You're reading: Khoroshkovsky has his say on conflicts

Security Service of Ukraine chief Valery Khoroshkovsky is at the center of a storm of accusations that he is interfering with press freedoms.

Khoroshkovsky is also criticized for his numerous conflicts of interest as a top law enforcement official who owns the country’s largest media group and who serves on the council that appoints judges.

Khoroshkovsky appeared on Savik Shuster’s weekly political talk show on Ukraina TV channel on June 11, and then gave an interview to Ukrayinska Pravda’s online newspaper. Both the show and interview were dedicated to the issue of freedom of speech and freedom of assembly.

Executives of two small stations, Channel 5 and TVi, have accused Khoroshkovsky of using his position as chief of the SBU, as the Security Service of Ukraine is known, and as a member of the High Council of Justice to pressure a court that on June 7 stripped these channels of broadcasting frequencies. The frequencies were awarded in a controversial January tender. The two channels said the move threatened their development and possibly even existence.

U.S. and European officials say they are monitoring the conflict closely, while Gilles Lordet, head of the Paris-based media watchdog Reporters Without Border, said on June 9 that it is “an unacceptable situation” when the chief of the nation’s state spy agency doubles as the owner of the country’s largest television group.

Below are some of the highlights of the June 11 Shuster Live show.

Valery Khoroshkovsky: “This is just one point of view. If we are talking about conflict of interest, we should take a broader perspective. Society’s biggest problem today is corruption, which is based on bureaucracy. This leaves us to choose between two evils: bureaucracy with corruption or businessmen with conflicts of interest. Which is better? What compromises should we make? I think that resolving the issue depends of individual conscience and positioning.”

TVi director Mykola Kniazhytsky: “I am amazed by the choice you say we face. I want to live in a Ukraine where bureaucrats are not corrupt and businessmen don’t have conflicts of interest. I view you as a bureaucrat with a conflict of interest. I remember when [Prime Minister] Yulia Tymoshenko appointed you to head the customs service, introducing you as a wealthy individual who did not need to steal. … Today you say that you are the owner of Inter … and Inter is suing us in court. This illustrates a conflict of interest because you have influence over the courts. You appoint judges. Also, the law on the High Council of Justice says that members must have 10 years experience working as a lawyer.
Your tenure as economy minister [November 2002-January 2004] does not meet this requirement. This is absurd. So I have come to the following conclusion: You are a corrupt bureaucrat and a businessman with conflicts of interest.”

Khoroshkovsky: “Thank you for offering that observation. Let me attempt to sort out the issues for you. For starters, I, like you, would prefer a Ukraine where bureaucrats are not corrupt and businessmen don’t have conflicts of interest.
… My reaction to allegations that I influenced the court decision was to ask for proof backing them up. Show me the evidence to back up charges of any impropriety and I will respond. I accept that there is a potential for the conflict of interests. But let me declare publicly here and now that Inter has declined frequencies it received in the tender and will not seek to acquire these frequencies in any future tender. So I am stepping aside and giving the opportunity to Channel 5 or TVi or any other media groups to acquire this bandwidth. … I did not familiarize myself with the details of the court case. But since you brought up the subject of the tender, the court has ruled. It was illegal. You can appeal the decision. I want society to know that there were many manipulations and speculations that [the authorities] intend to close Channel 5, are preventing TVi from developing, and that this is an attack on freedom of speech. The frequencies won in the tender covered a mere 1 percent of Ukraine’s territory, but later, without the permission of the National Council for Television and Radio Broadcasting, the bandwidth was expanded and strengthened to cover the whole country for an additional cost of $10 (Hr 86). … The market price for licenses to broadcast on each set of these enhanced frequencies is about $100 million, which would go into the country’s budget. So let me ask a question. Should society agree to sell these new frequencies for $10 so that we can talk about freedom of the press?”

Oleh Lyashko, parliament deputy from Yulia Tymoshenko’s bloc: “You are telling people that you are not familiar with the details of the court case. But most people don’t know that following changes to the law on the High Council of Justice, its members – and you are one of them – are viewed by judges as gods and tsars. Knowing that you are a member of the council, any judge who knows you have an interest in Inter TV, will, of course, rule in your favor.”

