'Ukraine network allowed billionaire to make gas killing'


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The Independent Online

A 29-year-old businessman accused of being a front man for the former Ukrainian president Viktor Yanukovych made $100m (£64m) buying Russian gas at a preferential rate from the controversial London-linked oligarch Dmitry Firtash and selling it on at higher prices, according to reports.

Reuters said that Serhiy Kurchenko, a self-declared billionaire, made the money selling cheap gas supplied by companies run by Mr Firtash, a prominent Ukrainian oligarch whose close links with London power brokers have been extensively documented by The Independent.

Mr Firtash, who was arrested in March on a business trip to Austria under an FBI extradition warrant, has longstanding business connections to Russia. His companies were able to buy gas cheaply from Gazprom, the giant energy company run by allies of President Putin.

Some Ukrainian politicians and gas industry experts said they believe the deal was a way for Mr Firtash to reward Mr Yanukovych for political favours that had benefited Mr Firtash’s business empire. Profits from the arrangement were destined for Mr Yanukovych, they allege.

The Independent has previously detailed how Mr Firtash funded cultural events in London painting the Yanukovych regime in a positive light, and through his charity funded British MPs to visit Ukraine.

“Everybody in Ukraine knows that he [Kurchenko] is the wallet to pay off Yanukovych,” said Viktor Chumak, a senior politician and former head of the parliament’s anti-corruption committee. Reuters was unable to confirm the purpose of the deals or whether Mr Kurchenko passed proceeds to Mr Yanukovych.

The gas deals are likely to add to the controversy surrounding Mr Kurchenko. Ukrainian officials have been investigating both him and Mr Yanukovych since earlier this year, though those inquiries have focused on deals involving petroleum products and banking, not the natural gas deals uncovered by Reuters. Both men fled Ukraine after Mr Yanukovych’s overthrow in February.

Mr Kurchenko is accused by the current Ukrainian Government of systematically evading millions of dollars in tax with the collusion of officials in Mr Yanukovych’s administration. Vitaly Yarema, general prosecutor of Ukraine, said Mr Kurchenko was under investigation for allegedly failing to pay the state $130m in tax and allegedly stealing $180m from bank investors.

Ukrainian officials say Mr Kurchenko was closely linked to Mr Yanukovych, who was toppled over his attempts to align Ukraine with Russia rather than the European Union. The former president is himself accused by the Ukrainian Government of stealing millions of dollars from the state.