Editor’s Note: This story was originally published by OCCRP, a Kyiv Post partner.
Two Soviet-born Florida businessmen — one linked to a Ukrainian tycoon with reputed mafia ties — are key hidden actors behind a plan by U.S. President Donald J. Trump’s personal attorney to investigate the president’s rivals.
Trump’s attorney, former New York Mayor Rudy Giuliani, said in May that he planned to visit then-incoming Ukrainian President Volodymyr Zelensky to win support for probes into potentially damaging claims raised by senior Ukrainian officials.
Among them was the misleading contention that Trump’s main 2020 Democratic rival, Joe Biden, improperly pressured Ukraine’s government to fire a top prosecutor; that American diplomats in Ukraine had exhibited pro-Democrat bias; and that local officials conspired to undermine Trump’s presidential campaign and help Hillary Clinton in 2016.
Giuliani set off a firestorm in the conservative media by promoting the allegations.
“We’re not meddling in an election; we’re meddling in an investigation, which we have a right to do,” he told the New York Times.
The claims he was pressing have since largely been debunked, but remain politically potent as the next U.S. elections approach.
Within days of announcing the planned trip to Ukraine, Giuliani called it off amid a storm of criticism that he was inappropriately interfering in U.S. relations with a foreign country. His efforts in Ukraine, however, have continued.
At the center of Giuliani’s back-channel diplomacy are the two businessmen, Lev Parnas and Igor Fruman, who Giuliani has publicly identified as his clients.
Until now, the men have escaped detailed scrutiny. But a joint investigation by the Organized Crime and Corruption Reporting Project (OCCRP) and BuzzFeed News, based on interviews and court and business records in the United States and Ukraine, has uncovered new information that raises questions about their influence on U.S. political figures.
Both men were born in the Soviet Union and immigrated to the United States. Parnas came with his family at the age of four. Fruman first arrived as a young adult in the 1980s, but later moved to Ukraine and established a series of businesses. Both now live in South Florida.
Since late 2018, the men have introduced Giuliani to three current and former senior Ukrainian prosecutors to discuss the politically damaging information.
The effort has involved meetings in at least five countries, stretching from Washington, D.C. to the Israeli office of a Ukrainian oligarch accused of a multi-billion dollar fraud, and to the halls of the French Senate.
Parnas and Fruman’s work with Giuliani has been just one facet of their political activity.
Since early last year, the men have emerged from obscurity to become major donors to Republican campaigns in the United States. They have collectively contributed over half a million dollars to candidates and outside campaign groups, the lion’s share in a single transaction that an independent watchdog has flagged as a potential violation of electoral funding law.
The men appear to enjoy a measure of access to influential figures. They’ve dined with Trump, had a “power breakfast” with his son Donald Jr., met with U.S. congressmen, and mixed with Republican elites.
Months before their earliest known work with Giuliani, Parnas and Fruman also lobbied at least one congressman — former U.S. Rep. Pete Sessions, a Texas Republican — to call for the dismissal of the United States’ ambassador to Ukraine, Marie Yovanovitch. She stepped down a year later after allegations in the conservative media that she had been disloyal to Trump.
While setting up meetings for Giuliani with Ukrainian officials, the men also promoted a business plan of their own: Selling American liquefied natural gas to Ukraine to replace Russian imports disrupted by war.
In a series of interviews, Parnas said he and Fruman weren’t paid by anyone for their work in Ukraine and that he and his partner have done nothing illegal.
“All we were doing was passing along information,” he said. “Information coming to us — either I bury it or I pass it on. I felt it was my duty to pass it on.”
He said their political activities were motivated by sincere conviction that they had uncovered wrongdoing that should be investigated.
“We’re American citizens, we love our country, we love our president,”he said.
The men make for unlikely back-channel diplomats. Parnas, 47, is a former stockbroker with a history of unpaid debts, including half a million dollars owed to a Hollywood movie investor. Fruman, 53, has spent much of his career in Ukraine, and has ties to a powerful local businessman reputed to be in the inner circle of one of the country’s most infamous mafia groups.
Giuliani and Fruman didn’t respond to multiple requests for interviews or to written questions. The White House did not respond to a request for comment.
Kenneth McCallion, an ex-federal prosecutor who has represented former Ukrainian Prime Minister Yuliya Tymoshenko in U.S. court, said that Parnas and Fruman were “playing with fire” by lobbying in the United States and Ukraine without registering as foreign agents.
“Trump has either authorized Giuliani to engage in private diplomacy and deal-making, or even worse, remains silent while Giuliani and his dodgy band of soldiers of fortune engage in activities that severely undermine U.S. credibility and are contrary to fundamental U.S. interests,” McCallion said.
