Editor’s Note: The following article is part of the Ukraine Oligarch Watch series of reports supported by Objective Investigative Reporting Program, a MYMEDIA project funded by the Danish government. All articles in this series will be available in English, Russian or Ukrainian can be republished freely with credit to their source. Content is independent of donor.
Of all the oligarchs in Ukraine, Vadim Novinsky may be the most politically expendable. Prosecutor General Yuriy Lutsenko announced on Nov. 3 that he would ask lawmakers to permit the criminal prosecution of Novinsky. The lawmaker belongs to the Opposition Bloc faction, which is made up predominantly of ex-President Viktor Yanukovych’s loyalists.
Story at a glance:
He was born in Russia. He became Ukraine’s “Russian” oligarch. He became a Ukrainian citizen only in 2012. He was on President Viktor Yanukovych’s side during the EuroMaidan Revolution.
He said that “all the followers of all the revolutions are the little devils.” His business partner from Russia has ties to Vladimir Putin. He owns no rubles, but critics suspect he is an agent of Russian influence. He is still in Ukraine, but for how long? He is no friend of Ukraine’s president, who called him an “Orthodox bitch.”
His citizenship is being challenged. He faces investigations. His days in Ukraine may be numbered.
Vadim Novinsky
Date of birth: June 3, 1963
Place of birth: Staraya Russa city of Novgorod Oblast in Russia.
Wealth: $546 million, 10th richest person in Ukraine, according to 2016 estimate by Novoye Vremya magazine.
Key Assets: Smart Holding investment company, which has about a quarter at Metinvest iron ore producer. The rest of Metinvest is owned by Rinat Akhmetov’s SCM. Novinsky’s Smart Holding also shares with SCM the HarvEast agricultural holding, based in Donetsk Oblast.
Personal: His wife Maria Novinska and four children are all the Russian citizens and live in St. Petersburg, Russia.
Praised for: Novinsky’s charity foundation named after the Holy Virgin Protection sponsors religious, medical and cultural projects including restoration of Baturyn historic city and Uspensky Cathedral of Kyiv Pechersk Lavra.
Criticized for: Allegedly participating in a plot to oust the late Metropolitan Volodymyr (Sabodan), the now deceased leader of the Ukrainian Orthodox Church of the Moscow Patriarchate in order to replace him with a more loyal church leader. Suspected of being an agent of the Russian world through sponsoring the pro-Russian Orthodox pilgrimage in July and Immortal Regiment rally in May. Obtaining the Ukrainian citizenship in a questionable way.
Of Ukraine’s rich and powerful oligarchs, Vadim Novinsky is the one who appears to have the most questions raised about his past and about his shaky future status in the country.
Vadim Novinsky (R) talks to Serhiy Lyovochkin, who served as chief of staff to former President Viktor Yanukovych, at the presentation of the opposition government. It is composed partly of former Yanukovych allies. (UNIAN)
The reasons
This Russian-born Ukrainian oligarch was a publicity-shy and little-known Russian citizen as he built up a massive business empire in Ukraine in the 1990s and 2000s – first serving as a partner for a top Russian oil company before snapping up domestic businesses in the strategically important steel, ore mining and shipbuilding sectors.
He forged a partnership with Ukraine’s richest billionaire, Rinat Akhmetov, taking a minority stake in Metinvest, which merged their steel and ore mining businesses.
He only became a Ukrainian citizen two years before Russia unleashed its war against Ukraine, first occupying Crimea and later engineering a hybrid war in the eastern Donbas region.
His Ukrainian citizenship was granted in 2012 by Ukraine’s pro-Russian then-President Viktor Yanukovych, who fled Ukraine for Russia on Feb. 22, 2014, after the EuroMaidan Revolution.
Vadim Novinsky (L) stands by then-President of Ukraine Viktor Yanukovych and Russian president Vladimir Putin during the ceremony of consecration of the St. Volodymyr bell tower in Sevastopol, Crimea, on July 28, 2013. (UNIAN)
But before these historic developments that shook the world, Novinsky swiftly tiptoed into positions that put him at the center of power and decision-making in Kyiv.
