Russian-ukrainian oligarch Pavel Fuks charged with grandiose financial fraud – stripping Ukraine’s strategic assets

author's blog *

Ukraine’s security and intelligence services (SBU) stated that Pavel Fuks (aka Pavlo Fuks), a self-styled oligarch who had a scandalous career as a Moscow builder, had illegally seized over UAH 100 billion ($2.7 billion USD) worth of assets of Ukrainian companies since 2018.

Prior to relocating to Ukraine, Mr. Fuks operated MosCity Group, a company based in Moscow, Russia. The enterprise was a developer of high rise commercial and residential complexes, but became bankrupt, mired in gang rivalry, lawsuits and criminal investigations in Russia and Kazakhstan.

Pavel Fuks’ associates, proxies and lawyers targeted Ukraine’s energy, machinery, and metallurgical companies, which had loans from bankrupt banks.

As reported by Yahoo News and New Voice of Ukraine, the controversial businessman bought out the “credit obligations” of these Ukrainian companies from banks “for a song”, which allowed him to disrupt their business operations and ultimately seize control, the SBU announced in disclosing charges against him. Was Mr. Fuks acting as a ruthless businessman or a proxy for hostile foreign interests – perhaps as both…

Pavel Fuks froze assets of Ukrainian plants and infrastructure facilities, blocked their operations, or forced them into bankruptcy.

Pavel Fuks, who according to the Guardian is residing in London, England, and his accomplices are alleged to have carefully concealed the sources of financing for the rogue transactions and the beneficial ownership through a complex financial fraud scheme, as announced by Ukraine’s authorities.

Mr. Fuks and his cohorts obtained excessive profits and evaded taxes, the Ukrainian security service announced. Just one of these transactions caused almost UAH 100 million ($2.7 million) losses to the Ukrainian state.

“Based on the evidence collected, Pavel Fuks and two top managers of his holding company were charged with tax evasion under Part 3 of Article 27, Part 3 of Article 212 of the Criminal Code of Ukraine”, the SBU reported.

“The corporate rights and accounts of 101 companies involved in their illegal activities were seized, as well as the rights to claim more than 1.600 repurchased loans, over 240 real estate objects and vehicles of the scheme participants”.

“Some of the seized assets have already been transferred to the management of the ARMA (National Agency of Ukraine for finding, tracing and management of assets derived from corruption and other crimes)”, the Ukrainian security service said in a public statement.

Just prior to indicting Mr. Fuks, the SBU charged another Ukrainian oligarch Dmytro Firtash with misappropriation of state gas worth billions of hryvnias. Mr. Firtash refuted all the charges and stated that he will defend himself in court.

Ukrainian President Volodymyr Zelenskyy imposed in June 2021 sanctions on a number of individuals and legal entities, including oligarchs Dmytro Firtash and Pavlo Fuks (both alleged to represent Russian interests).

Mr. Fuks has been allegedly deported from U.S., Mexico and Israel. He has admitted that he hired former New York Mayor and President Trump’s former lawyer, Rudy Giuliani, as a lobbyist. Mr. Giuliani has admitted having done work for Mr. Fuks but denied that it entailed lobbying.

U.S. and U.K. journalists have been investigating Mr. Fuks for months and have disclosed that Pavel Fuks has been subject of multiple law enforcement investigations in U.S., as has pointed out in the New Yorker and Business Insider. Mr. Fuks has denied any culpability or knowledge of any investigations and has claimed that the criminal charges and sanctions leveled against him are politically motivated and that he remains a Ukrainian patriot and is supporting Ukraine’s military from his home in London.

The New Voice of Ukraine and Matt Rogers

19.08.2023

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