‘It Opened Giuliani’s Eyes’
Parnas and Fruman’s work with Giuliani has largely centered on efforts to connect the president’s personal attorney with current and former senior Ukrainian prosecutors believed to hold information harmful to Trump’s rivals.
In late 2018, Parnas and Fruman organized a Skype call between Giuliani and Viktor Shokin, who served as Ukraine’s prosecutor general until he was dismissed by parliament in 2016 amid allegations he was blocking anti-corruption efforts.
Parnas and Giuliani visited the French Senate building, where Giuliani attended a meeting that included Nazar Kholodnitsky, the head of Ukraine’s Special Anti-Corruption Prosecutor’s Office, according to social media posts and interviews. (Kholodnitsky has faced calls to step down after wiretaps in his office last year allegedly caught him interfering in corruption cases.)
By the new year, Parnas said, he and Fruman had also connected Giuliani with Shokin’s replacement as top prosecutor, Yuriy Lutsenko. The Ukrainian official and Giuliani met in New York in January and again in Warsaw the following month.
“[Lutsenko] brought documentation, verification. It opened Giuliani’s eyes,” Parnas said.
Shortly after their February meeting in Poland, both Lutsenko and Giuliani began airing a series of allegations in the U.S. media.
In March and April, the online publication The Hill published a series of opinion pieces largely based on an interview with Lutsenko. The articles relayed the allegations about the Bidens, and went further.
Lutsenko also claimed that officials at the U.S. Embassy in Kyiv had worked with Ukrainian law enforcement to interfere in the 2016 U.S. election by coordinating the disclosure of the so-called “black ledger,” a document that appeared to detail millions of dollars in secret payments from Ukraine’s former ruling party to Paul Manafort, then Trump’s campaign manager. Some of those payments were later verified to be real.
The revelation of the black ledger in 2016 contributed to Manafort’s resignation from the Trump campaign, and helped lead to his prosecution and conviction by Special Counsel Robert Mueller. Since then, prominent Trump supporters have used allegations that the ledger’s disclosure was motivated by anti-Trump bias to cast doubt on the origins of Mueller’s investigation into Russian interference in the 2016 election.
Lutsenko also told The Hill that Yovanovitch, who was still the U.S. ambassador to Ukraine, had handed him a “do not prosecute” list at their first meeting. The Hill characterized the claim as evidence that Yovanovitch was favoring Democrats in the middle of a presidential election because the purported list contained the names of supposed Democrat allies in Ukraine’s parliament and civil society groups.
The State Department has forcefully rejected the claims. In a statement, the U.S. Embassy in Kyiv told reporters: “The allegation of a ‘do not prosecute’ list is an outright fabrication. Such allegations only help the corrupt.”
Still, the allegations caught like wildfire in U.S. conservative media, and were amplified by Giuliani in a series of interviews with cable news and newspapers.
Trump called claims that Ukrainian officials had helped Clinton’s candidacy “big” and “incredible” in an April interview with Fox News, and said that he would leave it to Attorney General William Barr to decide whether to look into them. Barr announced a probe into the origins of the Mueller investigation — in which Manafort’s Ukrainian work became a focus — the following month.
Parnas said he expected all the information he and Fruman had helped advance to become an important part of Barr’s inquiry, and that it would dominate the debate in the run-up to the 2020 election.
“It’s all going to come out,” he said. “Something terrible happened and we’re finally going to get to the bottom of it.”
Debunked But Not Dead
Experts have largely dismissed most of the allegations raised by the prosecutors and relayed by Giuliani as being at best unfounded, and at worst deliberate disinformation.
Both Shokin and Lutsenko are widely viewed among Ukrainian reformers as lacking credibility, and civil society groups have accused them of covering for suspects in major corruption cases.
Joe Biden had indeed pushed for Shokin’s dismissal, threatening that the U.S. would withhold $1 billion in loan guarantees if he remained.
“I looked at them and said: ‘I’m leaving in six hours. If the prosecutor is not fired, you’re not getting the money,’” Biden recounted in a 2018 speech at the Council on Foreign Relations. “Well, son of a bitch. He got fired.”
However, Biden was not alone in his disdain for Shokin. The former top prosecutor was dismissed by parliament after a chorus of criticism by European diplomats and international organizations, and even street protests calling for his resignation.
Local anti-corruption activists had become convinced Shokin was quashing investigations into Burisma’s owner, Mykola Zlochevsky, and other oligarchs, said Daria Kaleniuk, the director of the Anti-Corruption Action Center, a Ukrainian transparency group.
