KYIV, May 19 – Billionaire Igor Kolomoiskiy, a key supporter of President Volodymyr Zelenskiy, is under investigation by a US federal grand jury for allegedly laundering hundreds of millions of dollars in US real estate, BuzzFeed News reported Tuesday.
Kolomoisky is accused by Ukraine regulators of orchestrating a scheme to siphon money from the country's largest bank and funnel it into prime properties, including landmark office towers and steel facilities across the US.
The US grand jury is examining the finances of Kolomoisky in a probe that has tracked the money from the Ukrainian bank through a maze of offshore companies to the US, according to two sources familiar with the inquiry.
The grand jury investigation in Cleveland represents a rare effort by the US justice system to target an influential oligarch and trace the millions that he and his associates allegedly sent through US correspondent banks.
Among the purchases: a 484-room, luxury hotel in Cleveland with lakefront views and a 21-story office tower just blocks away with vaulted ceilings and murals that once featured the largest bank lobby in the world.
The action also sets in motion what could be a test for President Zelenskiy, who once starred in a comedy show on a TV channel owned by Kolomoiskiy and had a personal relationship with the billionaire, who controls an energy, media, and real estate empire.
With no existing extradition treaty between the US and Ukraine, Zelensky and the country’s prosecutor general could face a difficult decision as to whether they would stand in the way in case of an indictment or allow the process to unfold.
Kolomoiskiy returned to Ukraine last year after spending two years in self-imposed exile in the wake of a government takeover of PrivatBank, which he cofounded in the 1990s.
A subsequent investigation by Ukraine regulators found a $5.5 billion shortfall in PrivatBank's ledgers from what they called “a large-scale and coordinated fraud” that involved the bank’s major shareholders, Kolomoiskiy and fellow Ukrainian billionaire Gennadiy Bogolyubov. To keep the bank from collapse, the government tapped into taxpayer funds to plug the hole.
In an interview with BuzzFeed News, Kolomoisky said he was not aware of a grand jury probe, and any deficits reported by banking regulators were "done intentionally in order to expropriate the bank, my private property," he said. "It was an artificially created hole by the national bank."
The country’s former prosecutor-general, who was leading one of the investigations, was fired in March by a vote in parliament that was led by members of Zelenskiy's party. Ruslan Riaboshapka told BuzzFeed News that he was ousted because of the investigation, while Zelensky said he supported the firing because the prosecutor was not doing enough to fight corruption. (bf/ez)