Oligarch Ihor Kolomoisky’s office in Kyiv was searched by Ukraine’s Security Service (SBU) late on April 22.
The searches were conducted as part of a pre-trial investigation into the embezzlement of over $8 million from the state-owned energy company Centrenergo.
The SBU didn’t name Kolomoisky but said that the case centers around Centrenergo selling electricity below the market rate.
“The SBU is conducting a pre-trial investigation into Centerenergo’s selling of electricity at prices that are 20-30% lower than the cost of (electricity) production. According to detectives, this led to the loss of almost HR 225 million ($8 million),” the Security Service press service told Ukrainska Pravda news outlet.
The case of Centrenergo, which covers 15% of Ukraine’s energy production, is one of the most notorious examples of Kolomoisky’s influence. After President Volodymyr Zelensky took office in 2019, Kolomoisky began milking the company by selling it overpriced gas and receiving cheap electricity in return.
In early 2021, the government replaced the company’s management, reportedly stopping Kolomoisky’s influence on Centrenergo.
Now, it looks like he’s in trouble.
Kolomoisky said he didn’t know what the searches were about, telling Radio Free Europe/Radio Liberty’s journalists that he was in Dnipro, his hometown 500 kilometers away from Kyiv, when the searches occurred.
Kolomoisky also claimed he doesn’t have an “official” office in the building that was searched — the Millenium office center in central Kyiv.
However, he is widely known to work from the building when he’s in Kyiv. He has given several interviews there.
The Millennium business center also has the official offices of four lawmakers close to Kolomoisky: Maksym Buzhansky and Olha Vasylevska-Smaglyuk from Zelensky’s 246-member Servant of the People party, independent lawmaker Oleksandr Dubinsky, who was kicked out of Zelensky’s party, and lawmaker Ihor Palytsia, leader of the Kolomoisky-linked 22-member For the Future party.
It is unknown whether their offices were searched, but Ukrainska Pravda reported, citing its sources, that Prosecutor General Iryna Venediktova authorized four separate search warrants.
An investigation by RFE/RL alleged that the lawmakers’ offices are registered there to grant protection to the building.
The search started at 8:30 p.m. and lasted until 1:40 a.m., according to RFE/RL. The SBU said that it seized documents and electronic storage devices.
Case of Centrenergo
Since Zelensky took power in May 2019, Centrenergo began buying expensive gas from United Energy, which Kolomoisky owns through shell companies. At the same time, United Energy bought cheap gas from the state-owned oil company Ukrnafta, where Kolomoisky has a large minority stake.
United Energy bought more than half of the electricity produced by Centrenergo in 2020 with a 25% discount. As a result, both state companies suffered losses.
The struggling Ukrnafta accumulated a $1 billion tax debt, which it settled in December in a three-way swap between Ukrnafta, its majority shareholder Naftogaz, and the government.
In May 2020, after a year-long court battle with Kolomoisky, the State Property Fund installed industry veteran Oleksandr Korchinsky as Centrenergo’s general director.
It didn’t help. Kolomoisky continued to milk Centrenergo, even though he doesn’t own any shares of it.
According to Bihus.info, the oligarch made $13 million just in 2021 by selling coal from state mines to Centrenergo through pocket shell companies.
In February, the State Property Fund changed the company’s leadership again. Now, Kolomoisky’s United Energy is suing Centrenergo for Hr 148 million ($5.3 million). In turn, Centrenergo alleges that United Energy owes the company Hr 725 million ($26 million) for electricity.
