The High Court of England and Wales ruled that Ukraine acted lawfully in nationalizing PrivatBank from its former owners, Ihor Kolomoisky and Hennadiy Boholiubov, after uncovering a $5.5 billion fraud involving sham loans and major capital shortfalls.
The decision sides with PrivatBank in the 8-year, multi-billion-dollar lawsuit begun in 2017.
In 2016, PrivatBank was nationalized as the bank’s regulatory capital had reached negative levels and a $5.5 billion fraud was detected, resulting in a significant loss of funds, according to investigations by Kroll.
The previous owners had refused to add capital to the bank despite repeated requests for them to do so. After nationalization, PrivatBank works as Ukraine’s largest bank in client base (over 19 million clients), revenues, and net income.
Apart from Kolomoisky and Boholiubov, the defendants were three English and three British Virgin Islands (BVI) companies found guilty of facilitating sham loans.
London Court Rules Ukraine Lawfully Nationalized PrivatBank After $5.5B Fraud
The High Court in London found that Kolomoisky and Boholiubov misappropriated $1.9 billion from the bank through “a highly sophisticated re-financing scheme which operated to the benefit of the Individual Defendants [Mr. Kolomoisky and Boholiubov],” PrivatBank’s press release says.
PrivatBank filed a claim in the High Court of England and Wales against its former owners in 2017. The court hearings were between June and November 2023 and the court issued its final ruling on July 30, 2025.
PrivatBank called the decision “a complete victory for the bank.”
It is one of the most influential cases among hundreds of others initiated by Kolomoisky, Boholiubov, and other owners with lesser shares in the bank’s capital.
The final ruling says that Kolomoisky and Boholiubov are responsible for sham loans used to extract funds from the bank – they used them to pay under fictitious supply agreements.
Ruling Marks One of the Largest Civil Fraud Cases in English Legal History
A total of 134 sham loan agreements between the Bank and 50 borrowers extracted $2.3 billion from the bank, with $1.9 billion that was never repaid. The full amount should be returned to the now state-owned PrivatBank as a compensation.
If they fail to pay, PrivatBank will have the right to seize and sell their international assets to recover the debt. Anchoring these actions to a Worldwide Freezing Order is an order issued by an English court, in effect since December 2017.
But its final size is likely to be even larger after the sum is reestimated according to market standards, according to a separate memo PrivatBank sent to reporters about the case details.
PrivatBank wrote in the memo the exact compensation amount is to be decided in October this year, together with interest and legal costs owed under the judgment.
The PrivatBank-Kolomoisky case is one of the largest civil fraud claims ever tried in the English courts and the compensation amount will likely make it one of the largest civil debts ever arising from English legal proceedings.
Both Kolomoisky and Boholiubov denied knowledge of the scheme, claimed the loans had been repaid, and argued that the bank’s claim was time-barred, the bank’s memo says.
But the High Court of England found the Defendants liable for orchestrating a fraudulent misappropriation of around $1.9 billion and ordered them to compensate PrivatBank for the losses.
The court ruled that the defendants could not rely on further fraudulent lending and did not believe the sham loans were repaid, also rejecting the claim that the bank’s lawsuit was time-barred.
While announcing the final decision of the court, judge William Trauer said Kolomoisky “saw himself as above the law” and made serious threats against senior officials of the National Bank of Ukraine (NBU), PrivatBank’s memo says.
According to the memo, Trauer also said that Boholiubov’s approach to his duties at the bank, and his failure to be transparent with “the bank’s auditors, the regulator, and the public at large,” showed “a complete disregard for all normal and ethical standards of commercial behavior.”
The court also ruled that both Kolomoisky and Boholiubov deliberately destroyed data and documentation that could have been relevant to the case.
PrivatBank Ruling Signals End to Oligarch Impunity in Ukraine’s Banking Sector
The news was welcomed by NBU’s governor, Andriy Pyshny.
“The court confirmed that the former owners used fraudulent schemes to withdraw funds,” he wrote in a Facebook post.
After the NBU found out about the fraud schemes costing the bank billions of dollars, Ukraine had to add Hr.155 billion ($5.7 billion in 2016 NBU FX rates) of Ukrainian taxpayers’ money to the capital. They were returned to the state in taxes fully only in December 2023, seven years after the nationalization.
The nationalization in 2016 was necessary as PrivatBank was, and remains, the largest bank in the retail segment – any potential problems with the bank risk damaging Ukraine’s financial stability.
“This was a critical step to preserve the stability of the banking system, as it was the largest systemically important bank in the country,” Pyshny wrote.
The NBU was “actively involved” in the case, the central bank governor said. He said that the case is a precedent for keeping confidence in Ukraine’s banking system, showing that it “protects the rights of depositors and the stability of the financial sector.”
“The business models based on fraud will not work, and justice and truth will be protected by all available legal means,” Pyshny wrote.
The news was also welcomed by the current ambassador to the United States Oksana Markarova, who was First Deputy Minister of Finance and the Commissioner for Investment back in 2016.
“When back in December 2017, our newly appointed Supervisory Board of the nationalized PrivatBank signed this court filing after a year of fruitless attempts at pre-trial settlement, we were hoping for headlines like today’s,” she wrote in a Facebook post.
Markarova wrote that since 2017, the lawsuit has taken “many years of hard work, gathering evidence and testimony, pressure, threats and all the other “pleasures” of fighting for the public interest that especially new people from outside the system face in public office.”
Kateryna Rozhkova, the current First Deputy Governor of the NBU, also reacted with a welcoming reaction on Facebook.
Rozhkova is one of the key figures in the NBU during PrivatBank’s nationalization, as she was part of the team under the previous governor, Valeria Gontareva, who served in the NBU between 2014 and 2017.
In the post, Rozhkova mentioned the individuals who contributed to the success of PrivatBank’s nationalization, as well as the success that followed the High Court of England’s decision. She also thanked Gontareva and the then-president of Ukraine, Petro Poroshenko.
“I want to write about the team that made this possible. First and foremost – the NBU team. Valeria Gontareva and then Yakiv Smoliy [the NBU governor after Gontareva]. Fearless. The President. [Those] who believed in us. And our team. Everyone in the [NBU] Board of Governors,” Rozhkova wrote.
Rozhkova herself faced pressure during the investigation of Kolomoisky and Boholiubov’s fraud conducted by Kroll. In 2021, the Prosecutor General’s Office opened a case against Rozhkova and multiple staff members who had worked on the investigation and the 2016 nationalization of PrivatBank.
The reason for the case was that NBU shared information with companies, including forensic company Kroll Inc., consulting firm AlixPartners and law firms Hogan Lovells and Asters.
“Thank you for this decision. For not being afraid. For chipping away at this rock despite personal threats,” she wrote.