Just one year after becoming a Ukrainian citizen, Novinsky was elected a parliament lawmaker in a single-mandate contest representing the Crimean city of Sevastopol, where Russia’s Black Sea Fleet – the source of Russia’s “green men” forces used to occupy Crimea in 2014 – was based as part of an agreement with Ukraine.
He swiftly joined the leadership ranks in Yanukovych’s now-defunct, but then dominating, Party of Regions. He was seen at the president’s side during key backroom political maneuvering during the EuroMaidan Revolution that culminated in riot police killing at least 100 unarmed protesters in Kyiv.
This background alone, not to mention his continued strong role in backing the Russian Orthodox Church’s hold on Ukraine and his description of Russia’s war against Ukraine as “fratricidal,” is enough to make many claim that he is a Russian agent of influence planted in the country.
Novinsky denies this and other accusations.
Vadim Novinsky (R) laughs with fellow lawmaker David Zhvania in parliament on Oct. 24, 2013. At that time both were members of the Party of Regions faction which backed then-President Viktor Yanukovych. (UNIAN) (source)
Victim of ‘revenge’
In an interview with the Kyiv Post, the 53-year-old Novinsky claimed he’s determined to stay in Ukraine, calling his mounting problems in the country a mixture of “politics, racket and trivial revenge.”
Prosecutor General Yuriy Lutsenko, a presidential loyalist, announced on Nov. 3 that he would ask lawmakers to permit the criminal prosecution of Novinsky, asking to strip him of parliament immunity.
“I will commit hara-kiri, hang myself and drown myself out of fear,” Novinsky told the Kyiv Post sarcastically, commenting on Lutsenko’s announcement.
Some may be surprised to learn that oligarch Petro Poroshenko, Ukraine’s president, played a key role in securing Novinsky Ukrainian citizenship. In 2012, Poroshenko, serving as economy minister, sent a formal request to Yanukovych asking for Novinsky to be granted citizenship, citing contributions to Ukraine’s economy.
Yet it is Novinsky’s alleged bad personal relations with Poroshenko that provide one more reason to believe his days in Ukraine could be numbered.
The public got a rare chance to view the friction between them, thanks to a leaked Youtube video taken on Feb. 20, 2014, after the massacre of EuroMaidan protesters.
As grim-faced lawmakers pondered the events in parliament’s smoking room, Novinsky blamed Poroshenko for stirring up the protesters, claiming they provoked the bloodshed.
The words nearly triggered a brawl, prevented only by other lawmakers separating them as Poroshenko fired back at Novinsky calling him an “Orthodox bitch.”
“You are accusing me of this! This is un-Christian!” he yelled at Novinsky, who was side-by-side with Yanukovych during heated backroom negotiations during the revolution.
Nearly three years later, on Sept. 6, as lawmakers stood up in respect as Poroshenko as president finished his speech in parliament’s session hall, Novinsky crossed his fingers, bowed his head and remained seated.
Vadim Novinsky (R) hugs archbishop Pavel, the abbot of the Kyiv Pechersk Lavra Orthodox monastery, celebrating the arrival to the monastery of the relics of St. Panteleimon from the mount of Athos in Greece on Oct. 20, 2012. (UNIAN)
Hunkering down
Novinsky didn’t follow many of Yanukovych’s closest associates in fleeing to Russia.
He spends much of his time now in parliament, as a lawmaker within the Opposition Bloc.
The rebranded political formation is comprised largely of former Party of Regions lawmakers: Yanukovych backers linked to oligarchs Akhmetov and exiled Ukrainian industrial tycoon and former Russian Gazprom partner Dmytro Firtash.
In March 2015, a group of the lawmakers from People’s Front party of ex-Prime Minister Arseniy Yatsenyuk tried to strip Novinsky, whose wife and four children remain Russian citizens, from Ukrainian citizenship. This past April, Poroshenko ordered a State Migration
Service investigation into whether Novinsky received his citizenship legally.
In November 2015, Novinsky was questioned by prosecutors in the EuroMaidan killings, and the Security Service of Ukraine raided his offices over suspected financing of Russian-backed separatists this July.
One of the newest allegations he is facing relate to his alleged influence over the local Russian Orthodox Church. The General Prosecutor’s Office led by presidential loyalist Lutsenko claims the oligarch attempted under the presidency of Yanukovych to oust the late Metropolitan Volodymyr (Sabodan), the then-terminally ill leader of the Ukrainian Orthodox Church of Russian Patriarchy. It’s a claim Novinsky steadfastly denies.