“Shokin was not dismissed because he wanted to investigate Burisma,” Kaleniuk said. “Quite the contrary. He was dismissed because of a lack of willingness to investigate this particular case as well as other important cases involving high-level associates of [ousted former President Viktor] Yanukovych.”
As for Lutsenko, Kaleniuk said his claims were likely motivated by a desire to hold on to his job as top prosecutor with the incoming Zelensky administration, as well as to find friends in the United States government, where he has long been viewed as toxic.
“He wanted to become a person with whom people in the United States wanted to talk, and then probably he found Giuliani and found a sexy story that fit into the Giuliani agenda,” Kaleniuk said.
Hunter Biden’s work for Burisma, however, still raises eyebrows in Ukraine. The younger Biden’s paid tenure on Burisma’s board came at a time the company and its owner faced multiple corruption investigations. He was likely hired simply to impart his famous last name, Kaleniuk said.
“I think [working for Burisma] was wrong from an ethical point of view,” she said.
In a statement, Hunter Biden defended his previous position on Burisma’s board, saying he worked to help reform the company’s “practices of transparency, corporate governance and responsibility.”
“At no time have I discussed with my father the company’s business, or my board service. Any suggestion to the contrary is just plain wrong,” Biden said.
There is also no known documentary evidence that U.S. officials had worked with Ukrainians to release the black ledger.
Though Giuliani’s visit was canceled and many of his claims debunked, the allegations emerging from Ukraine remain very much alive in the lead-up to the 2020 U.S. election.
The accusation that Yovanovitch had exhibited political bias was reported to be behind her stepping down as ambassador in May.
Lutsenko and Shokin did not respond to requests for interviews. Reporters were unable to reach Yovanovitch.
From the Black Sea to Boca
The previous business dealings of both Parnas and Fruman raise serious concerns about their newfound access to senior American political figures.
A resident of upscale Boca Raton, Parnas once ran an electronics business that was successfully sued for its role in a fraudulent penny stock promotion scheme. He has also worked for three brokerages that later lost their licenses for fraud and other violations. He has never been personally charged.
Court records also show that judges have awarded a series of default judgements against Parnas for multiple unpaid debts. These include over $500,000 he owes to an investor in a Hollywood movie that he had promoted but was never made. He has also been sued a dozen times over the last decade for failing to pay rent on various Palm Beach County properties and has been evicted from two homes.
Fruman’s backstory is even more colorful.
His network of businesses extends from the United States to the city of Odesa, a Ukrainian Black Sea port notorious for corruption and organized crime.
Reporters found that Fruman has personal ties to a powerful local: Volodymyr “The Lightbulb” Galanternik, a shadowy businessman commonly referred to as the “Grey Cardinal” of Odesa.
Galanternik is described by local media and activists as a close associate of Gennadiy Trukhanov, the mayor of Odesa who was shown in the late 1990s to be a senior member of a feared organized criminal group involved in fuel smuggling and weapons trading.
Galanternik also owns a luxury apartment in the same London building as the daughter of another leader in the gang, Aleksander “The Angel” Angert, OCCRP has previously reported.
Vitaly Ustymenko, a local civic activist, describes Galanternik as an overseer of the clique’s economic domination of the city.
“[Galanternik] is not ‘one of the’ — he is actually the most powerful guy in Odesa, and maybe in the region,” Ustymenko said.
Fruman’s recent ex-wife, Yelyzaveta Naumova, is the self-declared best friend of Galanternik’s wife, Natasha Zinko, according to her Instagram posts. Galanternik and Zinko also celebrated the New Year in 2016 with the Frumans in South Florida, according to a photo posted online by an acquaintance of Fruman.
Galanternik’s name is seldom tied directly to his businesses. Instead he operates via a network of offshore companies and trusted proxy individuals. But there are signs that either Fruman or his long-standing local partner, Serhiy Dyablo, may have a business relationship with Galanternik via two Odesa firms (see box).
In an interview, Parnas said that Fruman and Galanternik knew each other through their wives, but said there were no business connections between the two men.
Galanternik and Fruman did not respond to written questions. Neither Dyablo nor Naumova responded to multiple requests for interviews.
“Where is the money coming from?”
Parnas and Fruman’s work with Giuliani was just one part of a broader foray into U.S. politics.
In 2018, the men made hundreds of thousands of dollars in donations to Republican causes while enjoying VIP access to party and Trump administration circles.
Filings with the U.S. Federal Election Commission (FEC) show that Fruman and Parnas spread their money widely.
Fruman kicked off the effort on Feb. 20, giving $2,700 each to two pro-Trump groups, Trump Victory and Donald J. Trump for President.
