After a former business partner called in hundreds of millions of dollars in loans, a new lawsuit alleges that billionaire oligarch Ihor Kolomoisky begged the creditor not to “beat a man who is down.”

The lawsuit — filed in London by Ukrainian businessman Vadim Shulman and exclusively obtained by the Kyiv Post — accuses Kolomoisky and his partner, Gennadiy Bogolyubov, of stealing more than $500 million from the Kryvyi Rih-born multimillionaire, who made his fortune in the 1990s by moving coal from Donetsk Oblast to factories in Dnipro.

Shulman is demanding repayment from Kolomoisky and Bogolyubov, claiming that they used a 15-year friendship to defraud him in business deals from Russia’s Altai Mountains to Warren, Ohio.

The lawsuit details a trail of self-dealing and lawlessness that extends from the late 1990s to 2016, featuring cameos from ex-Prime Minister and Batkivschyna Party leader Yulia Tymoshenko, Russian oligarch Roman Abramovich, and Vladimir Putin friend Viktor Medvedchuk.


The case, filed in May 2017, offers an inside look at Kolomoisky’s shady “Privat” group of companies and factories. It also provides more detail over how PrivatBank was used as a piggy bank for its owners, and often as a stand-in for Kolomoisky’s own bank account.

The Ukrainian government nationalized the bank in December 2016, pumping $5.5 billion in taxpayer dollars to cover up a gaping hole in the lender’s balance sheet created by a decades-long campaign of embezzlement by the former owners.

Representatives of Kolomoisky and Bogolyubov did not reply to requests for comment. Kolomoisky has denied the allegations in the past.

Who is Vadim Shulman?

The story begins with Shulman’s Soviet career as a coal miner in Krivyi Rih. Thanks to a connection to a top local official, Shulman became responsible for supplying coal from Donetsk Oblast to Dnipro in the early 1990s.

The 58-year-old businessman met Kolomoisky in 1999 through Dmitry Mishalov, a Dnipro-based businessman often associated with Privat.

Vadim Shulman, 57, broke with Ihor Kolomoisky over hundreds of millions of dollars in debts.

From there, Shulman and Kolomoisky invested into joint ventures across Ukraine and around the world, including the Petrovsky Metallurgical Plant in Dnipro and an Ohio steel mill. The pair also formed a friendship that saw them and their families “holiday together every summer and winter.”

Shulman, though claiming huge debts from Kolomoisky and Bogolyubov, has moved most of his business activities out of Ukraine and into the United States in recent years. He owns a San Diego-based company called Pathway Genomics, which develops mobile apps that support genetic testing.

Shulman recently took out a $12.5 million mortgage to buy a $25 million beachside mansion in Malibu, while the Paradise Papers show him dropping $35 million on a brand new private jet in 2012. Documents showed that intermediaries referred to the Krivyi Rih native as “high risk.”

Privat indiscretions

The lawsuit alleges that Kolomoisky began to defraud Shulman from the start of their business relationship: the 2000 sale of the Yuzhny mineral enrichment plant in Krivyi Rih and the Petrovsky steel factory in Dnipro.

At an April 2000 meeting at Shulman’s home in Israel, the lawsuit alleges, Tymoshenko stand-in Alexander Gravets sold a roughly 25 percent stake in the Krivyi Rih factory to both Shulman and Russian-Ukrainian oligarch Vadim Novinsky, allegedly defrauding both at the time that Tymoshenko was in office as deputy prime minister for fuel and energy.


A Tymoshenko spokeswoman declined to comment, while a Medvedchuk spokesman said the political figure would only discuss business issues with the tax authorities.

Novinsky agreed to split the shares with Shulman and Kolomoisky. The lawsuit claims that Kolomoisky then brought in Putin associate Medvedchuk as an intermediary to hold shares in the factory, along with the brothers Igor and Grigory Surkis.

At the same time, the Dnipro clan of oligarchs were struggling to manage three central Ukrainian coking plants: Dneprodzerzhinsk, Bagleykoks and Dneprkoks.

Shulman would manage the coke plants and provide technical staff to Kolomoisky and Bogolyubov to run the Petrovsky steel factory and Krivyi Rih enrichment plants.

Shulman alleges that from 2000 to 2007, he failed to receive his shares of the profits from his stakes in these factories, and that Kolomoisky repeatedly misstated the amount he owned in the factories.

PrivatBank worked as a cash cow to keep the factories running during this time, the lawsuit alleges.

In one episode, the Petrovsky steel mill did not have cash to pay for coke it had received from Privat’s three coking plants.


To “solve” the problem, Kolomoisky allegedly moved cash earmarked for the coke payments into PrivatBank. Shulman, in charge of operating the coke plants, then made a $100 million loan available in exchange for “loans from PrivatBank which were used for the benefit of the Coke Plants,” the case says.

Money, problems

Privat’s control over part of Ukraine’s steelmaking supply chain led to a round of negotiations with Roman Abramovich in 2007.

Abramovich, a billionaire with ties to the Kremlin, offered to buy out Kolomoisky’s stakes in his Ukrainian factories for “$1.06 billion in cash” and 10 percent ownership in Evraz Group SA, one of Abramovich’s companies.

Shulman argues that Kolomoisky essentially ignored Shulman’s stake in the companies being sold to Abramovich during the deal.

After a byzantine set of cash transfers involving PrivatBank’s Cyprus branch and one of Abramovich’s offshores, Shulman claims he was left with $284 million less than he was owed for the sale, taking into account changes in share value over time.

The Evraz deal didn’t push Shulman to break with Kolomoisky. Shulman himself had owed Kolomoisky money at the time, including a $100 million sum related to an unspecified “business investment.”

Rather, it was an investigation into an Ohio steel plant that the two bought in 2001 which led to the split. Along with Bogolyubov, they acquired Warren Steel in Warren, Ohio as part of a plan to gut the plant of its machinery for use in Ukraine.


Shulman claims that in 2012, he launched an internal investigation into whether his co-owners in the plant were dumping their debts onto his ownership stake, and found that $30 million which he had entrusted to Kolomoisky to invest in the firm had disappeared.

The 57-year old, who had spent years apparently trying to collect on various debts owed to him by Kolomoisky and Bogolyubov, started filing lawsuits in the U.S. and the British Virgin Islands.

By summer 2016, Kolomoisky was starting to feel pressure from the impending nationalization of PrivatBank. The oligarch tried to delay, imploring Shulman not to “beat a man who is down” and repeatedly saying he would pay in installments every few months.

But at a spring 2016 meeting in Monaco’s Hotel de Paris, Bogolyubov allegedly suggested to Shulman they wouldn’t pay.

“Just business,” the lawsuit quotes Bogolyubov as saying. “Not personal.”

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