If his guilt is proved, the oligarch faces up to five years in prison.
The Kyiv Post spoke to Novinsky on Sept. 2, a day after the oligarch gave testimony to prosecutors.
Russian Orthodox icons were seen almost in every room in his Kyiv offices, located in a cozy historic mansion in Podil area.
Apart from the icons, Novinsky’s office also had two portraits – of Metropolitan Onufriy, the new head of the Ukrainian Orthodox Church of Russian Patriarchy, and of late Viktor Chernomyrdin, former Russian prime minister, former ambassador to Ukraine and the oligarch’s big friend.
In another room, he said he has a gallery of portraits of Kirill, the leader of Russia’s Orthodox Church.
“I’m an Orthodox person, Orthodox businessman,” Novinsky said.
Born, bred in Russia
Although mystery and unanswered questions hang over the past of many oligarchs in Ukraine and Russia, Novinsky’s biography is particularly intriguing.
Born in the Russian city of Staraya Russa, with 31,000 residents 570 kilometers northwest of Moscow, he studied aviation engineering in Russian President Vladimir Putin’s hometown, the former Soviet city of Leningrad now renamed to St. Petersburg. He says he worked as an air traffic controller and engineer in the late 1980s.
Business for Novinsky took off during the chaotic crony capitalistic wild years following the collapse of the U.S.S.R. How he made this leap is not totally clear.
Novinsky refused to recall how and when he earned his first million.
“I even don’t remember it already,” he said.
Speaking generally about the 1990s, he added: “It was an interesting time… with lots of opportunities” requiring “savviness and bravery.”
By the mid-1990s he started working with Lukoil, one of Russia’s largest oil companies, launching with partners Lukoil Severo-Zapad company. It was a network of jobber gas stations later renamed into Severo-Zapad Oil.
Vadim Novinsky (L) hugs then-President Viktor Yushchenko on Nov. 25, 2011, in Kyiv. (UNIAN)
Fueling, then privatizing
It was in that 1990s period that Novinsky claims to have started business activity in Ukraine, first selling fuel to Crimea, later supplying it to Ukraine’s mining and metallurgical plants.
Barter was the mode of payment in those hyperinflation, credit and cash crunch days. Yet getting paid by what was then cash-strapped state factories for fuel supplied in metal and other commodities prized on global markets turned many traders with connections into millionaires and billionaires.
In 2003-2004, as a still not publicly known figure, Novinsky managed to win the privatization bid for the Ingulets Iron Ore Enrichment Works (Ingulets GOK), a Kryviy Rih-based major mining and processing plant and formerly part of Ukrrudprom state company. He purchased the enterprise in parts through dilution of the state share in the company. In 2004 he purchased the remaining 37.5 percent of the Ingulets GOK for some $32.5 million, according to Forbes.UA.
Speaking at a parliament committee in March 2015, oligarch Ihor Kolomoisky, who also benefited from privatization of Ukrrudprom, called that process an “illegal” rigging of privatizations done through backroom deals and bribing of then President Leonid Kuchma to sign a special law for privatization of strategic assets.
“Privatization of Ukrrudprom was initially planned in a way to limit the number of participants so that it ended up in particular hands,” Kolomoisky said.
Novinsky, speaking with the Kyiv Post, denies such claims.
“I believe it was fair,” said Novinsky while calling Kuchma “the best president Ukraine ever had.”
Volodymyr Fesenko, head of Penta political think tank, finds it surprising that Novinsky, a Russian national, managed to outmaneuver local oligarchs in domestic privatizations.
“It’s a big mystery why he stayed in Ukraine. Some Russian oligarchs also went to Ukraine, but while for example (Konstantin) Grigorishin has roots in Ukraine, Novinsky doesn’t,” Fesenko said.
Novinsky said Ukraine was warm and welcoming in the 1990s. “It was nothing like, ‘you moskal (a Ukrainian derogatory name for Russians), get out of here.’ It’s only now a rough nationalism takes over people’s minds,” he said.