Khoroshkovsky: “Unfortunately, I can’t be reborn. I am prepared to sell my business [U.A. Inter Media Group]. Who will buy it?”

Lyashko: “[Ukrainian billionaire Dmytro] Firtash?” [Editor’s Note: Firtash is seen by many as a partner of Khoroshkovsky, who admits that the natural gas trading billionaire has an option to own half of his U.A. Inter Media Group.]

 

Vitaly Portnikov, chief editor of TVi, (UNIAN)

Vitaly Portnikov, chief editor of TVi: “I think you and your friends are confusing people. The topic of frequencies isn’t very interesting to people. This is obvious, isn’t it? Let me tell people what is actually going on in the country, because this is what is most important. You have given us, journalists, a great lesson, that different points of view should be examined and considered, including your own. This much is true.But the most important task for journalists is to tell the truth. There are still journalists out there who have not been bought by businessmen or employed to work in the interest of this or that special group. They are a few of them left, but they do exist, and they can tell the truth. And what is the truth? The truth is that big businessmen in Ukraine don’t know what to bet on . . . and are distraught about it. For some, $800 million is a great deal of money, and for others nothing less than $1 billion will do. The problem these big businessmen all have is how to protect their money. How can you protect your fortunes? There are three ways. The first is to occupy a high government post, such as you, as SBU chief do. The second way is to fully control the court system, which you do as a member of the High Council of Justice. A third way is to control the country’s information sphere. Businessmen who do this will be in high demand. You were deputy SBU chief for former President [Viktor] Yushchenko, SBU chief for Viktor Yanukovych and you will occupy an important post for the next president, it might even be you, that is, if you’re interested in the job. […] Ask Yanukovych or the next president if it’s possible to have not just Inter TV to influence people, but three channels doing it. You know perfectly well that if there is an alternative, you, businessman Khoroshkovsky, will not be needed by any president. And you will lose your business. We have to create a Ukraine where businessmen don’t have to defend their wealth by being appointed to a high government post […] Listen, when you began your political career and teamed up with Inna Bohoslovska to form the Winter Crop Generation [for the parliamentary election in 2002], I thought the seeds would grow into a new type of politician, but vampire teeth grew instead. [Addressing the audience] People, we will live they way we do now until we can defang these people.”

Khoroshkovsky: “As regards to my income, I have declared it publicly for the past decade. […] This is easy to check. […]”

Petro Poroshenko, politician and owner of Channel 5 : […]“You should be temporarily suspended as SBU chief for the duration of the court hearings and an internal investigation and an ad hoc parliamentary investigation committee should look into the matter. The decision on whether to reinstate you should be taken after the results of the probe are reported.”

[Khoroshkovsky leaves the studio]

Bohoslovska: “[…] I am glad that [Portnikov] mentioned the Winter Crop Generation. The image of the current SBU chief is a lot better than those of his crummy predecessors, who avert their eyes and refuse to answer where they got their money from. […] You want to tell us that the press has been free and fair, that Channel 5 was fair? […]”

Portnikov:
“Inna, tell the audience the truth. Did we take money from you for coverage? No. Without honest media, there will be no new roads, hospitals and schools. Because media will be reporting that we already have them. People will live on their $100 salaries, while [Khoroshkovsky] sits on his $800 million. For as long as journalists are prevented from telling the truth, nothing will change in Ukraine. […]”

Who controls Ukraine’s media today?

Media experts say four financial and political groups currently dominate the television sector. They are billionaire gas trader Dmytro Firtash and Valery Khoroshkovsky, who control the U.A. Inter Media Group, of television channels (Inter, NTN, K2, K2, Megasport), billionaires Viktor Pinchuk (STB, Novy Kanal, ICTV), Rinat Akhmetov (TRK Ukraina) and Igor Kolomoisky (1+1). The owners of the television channels are all regarded as loyal to the government, which – under the Party of Regions – controls the executive, legislative and judicial branches.

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