KYIV -- Ukraine's state-owned export-import bank lent $60 million to companies owned by a businessman with interests in parts of eastern Ukraine controlled by Moscow-backed separatists, a new investigation has found.
The businessman, Serhiy Bryukhovetskiy, has also paid millions of Ukrainian hryvnyas in taxes to the separatists and put up as collateral for the loan a Kyiv shopping mall whose ownership is under dispute, according to the findings by Schemes (Skhemy), an investigative news project run by RFE/RL's Ukrainian Service in cooperation with UA: Pershy television.
The findings raise questions about why Ukreksimbank -- which is Ukraine's third-largest bank by assets and serves as the authorized financial agent for the government when making foreign loans -- was allowed to issue financing to an entity doing business with the separatists, possibly in violation of Ukrainian law.
The findings also come as Ukreksimbank's chief executive is under fire for a confrontation with Schemes reporters who raised the question of the loan as they interviewed him earlier this week.
In April, the loan committee at Ukreksimbank authorized a $60 million loan to two companies controlled by another company owned by Bryukhovetskiy. The bank, which is nominally independent from government interference, is overseen by a supervisory board, whose members are, under the bank's governance rules, appointed by the cabinet after an independent competition. Observers say that, in fact, they usually represent the interests of three entities: Ukraine's president, Cabinet of Ministers, and parliament.
Corporate registry documents show that the parent company, registered in Horlikva, just north of the regional capital of Donetsk, specializes in the maintenance of equipment and machinery used in mines.
Mining for coal and other minerals is a major industry in eastern Ukraine. It is also major source of revenue for the separatists who have controlled parts of the area known as the Donbas and its mines since war against government forces erupted in April 2014.
Ukrainian authorities later imposed a trade blockade and made it illegal for Ukrainian companies to do business with companies in the separatist-held areas under a law prohibiting "terrorist financing." The blockade, however, is known to be porous, with some trade circumventing the prohibition.
Public records, however, show that Bryukhovetskiy's company paid around 1.4 million hryvnyas (about $50,000) to the separatists based in Donetsk in the first seven months of 2021 -- something that could be considered illegal under the "terrorist financing" law.
Schemes was unable to contact Bryukhovetskiy for comment. A request for comment submitted to Bryukhovetskiy's son-in-law, who is a member of Ukraine's parliament, went unanswered.
Adding further to the mystery is the question of the collateral that Bryukhovetskiy put up to receive the Ukreksimbank loan: a Kyiv shopping mall known as Sky Mall, which has been at the center of a multinational legal battle pitting an Estonian businessman against a Ukrainian businessman.
The multiyear fight over the mall's ownership has been heard in London arbitration court and drawn a public warning from Estonia's president about investing in Ukraine. It has also been the target of investigations by Ukrainian authorities.
Bank documents seen by Schemes show Bryukhovetskiy's company in fact currently owns Sky Mall, something that had not been previously reported.
During an interview on October 4 at Ukreksimbank's Kyiv offices, Schemes sought commentary from bank CEO Yevhen Metsher, and showed him the ownership documents. Metsher became defensive, and he and his spokesman ordered a security guard to seize the cameras and memory cards of two Schemes reporters.
The journalists were allowed to leave the office after the interview was apparently deleted from their memory cards. But Schemes’ technicians managed to retrieve video showing the entire confrontation.
Amid condemnation from top government officials, including President Volodymyr Zelenskiy's office, Metsher stepped down temporarily as CEO.
The day after the interview, Ukreksimbank released a statement saying that the information being sought by Schemes reporters was a "bank secret," and made the false assertion that the crew left the bank offices "without hindrance."
In a post to Facebook on October 5 that was later deleted, Metsher wrote: "What happened yesterday and is unfolding today around the bank's brand and my name is no longer journalism, but actions deliberately and purposefully aimed at provoking and tarnishing the reputation of management and its activities."
After the announcement that he was stepping down temporarily, Metsher posted another message to Facebook, and apologized to RFE/RL for his actions.
"I am ready to fully cooperate with the investigation. I am deeply confident that freedom of speech is an important element of Ukraine's development," he wrote. "Once more, I would like to express my sincere apologies to the journalistic community and personally to" the reporters involved.
On October 8, prosecutors announced that Metsher and two other bank employees were being criminally charged in connection with the confrontation with the Schemes reporters.