Accessibility links

Breaking News

Ukraine Slaps Sanctions On Oligarch Wanted By U.S. Ahead Of President's Trip To Washington

Ukrainian oligarch Dmytro Firtash (file photo)
Ukrainian oligarch Dmytro Firtash (file photo)

Ukraine has imposed punitive sanctions on Dmytro Firtash, a powerful tycoon indicted by the United States for corruption, as President Volodymyr Zelenskiy widens his crackdown against influential elites ahead of his first official visit to Washington next month.

National Security and Defense Council Secretary Oleksiy Danylov on June 18 announced the sanctions against Firtash, who is currently living in Vienna while fighting extradition to the United States.

In announcing the sanctions, Danylov accused Firtash of selling titanium to Russia's defense industry. Kyiv is engaged in a war against Kremlin-backed separatists in eastern Ukraine that has left more than 13,000 people dead since 2014.

Ukraine's security chief also announced sanctions on businessman Pavel Fuchs over his acquisition of more than a dozen natural-gas fields from a former official tied to the government of former President Viktor Yanukovych, who was ousted in a popular uprising in 2014.

Firtash and Fuchs have been linked to former President Donald Trump's personal attorney, Rudy Giuliani, who sought dirt in Ukraine on President Joe Biden's son, Hunter.

Zelenskiy will meet Biden for the first time in Washington in July.

Danylov did not give details about the sanctions, although they historically freeze an individual's assets inside Ukraine, including bank accounts.

Firtash controls key businesses in Ukraine's chemical, titanium, and natural-gas industries. Forbes this year listed him as the country's 25th-wealthiest individual, with a net worth of $420 million.

The United States indicted Firtash, who is believed to have strong ties to the Kremlin, in March 2014, shortly after Russia seized Ukraine's Crimean Peninsula.

U.S. prosecutors accuse the Ukrainian businessmen of paying bribes to officials in India for licenses to mine titanium, which they planned to sell to U.S. aerospace giant Boeing.

Firtash denies the charges and calls them politically motivated. He is currently seeking a new trial after Austria's Supreme Court upheld his extradition in 2019.

Although he has lived in Austria since 2014, Firtash has continued to prosper financially in Ukraine. He is believed to control around 75 percent of the country's gas-supply companies.

Yuriy Vitrenko, the CEO of the state-owned natural gas company Naftogaz, told RFE/RL earlier this month that he suspected Firtash might be shifting his profits from Ukraine's gas industry to affiliated companies in Western Europe through a scheme known as transfer pricing.

He also expressed concern that Firtash was selling gas he bought at below-market prices from Naftogaz to industrial users in violation of an agreement.

'Hold Them To Account'

George Kent, the deputy U.S. assistant secretary of state who oversees Ukraine, called on Kyiv in April to go after Firtash as part of its anti-corruption agenda.

Kent highlighted Firtash's role as an importer in the 1990s and 2000s of gas from Russia, a business that many officials and analysts have said was rife with graft.

"Why is it that it is the U.S. who indicts and goes after corrupt Ukrainians?" Kent said, referring to the U.S. indictment against Firtash.

"It's time for the Ukrainian leadership and the justice system -- rather than not making decisions against corrupt oligarchs -- to use Ukrainian institutions to go after corrupt Ukrainians and hold them to account," he said.

The Biden administration has made Kyiv's progress on reforms, including fighting corruption, a greater priority in the two countries' relationship.

U.S. officials and analysts have expressed concern about a rollback of Ukraine's reform agenda over the past year, including the dismantling of anti-corruption legislation.

Biden stressed the need for Ukraine to push ahead with tough economic and political changes as well as tackle corruption in a phone call with Zelenskiy on June 7. During the call, Biden extended an invitation to the Ukrainian leader to visit the White House this summer.

When asked a day later by Senator Chris Murphy (Democrat-Connecticut) during a Foreign Relations Committee hearing if there were any reforms that the Biden administration wanted to see Ukraine deliver prior to Zelenskiy's White House visit, Secretary of State Antony Blinken cited several, including a desire to see "people engaged in corrupt practices brought to justice."

In an op-ed posted on the website of the Atlantic Council, a Washington-based think tank, Zelenskiy said his administration would be taking steps to rein in the power of tycoons like Firtash who wield great influence on Ukraine from behind the scenes.

Ukrainian and Western experts blame the tycoons for blocking crucial economic and political reforms that could put the country on a path toward greater prosperity and European integration. They have called for them to be investigated by an independent judiciary amid concern Zelenskiy's use of sanctions could become a substitute to proper legal institutions.

Zelenskiy's administration in February placed sanctions on Viktor Medvedchuk, a powerful tycoon and politician close to Russian President Vladimir Putin, for allegedly helping the separatists in eastern Ukraine.

  • 16x9 Image

    Todd Prince

    Todd Prince is a senior correspondent for RFE/RL based in Washington, D.C. He lived in Russia from 1999 to 2016, working as a reporter for Bloomberg News and an investment adviser for Merrill Lynch. He has traveled extensively around Russia, Ukraine, and Central Asia.

RFE/RL has been declared an "undesirable organization" by the Russian government.

If you are in Russia or the Russia-controlled parts of Ukraine and hold a Russian passport or are a stateless person residing permanently in Russia or the Russia-controlled parts of Ukraine, please note that you could face fines or imprisonment for sharing, liking, commenting on, or saving our content, or for contacting us.

To find out more, click here.