless of political affiliation, is unacceptable, as it contradicts the guarantor's "general" anti-corruption policy. However, the sincerity of such statements, as well as the entire "fighting line," is questionable, to say the least.

At least the facts suggest otherwise. In February 2015, Yevhen Khoroshchak, who had previously worked as an advisor at Dragon Capital, was appointed acting head of the state-owned enterprise Ukrzaliznytsia Postach. This state-owned enterprise falls under the management of Ukrzaliznytsia, which, in turn, is a subdivision of the Ministry of Infrastructure of Ukraine, headed by Pyvovarsky, a former Dragon Capital employee. According to Khoroshchak himself, he was recommended for this position by Mykhailo Beilin, who set him the task of fundamentally reforming the enterprise.

The "reform" was completed in December 2015, following a series of high-profile revelations and accusations of corruption. For example, violations were uncovered during tenders for the purchase of rail fasteners, where overpayments amounted to 7 million hryvnias. Some time later, Deputy Prime Minister of Ukraine Valeriy Voshchevskyi (Read more about Valery Voshchevsky in the article — Voshchevsky. Non-radical radical) accused Khoroshchak of violating fuel procurement regulations, which nearly paralyzed traffic on all six railways.

Alexander Zavgorodniy, who decided to develop his "family" business at the state's expense and for this reason has repeatedly been implicated in corruption scandals, also told journalists about Beilin's involvement in his appointment as acting head of Ukrzaliznytsia.

Another reason for suspicions of Beilin's shadow management and lobbying was the story of the vote for the draft law "On the restructuring of obligations on loans in foreign currency."

As a reminder, according to the bill, loan debt is converted at the official exchange rate of the National Bank of Ukraine at the time of the loan agreement, and the exchange rate difference is written off by banks. All consumer loans obtained for the purchase of any property are subject to restructuring, with no limit on the amount of the debt. The bill was adopted in its third reading on July 2, 2015, with 229 votes in favor.

According to experts, the primary interests in this law are debt collectors, who bought up problem loans at huge discounts between 2009 and 2013. If the loan principal and interest are recalculated at the old rate, borrowers will rush to repay their debts not to banks, but to collection agencies. One of the largest such companies is Ukrborg, where Mikhail Beilin worked, and whose main beneficiary is none other than Alexey Didkovsky, managing partner of the same Asters Law Firm.

Alexey Didkovsky

Reviews of Ukrborg

The vote of the BPP members for this bill caused outrage among the former head of the SBU Valentin Nalyvaichenko (Read more about Valentin Nalyvaichenko in the article — Valentin Nalyvaichenko: Spy, Diplomat, and Corrupt Official). "There is a resumption of cynical and brazen corruption in parliament. I have a question for Lutsenko (Read more about Yuriy Lutsenko in the article — Yuriy Lutsenko. The "Terminator" of Ukrainian Politics"How did he end up with a 'supervisor' in his faction? This 'supervisor' intimidates deputies and pressures them when voting on any issue!" Nalyvaichenko stated, clearly alluding to Beilin.

Meanwhile, the "overseer" knows how to not only "pressure" and "intimidate," but also, to use Nalyvaichenko's jargon, who needs to be "warmed." The amount of "warming" is determined by the position held, as evidenced by the publicly disclosed "black ledger," which details bonuses paid to officials and even a minister in US dollars.

From the above we can draw the following conclusions:  

1. Judging by reviews of the companies Mikhail Beilin headed, his effectiveness as a manager is questionable. At the same time, his ambition, lively personality, and ability to establish connections allowed him to gain patronage in the highest echelons of Ukrainian power.

2. Of greatest interest is Beilin's positioning as a lawyer for the firm "Asters." The company's areas of interest and the consulting services its employees provide to ministries and agencies, large businesses, including Petro Poroshenko's business partners, and international financial institutions suggest Beilin's high level of knowledge and access to exclusive information, which explains the interest of the Presidential Administration.

3. Mikhail Beilin's combination of certain qualities and high level of awareness allow him to be used both as a communicator with representatives of financial-industrial groups and as a covert overseer of certain ministries and agencies. As for dialogue with representatives of large businesses and political forces, the "legend" of a successful restaurateur creates a favorable atmosphere for informal contacts.

Kasym Dzhumasov, for SKELET-info

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