Ukrainian tycoon accused of $157 million embezzlement scheme

Ukrainian business magnate Ihor Kolomoisky has been served with notice of a third set of allegations following his detention on suspicion of fraud and money laundering.
FILE PHOTO: Ukrainian business tycoon and one of Ukraine's most prominent billionaires Ihor Kolomoisky appears at a court session about a preventive measure against him, amid Russia's attack on Ukraine, in Kyiv September 2, 2023.
FILE PHOTO: Ukrainian business tycoon and one of Ukraine's most prominent billionaires Ihor Kolomoisky appears at a court session about a preventive measure against him, amid Russia's attack on Ukraine, in Kyiv September 2, 2023. REUTERS/Vladyslav Musiienko/File Photo

KYIV (Reuters) -Ukrainian business magnate Ihor Kolomoisky has been served with notice of a third set of allegations following his detention on suspicion of fraud and money laundering, the Security Service of Ukraine (SBU) said on Friday.

A new court hearing on the case in Kyiv on Friday also significantly raised the bail demanded from Kolomoisky, who made his first court appearance earlier this month.

News reports from the court said the judge agreed to raise the bail to be posted to the equivalent of $105 million - compared to an original amount equivalent to nearly $14 million.

Kolomoisky's lawyers had previously said they would appeal his detention and would post no bail.

The new allegations against one of Ukraine's richest men were first reported on Thursday by Serhiy Leshchenko, a former investigative journalist and parliamentarian who now works as an adviser in President Volodymyr Zelenskiy's office.

The SBU, acting with Ukraine's Economic Security Bureau and the prosecutor general's office, said Kolomoisky was suspected of receiving 5.8 billion hryvnias from an alleged scheme to embezzle funds from PrivatBank, which he founded and was a shareholder of.

The sum, currently worth $157 million, was the equivalent of more than $700 million at the time, the SBU said.

Kolomoisky is suspected of setting up an organised group of bank employees to obtain the funds from 2013 to 2014, it said.

Reuters could not immediately reach Kolomoisky or his lawyers for comment on the new allegations. Kolomoisky has in the past denied any wrongdoing.

Kolomoisky is among the tycoons who built their fortunes in the ashes of the Soviet Union and amassed political power in Ukraine's fragile democracy. He is under U.S. sanctions and was once a backer of Zelenskiy, whose election he supported in 2019.

Kolomoisky is a former owner of PrivatBank, which was nationalised in late 2016 as part of a clean-up of the Ukrainian banking system.

He was first served notice of suspicion of fraud and money laundering this month and ordered to be held in custody until the end of October.

Within days, Kolomoisky was identified by the National Anti-Corruption Bureau of Ukraine (NABU) as one of six people suspected of embezzling 9.2 billion hryvnias ($250 million) from PrivatBank.

Zelenskiy is trying to root our corruption and restrict the influence of business magnates as Ukraine strives for membership of the European Union.

($1 = 36.9342 hryvnias)

(Reporting by Anna Pruchnicka; Editing by Timothy Heritage, Mark Potter, Ron Popeski and Tom Hogue)

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