Non-public millionaires from Dnipro are siphoning billions offshore.
Dirty banking "shell"
This summer, a major financial scandal tinged with corruption erupted in small Latvia, as reported by [high-profile cases]. According to the local online publication Kompromat.lv, in June of this year, ENAP (Latvian Economic Crime Agency, Ekonomisko noziegumu apkarošanas pārvaldes) arrested a group of foreign citizens who were laundering criminally obtained funds. And on a large scale, at that.
Thus, several citizens of the Russian Federation were engaged in technical work: they drew up fictitious contracts for supposedly completed transactions, made transfers, and provided IT support.
During the search, a special forces unit revealed that some of the transactions were then transferred to the Estonian bank Versobank AS, which was not officially registered in Latvia as either a branch or a subsidiary. However, according to investigators, its activities require the official registration of a credit institution in Latvia, rather than the provision of services on a voluntary basis.
As a result, the case related to the “shell bank” ended up in a separate proceeding at ENAP.
A shell bank is a credit institution whose management and service provision are not located in the country in which the bank is registered, and whose operations are not supervised. In Latvia, such banks are prohibited.
"There is currently a lobbying group trying to stop the investigation into figures from Estonia's Versobank," a source in the Security Police told Kompromat.lv.
According to a source at Kompromat.lv, the search of the office on Mūkusalas Street (Rīga, Mūkusalas iela 101) ended with the arrest of bank employee Natalja Šilina.
"Surprisingly, neither Versobank Supervisory Board member Vladimir Fogels, nor his colleague, Head of Customer Service Marija Sutirina, nor Management Board member Artur Yermolayev were detained by the police. It's hard to imagine they weren't aware of the work of employee Natalia Shilina," a source in the Security Police told Kompromat.lv.
According to a source for Kompromat.lv, Dnipro residents Artur Ermolaev and his wife Kristina (Moskalenko) frequently visit Latvia.
Since 2012, the Estonian Versobank has belonged to the Ukrainian agro-industrial company UKRSELHOSPROM PCF LLC, which is part of the Alef corporation, the ultimate beneficiaries of which are Vadim Ermolaev (Arthur's father) and Stanislav Vilensky.
According to the bank's official website, Yermolaev and Vilensky are members of its board. It also states that Versobank AS also has representative offices in Kyiv and Dnipro. However, it is not listed among banks licensed by the National Bank of Ukraine. Clearly, Versobank AS operates in Ukraine in the same "shell" manner as it does in the Baltics. In other words, it launders money from anyone willing to pay its share.
This financial institution has already come to our attention. As CRiME reported, in October 2015, Ukrinmash, a company part of the state-owned Ukroboronprom concern, transferred $1,92 million to the Versobank AS accounts of the British offshore company Fuerteventura Inter LP for "agency services" allegedly rendered in the supply of ammunition from Ukrainian arsenals to the UAE. In reality, according to NABU investigators, the British offshore company provided no services to the Ukrainian arms company, and nearly two million dollars ended up in the hands of corrupt officials. At the time the agreement with the British was drawn up, Volodymyr Omelyanchuk was acting CEO of Ukrinmash, and his deputy was Leonid KryuchkovThe latter is known as the owner of the offshore company Bayrock Finance Limited, to which funds belonging to former Energy Minister Eduard Stavytsky were siphoned off.
65 billion in two and a half years
In Ukraine, Stanislav Vilensky and Vadim Ermolaev are involved in a massive money laundering scheme carried out through their AktaBank.
Two years ago, the National Bank blocked the operations of one of the country's largest money laundering banks. As reported by the online publication FinMaidan, the NBU, by Resolution No. 576, declared AktaBank insolvent. Following this, the Deposit Guarantee Fund appointed a temporary administration for three months on September 17, 2014. In January of this year, the liquidation deadline for the "laundromat" was extended to January 15, 2018. FinMaidan obtained data indicating that Dnipropetrovsk-based AktaBank cashed out foreign currency through individual accounts totaling 65 billion hryvnias over more than two years.
Back in May 2014, the NBU conducted an unscheduled on-site inspection of PJSC AktaBank. According to FinMaidan, during the inspection, NBU inspectors assessed the institution's compliance with legal requirements regarding the prevention and counteraction of money laundering and terrorist financing. This inspection, conducted in the midst of the May holidays, revealed issues that inspectors had overlooked during the years when Igor Sorkin and Sergey Arbuzov led the National Bank.
"In 2012, 2013, and the first four months of 2014, individual clients of AktaBank PJSC received foreign currency cash from their current accounts in an amount equivalent to over UAH 65 billion in hryvnia," states NBU Order No. 29-r dated May 22, 2014. In 2013 alone, UAH 27 billion in foreign currency cash was issued. Another UAH 4 billion was issued in January-April 2014. Thus, cash withdrawals in 2012 totaled a record UAH 34 billion.
For example: UAH 31 billion withdrawn from accounts in 2013 – early 2014 constituted 10% of the total volume of foreign currency issued by the country’s banks during this period (UAH 321 billion).
The NBU commission's decision stated that the bank's clients' passport data was not fully stored—copies of their photographs and residential addresses were missing. NBU inspectors found that AktaBank's internal financial monitoring rules, client identification program, money laundering risk assessment and management program, and financial monitoring of deposit transactions were in violation of legal requirements.