Vadim Novinsky follows metropolitan Onufriy, head of the Ukrainian Orthodox Church of Moscow Patriarchy, during a mass Orthodox pilgrimage in Kyiv on July 27. (Volodymyr Petrov)
Russian friends
Novinsky’s business in Ukraine started to mushroom in a flurry of asset acquisitions, including ore mines, shipyards and food companies, around the time that Chernomyrdin, the ex-Russian prime minister who died in 2010, was appointed ambassador to Kyiv.
Novinsky calls Chernomyrdin, who was close friends with Ukrainian President Leonid Kuchma, his “teacher and friend.” He confirmed briefly having an iron ore deposit development business in Russia with Chernomyrdin’s son.
Novinsky also still shares ownership of his Smart Holding with St. Petersburg businessman Andrei Klyamko. Klyamko is linked to Russian President Vladimir Putin. Klyamko heads the sambo federation in St. Peterburg while Putin holds an honorary presidential role in nation’s sambo federation.
Novinsky said he met Putin just once in Crimea in July 2013, when Putin and Yanukovych jointly observed the parade of Russian and Ukrainian Black Sea fleets. He refused to speak about Putin, saying only he has “his own president to criticize.”
In Ukraine, Novinsky created an alliance with Akhmetov, merging Ingulets mining and his metal assets with Akhmetov’s steel industry assets as part of the Metinvest group, where Novinsky has a quater percent stake.
Supported by fellow lawmakers from the Party of Regions, Vadim Novinsky (C) is seen in this June 22, 2014 photograph fist fighting with legislators from the nationalist Svoboda party. (Ukrinform)
Two-president tango
After Kuchma’s presidency ended with the 2004 Orange Revolution, Novinsky managed to create good working relations with President Viktor Yushchenko.
The oligarch gave money to Yushchenko’s failed project on creation of a children’s hospital and other charities. Political insiders say that he also clandestinely gave money to Yushchenko’s Nasha Ukraina political party, which Novinsky denies.
Novinsky’s business and political influence prospered more under Yushchenko’s successor, Yanukovych.
Novinsky followed Yanukovych, also a devoted Orthodox Church believer, on pilgrimages to the sacred Mount Athos in Greece.
In 2012, two years after Yanukovych became the president, Novinsky was ranked by Focus magazine the second richest Ukrainian tycoon with $4.4 billion in assets, following only Akhmetov. That was the year that Yanukovych granted Novinsky Ukrainian citizenship.
Vadim Novinsky (R) shakes hands on May 8, 2015 with two former Ukrainian presidents, Leonid Kravchuk and Leonid Kuchma, during a special parliament session to commemorate the 70th anniversary of victory against Nazism in Europe. Another former President Viktor Yushchenko talks to then Prosecutor General Viktor Shokin. (UNIAN)
Entering politics
Novinsky surprised many when he decided to participate in parliament by-elections in Sevastopol in 2013 and won them with 53 percent support.
Despite running as an independent candidate, Novinsky led his campaign using spin doctors linked to Yanukovych’s administration. “Novinsky became a lawmaker by direct blessing of Yanukovych,” said Taras Berezovets, head of Berta Communications think tank. In exchange for this help, Yanukovych obliged Novinsky to buy and support the Sevastopol football club, Berezovets said.
Novinsky failed to explain why he decided to go in politics, saying only he spent just three months as a lawmaker in a former parliament before the EuroMaidan Revolution started in late November 2013.
He joined the faction of Yanukovych’s Party of Regions and voted in January 2014 for so-called “dictator bills,” which envisaged criminal responsibility for the protest movement.
Relatives of Soviet soldiers from World War II march brandishing the portraits of their veteran and fallen relatives on May 9, 2016, in Kyiv during the rally called the “Immortal Regiment.” The controversial rally, whose idea was borrowed from Russia, sparked big criticism in Ukraine. (Koslyantyn Chernichkin)
‘Revolutions…from devil’
Novinsky’s position on the EuroMaidan and other revolutions seems to echo that of Putin.
Novinsky says he was against the EuroMaidan Revolution and any revolution in general, calling them a devilish thing.
“The devil was the first revolutionary in history when he stood out against God,” he said. “All the followers of all the revolutions are the little devils.”
