Reinis Tumovs
3 billion hryvnias disappeared without a trace at the small ProFin Bank. Possibly part of the stolen money
Bankers used it to finance "Novorossiysk" terrorism.
…When the “messengers” from the National Bank descended on the office of this financial institution, they realized that there was nothing special for them to do there:
Investigators were hard at work at the bank. On January 19, the Professional Financing Bank was declared insolvent.
"This decision was made following the results of supervision of the activities of ProFin Bank OJSC regarding compliance with legislation on preventing and combating the legalization (laundering) of proceeds from crime or the financing of terrorism," the NBU said in a statement.
The NBU also notes that the bank was closely associated with the insolvent CityCommerce Bank, from which loans and fixed assets were acquired. Specifically, a significant number of ProFin's branches are located in premises previously leased by CityCommerce Bank, and the Tumovs family, associated with CityCommerce Bank, currently controls the majority of companies that are members of ProFin Bank's majority shareholder.
This is a somewhat boring but important observation. "City Commercial Bank" (which, for advertising purposes, adopted the name of the Western City Bank, although in reality it was a shady Donetsk outfit) and "ProFin Bank" are one and the same. In fact, through a network of Cypriot and Belizean offshore companies, it is nominally owned by Baltic banker Reinis Tumovs. Again, only nominally. CRIME.in.UA would venture to suggest that Tumovs is a sort of figurehead, with more serious businessmen reaping the richest fruits of his banking schemes.
According to experts, ProFin and Co. absorbed a total of 3 billion hryvnias. The scam dates back to the heyday of Yanukovych's "Family" and reached its peak last year. Meanwhile, the hotheaded Baltic guy received support back then, and hasn't been punished yet. His hired hackers are attacking online publications (though not very successfully) that dared to dig into his shady dealings. Costumed protesters are demanding refinancing for ProFin outside the National Bank. And Tumovs himself
He buys up entire columns in central newspapers to fill the readers with nonsense about how he is bravely saving investors' money, and therefore the state should pour another billion or two into his "scam."
Tumovs is obviously an adventurer, but judging by his eyes, he's no fool. He has reason to believe he'll get away with it. And reason to hope they'll give him more money. Why? More on that later. For now, let's focus on how money was stolen from ProFin Bank and CityCommerce.
Black hole
As Margarita Ormotsadze wrote in Forbes, the National Bank of Ukraine reported that CityCommerceBank's problems were largely due to the fact that over 70% of the bank's loans, totaling UAH 1,3 billion at the time of the temporary administration, were held by approximately ten LLCs. Some of these LLCs have a dubious reputation in financial circles. Some, such as Zernopostach-2013, are already facing legal action by the tax authorities. According to Forbes' sources in the tax authorities, Kikko Best LLC, Excillent Trade LLC, Stroybudpostach LLC, Strand LLC, and Reel Made LLC exhibit the characteristics of enterprises "for conducting cash withdrawal or cash-out operations."
Currently, losses from the activities of Tumovs’ “offices” are estimated at 3 billion hryvnias.
Victoria Rudenko described in detail on the FinMaidan website how and through which shell companies the money was withdrawn.
Rudenko obtained copies of statements filed by temporary administrator Andrei Ryazantsev (who held this position from November 21, 2014, to January 27, 2015) to the Ministry of Internal Affairs and the Prosecutor General's Office. The administrator reports instances of funds being siphoned off from the institution, including through loans to insolvent companies, as well as to enterprises that had received warnings from the bank's risk management departments or security service.
The documents state that Korn Group LLC, which "had insufficient liquidity and is not financially stable—it is dependent on external sources of financing," received a loan of UAH 18 million. The same conclusion was made for Ukrviknoprom LLC, which attracted UAH 10,3 million. Stroybudpostach LLC, registered in March 2013, had already attracted UAH 15,8 million in June 2013, despite the bank's security service warning that the borrower's contact phone number was confidential.
is the contact number for Zernopostach 2013 LLC and Germesbutmaterial LLC. One of the contact numbers was also listed in an advertisement for the purchase of an LLC with VAT in Poltava for 8 UAH in February 2013. "These facts may indicate the fictitious nature of Stroybudpostach LLC's activities, and opening a credit line is risky," the bank's security service concluded.
A mandatory condition for issuing a loan to Umbrella Development Investment Corporation LLC was the “absence of comments in the conclusions of the legal service,
Security services, and collateral appraisal services for this loan agreement." However, the Fund's statement asserts that "no conclusions were provided," and the UAH 39 million loan was issued anyway on January 23, 2014. The collateral was a commodity in circulation—mine waste from Torez in the Donetsk region. The same company guaranteed loans to Kikko Best LLC, Melange-M Private Enterprise, and Excellent Trade LLC. It pledged land plots whose assessed value covered less than 50% of the loans. Kikko Best LLC was registered on November 15, 2013, but received the loan in January 2014. Since June 4, 2014, the company has been in a state of suspension.
