You're reading: Tymoshenko wants IMF to probe Naftogaz, RosUkrEnergo spending

Dmytro Firtash, co-owner of RosUkrEnergo gas trader, has not responded to latest charges against him.

Yulia Tymoshenko, the former prime minister who came within four percentage points of being elected president in February, called on the International Monetary Fund to investigate the nation’s notoriously murky gas trade before transferring a $1.5 billion second tranche from a $15 billion loan.

In a Dec. 8 open letter addressed to IMF board members, Tymoshenko said Ukraine needs the money, but urged the creditor to investigate recent transactions involving Swiss-based gas trader RosUkrEnergo before approving further assistance.

“The Ukrainian and international communities are well-informed about the activity of RosUkrEnergo and its founders, among which are some odious figures sought by the U.S. Federal Bureau of Investigation,” she wrote in the letter.

Tymoshenko was referring to the alleged ties between the company’s co-owner, Ukrainian tycoon Dmytro Firtash, and reputed Russian crime boss Semyon Mogilevich, who is on the FBI’s Most Wanted List of fugitives and is charged with financial crimes.

A civic activist puts letters from Ukrainian citizens in a box addressed to the International Monetary Fund in Kyiv on Sept. 24, 2010. Over 100,000 Ukrainians signed petitions asking the IMF to control the use of its loans to Ukraine and send a group of experts to look into how the loans benefit RosUkrEnergo, a Swiss-registered company that imports billions of dollars worth of natural gas from Central Asia to Ukraine. (UNIAN)

Firtash issued a strong denial of links on Dec. 2 after WikiLeaks published a cable in which then-U.S. Ambassador to Ukraine William Taylor in 2008 quoted Firtash as admitting business ties with Mogilevich.

Moreover, in an April 2008 memo addressed to FBI director Robert Mueller, the U.S. deputy chief of mission in Moscow, Eric Rubin, more tightly connected Mogilevich with RosUkrEnergo.

“Independent analysis suggests that some members of the security services are allied with various organized crime structures or turn a blind eye to the activities of known criminals… For example, crime boss Sergei Shnaider (better known as Semyon Mogilevich) not only enjoyed freedom of movement in Russian and official protection, but he was brought in by Gazprom to managed gas sales to Ukraine through the shady RosUkrEnergo venture. Only when he lost his political cover, for reasons that are unclear… he was arrested in January 2008,” Rubin wrote.

Ukrainian state energy firm Naftogaz, Russian gas giant Gazprom and RosUkrEnergo reached a deal over disputed gas earlier this month in which Naftogaz returned 12.1 billion cubic meters of gas worth billions of dollars to RosUkrEnergo, and the trader settled debts to Naftogaz and Gazprom. The gas had been appropriated in January 2009 in lieu of a $1.7 billion debt by RosUkrEnergo to Russian state energy giant Gazprom, an obligation purchased by Naftogaz.

Speaking at a press conference at her headquarters in Kyiv, Tymoshenko said the Cabinet of Ministers on Nov. 15 went against national interests by transferring $5.4 billion worth of natural gas from Naftogaz to RosUkrEnergo, following a court decision by the Arbitration Institute of the Stockholm Chamber of Commerce.

Independent analysis suggests that some members of the security services are allied with various organized crime structures or turn a blind eye to the activities of known criminals”

– Eric Rubin, the U.S. deputy chief of mission in Moscow

Tymoshenko said the award, which in her words amounts to 15 percent of the 2011 state budget, will increase the budget deficit to 9 percent, and will force Naftogaz Ukraine, Ukraine’s state-run oil and gas monopoly, into bankruptcy. She said it will burden ordinary Ukrainians, who will be forced to pay higher prices for gas and utilities, and will make it easier for Ukraine’s strategic natural gas pipeline system to fall under Russian control.

Serhiy Taran, director of the Kyiv-based International Democracy Institute, said that Tymoshenko’s appeal to the IMF could score her political points, but it is unlikely to launch an investigation.

“The IMF knows Ukraine very well and does business with Ukraine based on agreements and their own analysis of state finances,” Taran said. “The IMF does not interfere with [allegations of] government corruption.”

By the time the Kyiv Post went to press on Dec. 9, the Kyiv Post had not received a response to Tymoshenko’s allegations from Firtash, his Group DF holding company or his business partner Robert Shetler-Jonese.

Andrey Knutov, a spokesman for RosUkrEnergo, declined to comment on Tymoshenko’s allegations.

“It has been our policy not to comment about what Tymoshenko says about our company,” Knutov said. “If we have a problem with what someone says about RosUkrEnergo, we go to court.”

Kyiv Post staff writer Peter Byrne can be reached at [email protected]