The Pechersky District Court in Kyiv delayed a hearing on summoning oligarch Igor Kolomoisky on behalf of an Israeli court on Aug. 13. The judge did this for the second time in a row, according to Ukrainian state-owned PrivatBank, the plaintiff in the case.
In the Israeli case, PrivatBank is seeking to retrieve $600 million that the Ukrainian government claims was stolen by the bank’s former owners, Kolomoisky and his business partner Gennadiy Boholyubov, allegedly with the help of Israel’s Discount Bank.
The $600 million in question is a small portion of the $5.5 billion that Kolomoisky and Boholyubov allegedly embezzled in an insider-lending scheme and parked overseas. In December 2016, the state nationalized the nearly insolvent PrivatBank after the fraud was discovered.
The court’s failure to summon Kolomoisky threatens to delay the Israeli case, creating another obstacle in PrivatBank’s quest for recoup its losses.
Kolomoisky and Boholyubov could not be reached for comment. Both have previously denied any wrongdoing and are attempting to reclaim PrivatBank.
In a December 2019 phone interview with the Kyiv Post, Kolomoisky called the Israeli case “bullshit.”
“They’re just wasting your money,” he said.
Mystery meeting
Since PrivatBank came under state control, its new management has been suing its former owners in courts around the globe — in the United States, the United Kingdom, Cyprus and Israel.
In December 2019, the bank filed the $600 million claim to the Tel Aviv-Jaffa District Court. Since then, judge Khaled Kabov has held several hearings, but he needed Ukraine to assist him.
His colleagues in Kyiv, however, do not appear to be in any hurry to help him move forward with the case.
On July 16, the Pechersky District Court registered an official Israeli court request asking it to hand legal documents and a summons to Kolomoisky.
Judge Tetiana Ostapchuk scheduled a hearing for July 30. But then the lawyer representing Kolomoisky failed to appear, so she delayed the hearing until Aug. 13, according to PrivatBank.
This time, Kolomoisky’s lawyer was there. After he spoke with Ostapchuk in her office behind closed doors, the judge delayed the hearing once again, PrivatBank told the Kyiv Post in a statement.
“A representative of PrivatBank witnessed a lawyer acting for Kolomoisky entering the office of judge Ostapchuk. Soon the lawyer left and Ostapchuk went out to the court’s corridor and announced that she was not allowing PrivatBank to be present at the open-to-the-public court hearing,” the statement reads.
“The hearing did not take place, and the person who said he was representing Kolomoisky was gone,” it continues.
Neither the Kyiv Post, nor its sources in PrivatBank were able to identify the lawyer who represented Kolomoisky in the meeting with Ostapchuk.
Ostapchuk postponed the court hearing until Sept. 21, slowing the Israeli case and providing Kolomoisky with another month to decide on his defense strategy.
Israeli litigation
The Israeli court is scheduled to hold its next hearing on Oct. 15.
The Tel Aviv claim accuses the two Ukrainian oligarchs of fraud and embezzlement and also names Discount Bank, one of Israel’s largest banks, as a defendant in the complaint. According to the PrivatBank’s lawsuit, Discount Bank had to understand that the transferred funds were of “toxic” origin.
Kolomoisky and Boholyubov allegedly stored the embezzled funds in the Israeli bank.
The accounts, held by an alleged shell company named in Israeli court documents as St. John, are said to have received $1.2 billion in fraudulent transfers from Cyprus between 2007 and 2011.
Kolomoisky and Boholyubov are Israeli citizens. Kolomoisky has a residence and office in Herzliya Pituah, an affluent beachfront neighborhood in Tel Aviv District.
The lawsuit, which Israeli media report was filed on behalf of state-owned PrivatBank and the Ukrainian government, demands repayment “for damages done… by those acts of embezzlement and fraud” and money “smuggled to Israel and deposited in a bank account managed by a shell company in Israel.”
