The U.S. Department of Justice has filed a civil forfeiture complaint to seize real estate in Cleveland, Ohio that it alleges was acquired by Ukrainian oligarchs Ihor Kolomoisky and Hennady Boholyubov using funds embezzled from PrivatBank, the largest bank in Ukraine, which the two oligarchs owned before its 2016 nationalization.
The Justice Department announced the complaint in a Dec. 30 statement on its website.
The Cleveland complaint will be the third civil forfeiture document filed against the two oligarchs’ assets in the U.S. Previously, in August, the Justice Department filed complaints in the Southern District of Florida to seize properties in Louisville, Kentucky and Dallas, Texas, which it alleges were also acquired using laundered money.
Read More: US seizure of oligarch Kolomoisky’s property may foreshadow criminal charges
According to the latest complaint, between 2008 and 2016, Kolomoisky and Boholyubov obtained fraudulent loans and credit lines to launder billions of dollars from PrivatBank.
In Miami, Florida, the two oligarch’s associates, Mordechai Korf and Uriel Laber, allegedly “created a web of entities, usually under some variation of the name ‘Optima,’ to further launder the misappropriated funds and invest them,” the Justice Department stated.
“They purchased hundreds of millions of dollars in real estate and businesses across the country, including the properties subject to forfeiture: the office tower known as 55 Public Square in Cleveland, Ohio, the Louisville office tower known as PNC Plaza, and the Dallas office park known as the former CompuCom Headquarters.”
Taken together, the buildings are worth over $60 million, the Justice Department said.
In 2016, the Ukrainian government nationalized PrivatBank amid a two-year cleanup of the banking sector that eliminated over 90 banks from the Ukrainian market. Soon thereafter, a team of forensic auditors with consulting firm Kroll uncovered a $5.5-billion hole in the bank’s ledgers. The Ukrainian government accuses Kolomoisky and Boholyubov of embezzling the money, charges they deny.
Since then, the two oligarchs have been waging a legal battle to regain control over the nationalized bank or receive compensation for it. There are more than 550 cases currently ongoing in different courts. In response, PrivatBank is suing the oligarchs in multiple international jurisdictions.
Read More: What is happening with PrivatBank court cases and why is this such a big deal
Ukrainian prosecutors have been going after Kolomoisky for three years, but with little success. Many of his allies have tried to sabotage the investigation.
For this reason, U.S. involvement likely increases the odds of justice in the case.
“If there was a chance that Kolomoisky could regain control of PrivatBank and stop cases in other jurisdictions, now we know for sure there’s an investigation that he can’t influence from Ukraine,” economic journalist Andrii Ianitsky, who investigated PrivatBank, told the Kyiv Post in August.
The fact that the U.S. filed for civil forfeiture is also a good sign. It means that prosecutors have enough evidence to charge Kolomoisky with a crime, experts said.
In the U.S. civil forfeiture is used as a quick way to seize property that suspects allegedly obtained through crime. It often accompanies money laundering cases.
Because it can be difficult to prove the crimes that underlie money laundering, forfeiture is a useful to reclaim stolen assets, experts said.
“This step of the Department of Justice means that the U.S. is apparently ready to indict the people in question (or maybe has already done so, but not yet announced it publicly),” Artem Shevalev, deputy chairman of the supervisory board at PrivatBank and former deputy finance minister, wrote on Facebook on Aug. 7 about the previous two complaints.
Read More: In Kolomoisky case, US may do what Ukraine never would
