Kroll report, Ukraine: Kolomoiskiy and Surkis brothers withdrew money from Privatbank during the bail-in
According to this information, in 2008-2010 a number of companies associated with Privatbank received loans from Privatbank Cyprus, totaling USD 361 million.
“The loans, which totaled USD 361 million, were grouped in batches, within which loans were issued within minutes of each other before being immediately channeled through a web of transactions between related party company accounts which appeared to have no obvious commercial purpose.”
According to investigators, the same funds were later deposited in Privatbank. They were initially deposited for a period of up to two years at the time of the bail-in on the accounts of a number of companies that later redirected funds to deposit accounts of six companies: Sofinam Investments LLP, Lumil Investments LLP, Berlini Commercial LLP, Camerin Investments LLP, Sunnex Investments LLP, and Tamplemon Investments LLP. They were all registered on the same day at the same address and came under the jurisdiction of the British Virgin Islands.
“These six account holders represented around 80% of the total bailed in deposits in Cyprus, totalling USD 245 million… …The interest which was earned on the deposits was significantly higher than the interest which was due on the loans,” – the Kroll report states. “The loans appear to be a part of a much larger long term scheme, whereby loans issued by Privatbank Cyprus were recycled and paid off by new loans which were issued under the guise of legitimate corporate lending. Although the loans which were issued and which were channeled to the depositor accounts have now been settled, the source of funds which settled them has not yet been fully understood, as it involved multiple layers of loan recycling.”
About USD 150 million, including loan funds and interest, was withdrawn from Privatbank through this scheme. According to the Kroll report, these funds were transferred to a number of accounts held at the Bank of Cyprus.
Kroll’s research showed that all six deposit accounts mentioned in the report lead to Grigory and Igor Surkis. They are Ukrainian oligarchs and business partners of Igor Kolomoiskiy, one of the biggest shareholders of Privatbank before its nationalization. Surkis brothers tried to prove in the courts that they were not associated with the former owners of Privatbank and insisted that the bail-in procedure was illegal.
Simultaneously with the court proceedings in Ukraine, Igor Surkis filed a lawsuit in the High Court of London. The lawsuit, contrary to the Ukrainian proceedings, declared the obvious connection between Surkis brothers and Igor Kolomoisky.
On June 15, 2020, the Grand Chamber of the Supreme Court of Ukraine decided to close the case of Surkis family against the National Bank of Ukraine: they failed to challenge the fact of their connection with the former owner of Privatbank Igor Kolomoiskiy.
A Kroll’s independent investigation of the Privatbank activities was carried out from 2016 to 2017. It showed that Privatbank had been part of large-scale co-ordinated fraud scheme for at least ten years prior to the bank nationalization, resulting in bank loss at least USD 5.5 billion. This information is stated in the investigation results that were presented by the National Bank of Ukraine in January 2018.