Less than two weeks later, Fruman and Parnas attended a fundraiser for Trump’s re-election at his Mar-a-Lago club in Palm Beach, Florida.
This was followed by a several-month-long spree of donations — of a total value of at least $576,500 — to campaigns including the successful 2018 Senate bid of former Florida governor Rick Scott, and the re-elections of Texas Representative Pete Sessions and South Carolina Representative Joe Wilson. All are Republicans.
The lion’s share of these donations, however, was just one $325,000 payment, made on May 17, 2018, to America First Action. The group is one of the largest pro-Trump Super Political Action Committees (commonly known as Super PACs), a kind of outside campaign organization that is allowed to raise unlimited funds in support of a candidate, but is barred from working directly with their campaign.
That payment was declared as coming from a Delaware company, Global Energy Producers LLC, set up by Fruman and Parnas just weeks before as part of their plan to sell gas to Ukraine.
The donation is subject to an ongoing complaint to the FEC by the Campaign Legal Center, a watchdog group, alleging the company is likely a shell intended to hide other donors.
Parnas said the complaint was unfounded. “We have a real business,” he said.
Parnas said the contributions were designed to get the attention of key lawmakers at a time he and Fruman were launching their gas export business. “We’ve got a business. We just want to get recognized,” he said.
However, Parnas and Fruman’s plans to sell American gas to Ukraine has so far not borne fruit. In response to inquiries, Naftogaz, Ukraine’s natural gas monopoly, said that Global Energy Producers has not participated in any tenders to sell gas to Ukraine and has concluded no contracts. The company’s website contains only a countdown timer that has already reached zero.
The donation ascribed to Global Energy Producers in fact came from the bank account of another company belonging to Parnas. Days earlier, that company had received a wire transfer of $1.26 million from the trust fund of a Florida lawyer who specializes in real estate, court records show.
Parnas said that money came from the sale of a Florida condominium, but did not provide documents to back up his claim.
Within months of Parnas and Fruman’s six-figure donations, and even as their work with Giuliani began, allegations emerged in a public lawsuit in Florida that they had jilted an early investor in their Ukraine gas venture.
Felix Vulis, the head of Eurasian Natural Resources Corporation, a firm owned by a trio of Kazakhstani oligarchs, asserted that Parnas and Fruman had failed to repay a two-month $100,000 loan he had given to Global Energy Producers earlier in the year. The two men had boasted about their relationship with Guiliani and other influential figures while asking for the loan, according to the complaint.
Vulis has yet to be paid, according to his lawyer, Robert Stok.
The men said “they had all this influence,” Stok said. “They said Trump and his associates were going to back their company. That they had direct access to the White House.”
Tony Andre, a Florida lawyer who has been trying to collect the $500,000 movie deal judgement against Parnas, also expressed astonishment at what he sees as the businessman’s brazenness.
“Someone takes a half million dollars from you and he’s hanging with the president and the president’s lawyer,” Andre said.
“I’ve never seen anything like this,” he said. “Where is the money coming from?”
Dinner with the President
Amid their donation spree, Parnas and Fruman took part in an impressive series of meetings with senior Republicans.
On or about May 1, 2018, while staying at the Trump International Hotel in the U.S. capital, both men had dinner with the president in a meeting documented by Parnas in a now-deleted Facebook post.
Later that month, the two men had a “power breakfast” in Beverly Hills with Donald Trump Jr. and Tommy Hicks Jr., who has since become co-chair of the Republican National Committee, according to a now-deleted Facebook post by Parnas. At the time, Hicks was head of America First Action, which had received the men’s $325,000 donation in the same month.
Parnas also had meetings in May on Capitol Hill with several Republican congressmen.
Among them was Sessions, the Texas Republican, according to a now-deleted May 9 Facebook post by Parnas. In a meeting also attended by Fruman, the two men urged the dismissal of the United States’ ambassador in Kyiv, Marie Yovanovitch.
On the same day that Parnas posted pictures of the meeting, Sessions wrote a private letter to Secretary of State Mike Pompeo calling for Yovanovitch’s dismissal.
Parnas said he and Fruman told Sessions that Yovanovitch was disloyal to the president and questioned whether she should serve. “She was bad-mouthing our president about getting impeached,” said Parnas.
Sessions, however, said he had been the one to bring up concerns about Yovanovitch with Parnas and Fruman, but that he could not remember when or where the discussion took place.
“I do know both these gentlemen,” Sessions said. “They are Republicans. They are people who have an interest in foreign affairs. They have a strong interest in America not backing away from Ukraine.”
