It appears that the stealth invasion of eastern Ukraine is flush with cash. A Ukrainian soldier who had been captured by separatists near the town of Kramatorsk, in a video testimony released by the State Security Service, said he was offered Hr 3,500 per week if he switched sides and $400 to move his family immediately. He said similar offers were made to others.
Prosecutor General Oleh
Makhnytskiy said to Channel 5 on April 16 that his office was
investigating 14 banks for financing pro-Russian separatists in the
east, including the big state-owned Russian bank Sberbank, which has
some 900,000 clients in Ukraine and is Russia’s biggest lender.
Sberbank has strenuously
denied breaking any Ukrainian laws and says it has not received
official notification from Ukrainian authorities regarding the
accusations. On April 18, the bank’s Ukrainian subsidiary said that
an internal investigation revealed “no cases of breaching any laws
of Ukraine.”
Meanwhile, the State Border
Service says it has captured money mules carrying large amounts of
cash meant for delivery to Kremlin-backed insurgents in the troubled
eastern regions.
The sums involved are
significant. On April 15 the State Border Service announced that it
caught four Ukrainian passengers carrying Hr 1.8 million ($140,000)
in cash on a Dnipropetrovsk-bound train from Simferopol, the capital
of Crimea, while on April 17 three citizens from Sevastopol were
detained at the Melitopol checkpoint in Zaporizhya Oblast between
Crimea and the mainland also on their way to Dnipropetrovsk, where
they were found to have almost Hr 5 million ($400,000) hidden in
secret pockets.
The Simferopol group said
they were on their way to a wedding, but after questioning them
separately the border guards heard conflicting stories, and
eventually admitted they “were couriers supposed to deliver the
money to the anti-Ukrainian demonstrations in the eastern regions of
Ukraine,” the State Border Service said.
On April 15 the Security
Service of Ukraine (SBU) stated that a single unnamed Russian bank
illegally converted some Hr 45 million ($3.75 million) into cash in
March-April allegedly to facilitate the Kremlin-backed separatist
movement in eastern Ukraine.
Since the Prosecutor
General’s dramatic announcement, it has thus far named four of the
suspected 14 banks: Sberbank, Prominvestbank, Vnesheconombank, and
VTB Bank, Interfax-Ukraine reported on April 17.
The SBU is investigating
them for violating the law on “crime and terrorist financing.”
All the banks deny
committing any malfeasance. In a statement released on April 17,
Sberbank’s local subsidiary said: “Sberbank of Russia is a
Ukrainian commercial bank that operates strictly under Ukrainian law
and international legislation are strictly observed with reference to
the recommendations of FATF (Financial Action Task Force on Money
Laundering). The bank does not have any relation to the situation.”
However, on April 16 the SBU
showcased items that it found on more than 40 captured Russian
military intelligence officers, as well as Russian and Ukrainian
agents working on their behalf, that included four Sberbank payment
cards. The Kyiv headquarters of an unnamed Russian financial
institution, according to the SBU, transfers between $200 and $500
daily to payment cards held by “terrorists” in violation of the
law on “Prevention and Counteraction of the Laundering of Proceeds
from Crime and Terrorist Financing.”
This corresponds with a
report carried by Ukrinform that said separatist organizers were
paying its “fighters” $500 for storming government buildings and
Hr 500 for participation in rallies near the seized buildings.
Also, capital.ua news portal
reported that in recent months many social network groups have been
calling for funds to support causes related to separatist movements
in different regions of the country. For example, to transfer aid to
separatists, a specified account of the Ukrainian subsidiary of
Sberbank of Russia and remittance systems (Yandex Money, QIWI) are
given. The Financial Monitoring Service of Ukraine in early March
reported that it had blocked the charity 35th Shore Battery (Crimea),
which was used to fund residents of Sevastopol. The state agency
deemed the fund’s activity to be suspicious.
Several Russian banks have
refuted accusations of foul play, even ones that haven’t been
publicly accused, such as Alfa Bank.
On April 16 Alfa-Bank
(Ukraine), which is part of the Alfa-Group international consortium
with large assets in Russia, was even more strident in its denial.
“Information presented by the press on anti-Ukrainian operations of
Alfa-Bank, relations with the Federal Security Service [of Russia] …
are part of a black PR campaign,” the bank said.
Like Sberbank, Alfa-Bank has
not heard anything directly from the state security apparatus. “There
are no claims against the operation of Alfa-Bank (Ukraine) from the
National Bank, law enforcement agencies, or SBU. We, as the whole
financial sector of Ukraine, are waiting for the results of the SBU’s
investigation into the involvement of a Russian bank in financing
separatists,” the statement concludes.
VTB Bank, meanwhile,
declared that it acts in line with Ukrainian law and the licenses of
the National Bank of Ukraine and carries out only commercial
activities. “Any attempts to accuse the bank in the participation
in the political life in Ukraine are absolutely groundless,” the
bank said in a press statement.
There are eleven banks on
the Ukrainian market with Russian capital:
Sberbank Russia
Prominvestbank
VTB Bank
Alfa Bank
Russian Standard
Energobank
Folksbank
Petrocommerz Ukraine
Trust
Interbank
Finance Bank
Kyiv
Post staff writer Evan Ostryzniuk can be reached at
[email protected].
Kyiv Post editor Mark Rachkevych contributed reporting.