On May 21, 2014, the NBU commission decided to ban AktaBank for several months from accepting deposits from individuals, including by issuing deposit certificates, opening hryvnia accounts for retail clients, and making cash payments from them, except for salaries, pensions, scholarships, medical treatment, and education. Furthermore, it was proposed to revoke AktaBank's general license No. 243-3, issued October 5, 2012, for foreign exchange transactions.
AktaBank disagreed with the National Bank and immediately challenged both decisions in court. On May 27, 2014, the Kyiv District Administrative Court, in case No. 826/7241/14, suspended the NBU's order revoking the general foreign exchange license as a security measure. The NBU was prohibited from disconnecting AktaBank from the Interbank Foreign Exchange Market Agreement Confirmation System (ValCli). Two days later, the court suspended the NBU commission's decision banning deposits. "The order is subject to immediate execution; appeal does not halt its implementation," the court ruled, as it saw "an obvious risk of harm to the rights, freedoms, and interests of PJSC AktaBank." The NBU was forced to reinstate AktaBank's foreign exchange license by Order No. 321-r.
AktaBank ultimately lost this case on September 9, 2014, in the Kyiv Administrative Court of Appeal. But while the trials were ongoing, in late July 2014, AktaBank provided loans to four companies associated with Yermolayev totaling $38 million, secured by assets of enterprises located in the ATO zone (Luhansk). It then filed early loan repayment demands, knowing the funds would not be repaid. The Prosecutor General's Office website reported that the prosecutor's office had opened criminal proceedings against AktaBank officials for embezzling more than 400 million hryvnias of depositors' funds.
It is noteworthy that in February-March 2014, AktaBank, among other "washing houses," was involved in the transfer of a $200 million tranche abroad. This money, as CRiME reported, belonged to Kurchenko, Arbuzov, and Klimenko (Read more: Alexander Klimenko. He flew away, but he really wants to return.). But the messages allegedly never reached the "addressees" who were already "registered" in Moscow at that time.
Read also: 14 school directors fired in Dnipro for extortion
As of August 27, 2014, Artur Vadimovich Ermolaev, registered in Dnipro, owned 5% of the capital of Dnipropetrovsk-based AktaBank. His grandmother, Svetlana Ermolaeva, owned approximately 70% through trustees and Cypriot and Ukrainian companies. Her son, Vadim Ermolaev, together with Stanislav Vilensky, owns the Dnipropetrovsk-based Alef Group, which includes an agricultural business.
Dangerous useful connections
As CRiME reported, Ermolaev-Vilensky's "offices" were previously noted to have close ties with the Ukrainian arms mafia and drug syndicates.
In this context, the press mentioned the office of the Ukrainian corporation FIM Group in the Cayman Islands. FIM Group is owned by communist Oksana Kaletnik and the Alef corporation, represented by Vadim Yermolaev and Stanislav Vilensky.
Oksana Kaletnik's cousin is Igor Kaletnik (Read more: Igor Kaletnik. The story of Ukraine's chief customs officer and his smuggler friends.) – during Yanukovych's presidency, he headed Ukrainian customs. And, as has been repeatedly mentioned in the press, he gave preferential treatment to his partners Vadim Alperin, Igor Urbansky, and Nikolai Rudkovsky (Read more: DOSSIER: Rudkovsky Nikolay Nikolaevich), whose companies were involved in weapons schemes, including illegal ones.
Ermolaev-Vilenskyy's companies also effectively assisted Dmitry Yelmanov in the 590 million hryvnia scam against the state-owned Ukreximbank. Yelmanov is the ex-husband of Oksana Kaletnik, with whom he, however, maintained a good business relationship.
CRiME previously reported that in August 2014, Yelmanov became a freelance adviser to Borys Lozhkin, now the former head of the Presidential Administration, and headed the Administration's Department for Law Enforcement and Anti-Corruption. A few months later, Lozhkin fired him. Last year, Yelmanov attempted to head one of the key departments of the National Anti-Corruption Bureau, but failed the competition due to a corruption scandal related to his status as a combatant in the Anti-Terrorist Operation (ATO) zone. It is noteworthy that this year, the NABU launched an investigation into fraudulent transactions involving Ukroboronprom, including one in which kickbacks were laundered through Yermolaev-Vilenskyy's Estonian bank.
In 2015, rumors circulated in the media that Vadim Yermolayev's affairs were in trouble and he had fled the country. However, by the end of last year and the beginning of this year, entities associated with him won tenders for the state-owned enterprise Yuzhny Port worth a total of 60 million hryvnias. Less than a month ago, Yermolayev personally purchased AC-Terra International Ltd., a company that sells agricultural machinery in Ukraine. Overall, it's worth noting that he's doing quite well, despite the fact that by law he should forfeit everything he's acquired through "backbreaking labor."
Why has he, and many others mentioned in our investigations, yet escaped accountability, blithely accumulating their wealth? Why are those who want to hold them accountable facing challenges? We'll cover this next time.
To be continued.
Read more: Alexander Klimenko. He flew away, but he really wants to return.
Igor Kaletnik. The story of Ukraine's chief customs officer and his smuggler friends.
DOSSIER: Rudkovsky Nikolay Nikolaevich
Yaroslav Garmash, Ivan Pomidorov and Pavel Shults especially for [high-profile cases], CRiME`a и Oligarch
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