Another company, Myslivski Stezhki Ukrainy LLC, acted as collateral for loans to six legal entities totaling UAH 424 million issued in 2013. Land plots were pledged as collateral for the loans. However, they only covered 25-50% of the loan amount. By the time the administration was introduced, all loans were already in default, and two borrowers decided to liquidate on the same day, June 6, 2014.
The provisional administration discovered that borrowers who had secured loans against deposits were cashing out the deposits immediately after receiving the loans. Naftopraktik Plus LLC received a UAH 65 million credit line secured by a UAH 90 million account. After receiving the first tranches, the collateral agreement was terminated, and the borrower withdrew UAH 66 million from the bank accounts.
City Commercial Bank's portfolio also includes illiquid collateral currently located in territories not controlled by Ukraine. For example, on April 29, 2014, Garant-Auto PJSC pledged a building in Donetsk to Beverly Rox LLC as collateral for a UAH 45 million loan. It's worth noting that the deputy chairman of the board of Garant-Auto PJSC was Mikhail Pryanichnikov, who had served as the director of the strategy and control department at Global Financial Management Group LLC, the owner of City Commercial Bank, since 2012. He was also a member of the supervisory board of ProFin Bank. However,
Mikhail Pryanichnikov personally did not sign the agreements on the provision of collateral.
A "mole" in the Ministry of Internal Affairs and terrorist money
According to the ORD website, an Odessa-based currency conversion center, codenamed "Zernotreyder," was used, among others, to cash out funds stolen from CityCommerce. It is believed the conversion was carried out through fictitious grain purchase transactions. A month ago, investigators decided to crack down on this company as part of the "CityCommerce case."
On January 29, in Kyiv, in order to ensure secrecy in the seizure of the accounts of fictitious companies during an operation across Ukraine, four orders from the Pechersk District Court to seize the bank accounts of fictitious companies were personally handed to the Head of the Department of the State Service for Combating Economic Crime of the Main Directorate of the Ministry of Internal Affairs of Ukraine in Dnipropetrovsk Oblast, Police Lieutenant Colonel Oleg Viktorovich Zolotonosha.
The following morning, A.V. Zolotonosha informed the Ministry of Internal Affairs that the court orders had been implemented. However, as was later established from the court rulings received by the Main Investigative Department of the Ministry of Internal Affairs of Ukraine on February 10, 2015, these court orders were announced at different times.
Given the power of the Odesa "envelope" leaders to block the investigation into CityCommerce Bank, the case was "dismantled," and the investigator was simply overwhelmed with cases involving other banks. As a result, funds that were supposed to be frozen on January 30 were withdrawn from accounts in early February.
Impressive? But that's not all.
As CRIME.in.UA reported, three months ago, the SBU's special unit "Alpha" conducted searches at the bank.
Alliance. Initially, law enforcement agencies investigated it as a Ponzi scheme, suspecting it of laundering large sums of money. More than 600 million hryvnias were illegally transferred through accounts at these institutions. During searches, it became clear that this wasn't the worst of it. Seals of the Donetsk and Luhansk People's Republics (DPR and LPR) were found in the bank's offices, as well as contracts that could have been used to finance terrorist groups.
Some other details can be found in the Unified Register of Court Decisions.
The searches at the Alliance were carried out as part of an investigation into the activities of a number of “enterprises in the real sector of the economy that used so-called
"Transit enterprises" (buffers), with the aim of minimizing the tax burden, artificially creating a VAT tax credit, illegally transferring currency outside of Ukraine using fictitious commercial structures, as well as for the misappropriation and seizure of other people's property, including state funds, allegedly for the performance of work, provision of services, and delivery of goods." Cashing out occurred through "tax pits" involved in the "conversion center" scheme, with
their subsequent cashing out through the accounts of PJSC CB Axiom, JSC Zlatobank, PJSC Platinum Bank, JSC UkrSibbank, PJSC CB Eurobank,
PJSC Avant-Bank, PJSC Bank Alliance, PJSC AKB Concord, PJSC Bank National Credit, PJSC ProFin Bank, PJSC Bank Mikhailovsky, PJSC Radical Bank.
A logical question arises: is ProFin Bank involved in terrorist financing? I don't want to make blanket accusations, but considering who's really behind this financial institution, anything is possible. So...
…to be continued.
Based on materials from: CRIME.in.UA
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