You're reading: Former Irish Ukraina mall owners sentenced to prison

A Dublin court on July 20 sentenced two of the former owners of Kyiv’s Ukraina shopping mall who were found in contempt of court for hiding hundreds of millions of dollars of foreign property from a state-owned Irish bank.

 Sean Quinn Jr.
and his cousin Peter Quinn were handed three-month prison sentences, the latest
twist in the saga in which the Irish state bank is trying to recover $3 billion
in debts it is owed.

The Quinns’ prison
sentences will be indefinite until the contempt of court order is rescinded.
The judge imposed the ruling after finding the Quinns violated a court order
not to meddle with 500 million euros worth of overseas assets, including the
Ukraina shopping center. 

Peter Quinn
didn’t appear for the July 20 sentencing and an arrest warrant has been issued
by Republic of Ireland authorities.

Separately,
Sean Quinn Sr., the last of the three to be found in contempt of court, was not
given a jail sentence but must cooperate with the Irish Bank Resolution
Corporation within three months to halt the movement of assets out of the bank’s
reach.

“These assets
in Ukraine and elsewhere are assets of the Irish people because they are now
under the ownership of the (state-owned) IBRC,” Ireland’s Minister of State for
Public Sector Reform Brian Hayes told RTE’s Week in Politics program.

“We are
determined that that view is known to the Ukrainian authorities. We are
determined that these assets can come under the control of the IBRC so that
ultimately they can be given back to the Irish people,” Hayes said on
television.

But the Quinn
family countered with this statement: “Ireland today is imprisoning people who
have been defrauded of millions by banks whom they have never met or never
borrowed a penny from.” Legal counsel for the Quinns called the sentences
“almost medieval.”

The IBRC has
been trying to take over the
$78 million Ukraina shopping mall as part of a debt recovery plan from the
Quinn family.

However, since April 2011, the
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.

The Kyiv Post has been unable to contact Yanez Puga. The Kyiv Post on
July 10 visited the management office of Ukraina shopping mall but wasn’t let
in and was told by the office manager that Yanez Puga was not on the premises.

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.”

Then lawyers on
July 4 representing IBRC
discovered that the rights to a $45
million debt claim that it  claims
is fraudulent over the
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
Sr.’s family.

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 rights to a $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. 

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