Many Yanukovych allies started distancing themselves from the disgraced president in December 2013 after the brutal beatings by riot police of student protesters. But Novinsky was with Yanukovych to the very end.
Novinsky claims he mediated talks between Yanukovych and the opposition during the EuroMaidan “in order to avoid bloodshed.” He said he met even with Dmytro Yarosh, then head of the radical nationalist Right Sector group.
Novinsky blames of the mass killings, which happened in the last days of the protests, not on Yanukovych but “some of those who wanted to gain power.” He did not name them.
In November 2015, prosecutors called Novinsky, who at that moment was a lawmaker of Opposition Bloc party, as witnesses in a criminal case on EuroMaidan killings.
No friend of Poroshenko
Downplaying his Feb. 20, 2014 “Orthodox bitch” clash of words with Poroshenko, Novinsky claims that 10 minutes later both shook hands and hugged each other. This moment wasn’t, however, caught on film, and Novinsky admits that bitter feelings remain since.
“We have known each other since 1997. We have never been friends but never had conflicts as well,” Novinsky said.
Novinsky was careful when speaking about Poroshenko, often criticizing his cronies, but not personally the president. Unlike most other oligarchs, who are often welcomed at the presidential office, Novinsky said he doesn’t meet with Poroshenko.
Fesenko, who knows both politicians well, said they have always disliked each other.
On April 26, Poroshenko ordered the State Migration Service to clarify on whether Novinsky acquired his Ukrainian citizenship without violations of law. He did this after a group of lawmakers initiated this issue and over 25,000 people signed the petition on presidential web-site, asking about this.
Novinsky says the State Migration Service checked his citizenship and found no violations. He added that he spent six months cancelling his Russian passport before receiving the Ukrainian one. “Before passing all these procedures I had to refuse from links with Russia and receive all proof,” he said.
The State Migration Service confirmed to the Kyiv Post it didn’t find any violations in Novinsky’s papers.
Secret port
In September 2013, the Center for Advanced Defense Studies, a Washington-based nonprofit group, issued a report about a secret Ukraine-based seaport called Oktyabrsk known since Soviet times as a main channel for arms shipments.
The report, called “The Odessa Network: Mapping Facilitators of Russian and Ukrainian Arms Transfers,” claimed that Russia preserved its control over the port located in the outskirts of Mykolayiv, and conducted arms trafficking via then port manager Andrei Yegorov – and claimed the port was de facto controlled by Novinsky.
“Port manager Andrei Yegorov was born in Sochi, served as a submarine commander in the Russian Navy Black Sea Fleet until 2000 and achieved the rank of captain, is a graduate of multiple elite Soviet/Russian military academies, and only received Ukrainian citizenship in 2000. Yegorov is reported to be a tool of the Russian-Ukrainian oligarch Vadim Novinsky, who is reputed to own Oktyabrsk,” the report said.
The report added that surprisingly the Oktyabrsk port was excluded from privatization.
While Yegorov was replaced as a port manager in 2013, the current executive director of Oktyabrsk port, Ruslan Oleinyk, used to work as a finance director at Novinsky-owned Chernomorsky Shipbuilding Yard, according to his official biography.
Novinsky confirmed that Oktyabrsk port was used for arms trafficking by both Ukraine and Russia, but denied any links with the secret port.
Meanwhile, Oktyabrsk port keeps on serving as a point of departure in the international arms trade.
In March 2015, the Mykolayiv-based Korabelov.Info website reported that seven T-80 tanks were shipped out of the port.
Crimean business
Novinsky claims he opposed Russia’s occupation of Crimea and said he visited the peninsula for the last time in April 2014 at the invitation of a local church leader.
He claims he “sold or gave out” his businesses in Crimea, which included the country’s only enterprise for producing railway arrows, and Balaklava Mine Group, a large manufacture of limestone.
But Berezovets, an expert who wrote a book about Russia’s unrecognized Crimea annexation, said Novinsky managed to keep his businesses on the peninsula and now he participates in a big construction project commissioned by Russia’s defense ministry.
“Novinsky’s companies conduct construction of military objects on the territory of annexed Crimea,” Berezovets said.
In August 2015, Glavkom news website published a story claiming that Novinsky sold his Balaklava Mine Group to his brother by father, Ashot Malkhasian. To prove this, the media found public information from Russian courts showing that Novinsky and Malkhasian are brothers.
