Oligarch Kolomoisky is blackmailing the government from jail, journalist alleges

Ukrainian oligarch Ihor Kolomoisky is allegedly blackmailing the government, even while in custody, Sergii Golovnov, LIGA.net business department head and co-author of the Telegram channel Monopolist, told Radio NV on Nov. 16.

Kolomoisky is not communicating with Ukraine’s Presidential Office, Golovnov said.

Read also: $27.3 million in alleged fraud: Kolomoisky ’s case

"He owns two strategic enterprises, Nikopol and Zaporizhzhia Ferroalloy Plants,” he said.

“There is also a mine nearby where ore is extracted. Their products are crucial for the Ukrainian metallurgical complex. In early November, these two plants announced that they would be suspending operations due to energy security concerns, even though last winter when the shelling already took place, they weren’t shut down."

Government contracts with the enterprises were signed for the entire winter period, so the shutdowns come as a surprise, Golovnov said, citing insider information from the enterprises' contractors.

Read also: Kolomoisky court hearing postponed

"When they talked to the management, they said: 'We have contracts with you, what are you doing?' The answer: 'We were given such instructions,'" said Golovnov.

While the plants stated they would continue paying salaries, the ability to do so, "even if they wanted to," may be limited to a few months.

"Secondly, if this product is not available, then other metallurgical plants, Zaporizhzhya Steel and AMRC, might be suspended too," added Golovnov.

Although Kolomoisky controls these plants, he is not their sole owner, the journalist explained.

According to Golovnov, these plants are not highly profitable without the previously available cheap resources, such as electricity and gas from state-owned companies Centrenergo and Ukrnafta, respectively, which were controlled by Kolomoisky in the past. If the scheme that Kolomoisky used to employ—leaving losses on state-owned companies and withdrawing profits to "some private one-day LLCs"—doesn’t work, Nikopol and Zaporizhzhia Ferroalloy Plants are not very cost-effective.

"It will, however, create a significant problem in the production chain of goods, which remains to this day significant in terms of obtaining foreign exchange earnings for the country. Foreign exchange earnings are essential for jobs and taxes," explained the journalist.

Kolomoisky’s motive is to try to achieve his release from pre-trial detention, argued Golovnov. Kolomoisky does not actually need the two plants to be profitable, as he can simply use them to create a political crisis.

“It is very difficult for him to leave the country — he could end up in jail in those countries of which he is also a citizen, in Cyprus or Israel. I don't think he'll go to Israel right now," he said.

Read also: Influential oligarch Ihor Kolomoisky charged with fraud, money laundering — NV source

The Shevchenkivskyi District Court of Kyiv issued on Sept. 2 a preventive measure for Ihor Kolomoisky, ordering his detention for a period of 60 days in Dnipro. He was granted the option to secure his release by posting bail.

On the same day, the SBU, in collaboration with the State Bureau of Investigations (SBI) and the Prosecutor General’s Office, formally charged Kolomoisky with money laundering of criminally obtained assets. From 2013 to 2020, Kolomoisky allegedly laundered over half a billion hryvnias by transferring funds abroad, utilizing the financial infrastructure of banks under his control, the SBU said.

The National Anti-Corruption Bureau (NABU) and the Specialized Anti-Corruption Prosecutor’s Office (SAP) on Sept. 7 informed Kolomoisky and five others of suspicion in embezzling over 9.2 billion hryvnias from PrivatBank ($247 million).

The SBU states that during that period the scheme enabled him to amass a total of UAH 5.8 billion, equivalent to over $700 million.

On Oct. 27, the court extended Kolomoisky’s pre-trial detention until Dec. 2.

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