You're reading: Ukraina mall eludes grasp of Irish bank

A state-owned Irish bank has this month discovered yet another layer of Ukrainian-based hurdles in its already year-long attempts to recover debt owed by the family of Sean Quinn Sr., an Ireland-based billionaire-gone-bust.

Lawyers on July 4 representing the Irish Bank Resolution Corporation discovered that a $45 million debt claim over the Kyiv-based Univermag Ukraina shopping mall was on June 22 transferred to a Ukrainian company.

The supplemental loan agreement belonged to a British Virgin Islands company that the Dublin High Court found was actually controlled by a member of Sean Quinn’s family. He was once the Republic of Ireland’s richest man but now owes more than $3 billion to IBRC.

The IBRC has been trying to recover $500 million of foreign properties, including the $78 million Ukraina shopping mall, as part of a debt recovery plan from the Quinn family.

However, since April 2011, IBRC has been thwarted in Ukraine’s courts to take control over Ukraina shopping mall despite being in control of 93 percent of its shares. The bank has suspected the Quinn family of preventing the state-owned Irish bank from seizing the property through agents acting on their behalf.

The Quinns have denied any dishonest or illegal dealings.

Ukraine’s government has labeled the case a classic “raider” attack. Notoriously common in Ukraine and cited as a major obstacle for honest investors, such takers involve exploitation of corrupt courts and muddled legislation to wrestle away control over a business or its assets.

On June 26, former billionaire Quinn Sr., his son and nephew were found in contempt of court in Dublin for transferring and keeping assets, including the Ukraina shopping center, beyond the reach of IBRC in violation of restraining orders issued in June and July 2011.

Judge Elizabeth Dunne said all three had acted in a “blatantly dishonest and deceitful” manner. They were evasive and uncooperative in their evidence to the court, she said.

Dunne concluded that the Quinn family was behind Lyndhurst, the British Virgin Islands company that had a $45 million debt claim over Ukraina shopping mall, and that the company was being used to “strip the assets of Univermag.”

She did not accept Peter Quinn’s evidence – Quinn Sr.’s nephew – that his signature on the debt assignment was forged.

A video has surfaced on The Irish Mail website on July 1, which the newspaper said was authenticated by the FBI, showing Sean Quinn Jr. and Peter Quinn at a meeting in Kyiv’s posh Fellini restaurant on Jan. 21.
During the meeting, Peter, Quinn Sr.’s nephew, admits that he was prepared to lie in a Kyiv court that he never signed a document that transferred the $45 million debt assignment to Lyndhurst.

Both at that time were under restraining orders to desist from transferring assets. The video appears to show that there was a conspiracy within the Quinn dynasty to shift assets.

“I’d have to lie to the court,” he said in the video, laughing. “That wouldn’t overly concern me.”
Also present in the meeting was purportedly Larissa Yanez Puga, the former director of Univermag Ukraina who still controls the shopping center and once was employed by the Quinns, as well as two Russian-speaking males, purportedly lawyers who have worked on behalf of the Quinns and Yanez Puga.
Representing IBRC, Arseniy Miliutin of Egorov Puginsky Afanasiev & Partners (formerly Magisters), told the Kyiv Post on July 3 that the women’s voice in the video was that of Yanez Puga.

At one point during the 15-minute video, one of the Russian-speaking males said that “he speaks directly with Ukrainian courts,” which annoys his competitors. The Russian-speaking male also acknowledged that he had to “speak directly with the judges because otherwise I would lose the court case(s) in Ukraine.”

However, on June 22 a Kyiv city commercial court successfully allowed for Lyndurst’s debt claim to be substituted by Elegant Invest, a company registered in the capital on 11 Spasska Street. This company now has the $45 million debt claim over Univermag Ukraina.

Elegant Invest’s director Ruslan Horbyk refused to answer questions when contacted over the phone on July 5 by the Kyiv Post.

IBRC’s lawyers in Kyiv said they’re currently in consultation with the bank’s officials to determine what action, if any, to take.

Miliutin of Egorov Puginsky Afanasiev & Partners also told the Kyiv Post on July 3 that “he has exhausted many legal options already” in Ukraine.

The judge in Dublin has issued orders to Quinn Sr., Quinn Jr. and Peter to comply with orders otherwise they face jail time.

Regarding the Ukraina shopping mall, they are required to hand over the property, including the certificate of ownership to the Ukraina shopping center, and to cancel all powers of attorney issued to Yanez Puga.

Kyiv Post staff writer Mark Rachkevych can be reached at [email protected].