This company is now involved in construction of the Kerch bridge, the big Kremlin project aimed at linking the annexed peninsula with Russia, Glavkom wrote.
Novinsky confirmed to the Kyiv Post that he sold the enterprise to Malkhasian but refused to comment whether he was his brother, saying only “I’m trying not to comment on issues related to my family.”
Donbas business
In July, the Security Service of Ukraine, or SBU, searched several Novinsky’s enterprises suspected in financing terrorist organizations. The oligarch claimed these suspicions are groundless and added the search was done to pressure him at a time when he was involved in a massive Russia-linked Orthodox Church pilgrimage.
Novinsky admitted owning along with Akhmetov steel mills in the separatist-controlled Khartsyzsk and Yenakiyeve towns, which manage to keep on working and paying salaries despite the war. These companies, he added, are now registered on government-controlled territory and pay taxes to Ukraine.
But he didn’t explain how they persuaded Russian-controlled separatist militants to give permits to work on territory under their control.
“We didn’t make any arrangements with them on this. They just understand that something needs to be done with (plant workers),” Novinsky said.
Russian agent?
Andriy Levus, a lawmaker in the pro-Western People’s Front party and a former deputy head of the SBU, said there are several reasons to suspect Novinsky is “assisting Russia in its aggression.”
Levus said that his sources tell him that law enforcement bodies are developing several cases involving the oligarch.
“There is information that he was the main sponsor of several suspicious events aimed at destabilizing the situation in the country,” Levus said. “It was the so-called Orthodox march and the Immortal Regiment rally organized on May 9.”
The march, borrowed from Russia, and called the Immortal Regiment, was organized to remember soldiers killed during World War II. It sparked controversy in Kyiv and led to minor clashes between participants and the police.
Novinsky denied organizing the rally. He, however, admitted that on May 9 he along with several other lawmakers of Opposition Bloc came to the Park of Eternal Glory in Kyiv — the same place where the Immortal Regiment rally was held — to “honor the heroes who gave their lives for the Great Victory,“ he said.
Levus also said he suspects Novinsky still bears a Russian passport, which would be grounds to cancel his Ukrainian citizenship. Nevertheless, other tycoons are suspected of the same violation.
Berezovets, the analyst, is more skeptical about Novinsky’s role.
“I doubt he’s an agent of the FSB (Russian security service), but I have no doubt that he is indirectly involved in Russian projects on Ukrainian territory.”
Novinsky called himself a “patriot of Ukraine.” He added that not wearing vyshyvanka (a traditional Ukrainian shirt) doesn’t make a person less patriotic.
Meanwhile, Lutsenko announced the new arrests of lawmakers following the arrest of Novinsky’s fellow party member Oleksandr Yefremov on Aug. 1.
With little success in bringing to responsibility corrupt officials of both former and current political regimes, a criminal persecution of an openly pro-Russian Novinsky could placate at least some nationalist-oriented critics of the government.
Novinsky said he had no information about his possible arrest and threatened to mobilize his political supporters for his defence.
In his opinion piece at the Guardian newspaper published on Sept. 23, the oligarch complained about “an increasingly bold witch hunt by the government against opposition voices.”
Novinsky called a criminal case against him fabricated and politically motivated.
“Those in power create the ‘soap operas‘, performances and political shows to distract people’s attention from their failures,“ he wrote on his Facebook page on Nov. 9. “This ‘soap opera’ will end with the complete fiasco even though the top state officials participate in it.“
The oligarch added that he was not going to leave the country.
If Novinsky is forced to flee Ukraine back to Russia, he may be in the market to buy Russian rubles on his way.
Interestingly, he doesn’t own any Russian rubles … nor a single Russian kopek.
That’s what he declared this autumn in filing his asset declaration as part of Ukraine’s revealing and landmark anti-corruption effort: the e-declarations filed by 50,000 public servants so far.
Novinsky along with relatives, declared to hold numerous properties in both Russia and Ukraine. In 2015 he held $2.34 million and 780,000 euros and 3 million hryvnia in cash.
He could borrow some from his wife or from one of his daughters. They hold 47,328 rubles and 7,290 euros in their bank accounts.