The next month, Parnas and Fruman donated a total of $5,400 to Sessions’ unsuccessful 2018 re-election campaign, FEC records show.
Yovanovitch stepped down this May following a flurry of negative stories about her in the conservative media, which included the publication in The Hill of a leaked copy of Sessions’ letter. The press blitz also included frequent reference to Lutsenko’s inflammatory allegations against the ambassador.
Given Parnas and Fruman’s relationships with senior Ukrainian officials and their business interests in the country, their lobbying against a U.S. ambassador raises questions about their compliance with the Foreign Agents Registration Act (FARA).
The act requires Americans operating on behalf of a foreign entity in the United States to declare their work to the Department of Justice. Parnas and Fruman did not do so.
Their lobbying of Sessions raises “the thorniest red flag,” said Ron Oleynik, a Washington attorney who advises clients on FARA compliance. “That, to me, is clearly trying to influence an office of the United States toward Ukraine.”
Parnas, however, said they acted on their own accord.
“I just kept hearing [about Yovanovitch] from different people,” he said.
Introduction to an Oligarch
After setting up meetings between Giuliani and Ukrainian prosecutors, Parnas and Fruman set their sights on connecting with Ukraine’s new president, former television comic Zelensky.
As Zelensky stormed to a landslide victory in the April election, Parnas and Fruman flew to Israel to meet Ihor Kolomoisky, a Ukrainian oligarch who is alleged to have stolen $5.5 billion from the country’s largest private bank. Earlier that month, the Daily Beast reported that Kolomoisky, who is a key Zelensky backer, was under FBI investigation for financial crimes.
Fruman and Parnas were introduced to the oligarch by Alexander Levin, another pro-Trump Ukrainian-American businessman, on the pretence that they wanted to talk about their plan to sell gas to Ukraine, Kolomoisky said in an interview.
However, once inside the meeting, the two men told Kolomoisky that they wanted his help getting in touch with Zelensky, in order to help set up a meeting between Giuliani and the president-elect.
Offended, Kolomoisky said, he then stormed out of the meeting.
“I told them I am not going to be a middleman in anybody’s meetings with Zelensky,” Kolomoisky said. “Not for them, not for anybody else. They tried to say something like, ‘Hey, we are serious people here. Giuliani. Trump.’ They started throwing names at me.”
In response to inquiries, Levin said of Parnas and Fruman: “I met these gentlemen for the first time in March of 2019. I have no information about what they have done in the past, or what they have done since they met with me. I plan no involvement with them in the future.”
“I broke no laws and any suggestion otherwise constitutes slander.”
Despite the debacle in Israel, Parnas and Fruman continued their efforts to connect Giuliani with Zelensky. By mid-May, in the lead-up to Zelensky’s inauguration, both men were in Kyiv, staying in the city’s Hilton as they set up appointments around town.
The official reason for Giuliani’s visit was to give a paid speech for American Friends of Anatevka, a New York-based charity run by Fruman that supports the reconstruction of a Jewish village outside of Kyiv that was the setting of the musical “Fiddler on the Roof.” The meeting with Zelensky was intended to take place on the sidelines of the event.
Though Giuliani cancelled his trip, Parnas and Fruman managed to hold meetings with two figures close to Zelensky: Serhiy Shefir, who has since been appointed as an aide to the president, and Ivan Bakanov, now acting head of Ukraine’s secret police. The meetings failed to lead to a meeting between Giuliani and Zelensky.
The two men also held a meeting with Ukraine’s national gas monopoly, Naftogaz, in order to pitch their plan to sell liquified natural gas (LNG) to the country, company spokeswoman Aliona Osmolovska confirmed in response to reporters’ questions.
“Among other initiatives, we had meetings with a number of potential suppliers of LNG. In this context, we have been approached by Mr. Parnas and Mr. Furman [sic], and met them,” Osmolovska wrote.
While Parnas and Fruman were in Kyiv, Kolomoisky, who had just returned from years of exile abroad, gave an impromptu interview to a local media outlet where he denounced the men as “scammers” and said he would take them “into daylight soon.”
Giuliani responded quickly. In a series of tweets, he labeled Kolomoisky a “notorious oligarch.”
“This is real test for President [Zelensky],” Giuliani tweeted. “Will [Kolomoisky] be arrested?”
Parnas and Fruman responded by filing a criminal complaint with Ukrainian police, alleging that Kolomoisky had threatened their lives. They also lodged a defamation suit against the oligarch, their lawyer Alina Samarets said.
Giuliani personally joined at least one call to discuss the case, Samarets said.
Despite these setbacks, Parnas told reporters that his and Fruman’s work in Ukraine would continue.
“It’s all going to come out.”
