Court decides to arrest some accounts in Cypriot branch of PrivatBank in embezzlement investigation

Kyiv's Pechersky district court on July 29 approved four rulings that arrest some accounts in the Cypriot branch of the largest bank in Ukraine – PrivatBank (Dnipro) – as part of an investigation into embezzlement of UAH 19 billion of refinancing funds issued by the National Bank of Ukraine (NBU).

According to the rulings posted on the website of the public ruling register, the chief investigation department of the Prosecutor General's Office of Ukraine is conducting a pretrial investigation in criminal case No. 42014000000001261 (recorded on November 13, 2014) into the embezzlement of NBU's funds by managers of PrivatBank.

"During the pretrial investigation it was established that managers of PrivatBank… abusing their powers in 2014 embezzled UAH 19 billion issued by the NBU to refinance PrivatBank," the rulings said.

According to the documents, managers of PrivatBank issued credits which cost was in the range from $18 million to $73 million to affiliated companies using ownership rights to commodities as collateral. Then the company signed deals (settling 100% of advance payment) to receive the commodities and sent the funds to accounts of nonresidents: Teamtrend Limited, Trade Point Agro Limited, Collyer Limited, Rossyan Investing Corp, ZAO Ukrtransitservice Ltd and Milbert Ventures Inc.

According to the rulings, the commodities have not yet been delivered and the funds have not been returned.

According to the documents, the account opened for Trade Point Agro Limited, Milbert Ventures Inc., Rossyan Investing Corp, ZAO Ukrtransitservice Ltd (all based in Britain) has been arrested.

As reported, last summer PrivatBank said that the bank is cooperating with investigators as part of the criminal case on the embezzlement of NBU refinancing worth over UAH 19 billion.

PrivatBank was founded in 1992. It ranked first among 109 operating banks as of April 1, 2016, in terms of total assets estimated at UAH 276.55 billion, according to the National Bank of Ukraine.

As of January 1, 2016, its largest shareholders were Hennadiy Boholiubov with 33.2525% of shares owned directly and 8.3346% indirectly and Ihor Kolomoisky with 41.6572% owned directly and 8.3346% owned indirectly.