Ukraine has imposed punitive sanctions on Dmytro Firtash, a powerful tycoon indicted by the United States on corruption charges, as President Volodymyr Zelenskiy steps up his crackdown on influential elites ahead of his first official visit to Washington next month.
The Secretary of the National Security and Defense Council, Oleksiy Danylov, on June 18 announced the sanctions against Firtash, who currently lives in Vienna while fighting against extradition to the United States.
In announcing the sanctions, Danylov accused Firtash of selling titanium to the Russian defense industry. Kiev is engaged in a war against Russian-backed separatists in eastern Ukraine that has claimed more than 13,000 lives since 2014.
Ukraine’s security chief also announced sanctions against businessman Pavel Fuchs for his acquisition of more than a dozen natural gas fields from a former official linked to the government of former President Viktor Yanukovych , who was ousted during the Ukrainian revolution of 2014.
Firtash and Fuchs have been linked with former President Donald Trump’s personal lawyer Rudy Giuliani who sought to smear President Joe Biden’s son Hunter in Ukraine.
Zelenskiy will meet Biden for the first time in Washington in July.
Danylov did not give details of the sanctions, although they historically freeze an individual’s assets in Ukraine, including bank accounts.
Firtash controls key companies in the chemical, titanium and natural gas industries in Ukraine. Forbes ranked him this year as the 25th richest person in the country, with a net worth of $ 420 million.
The United States indicted Firtash, who is said to have close ties to the Kremlin, in March 2014, shortly after Russia annexed Ukraine’s Crimean peninsula.
US prosecutors accuse Ukrainian businessmen of paying bribes to Indian officials for titanium mining licenses, which they planned to sell to US aerospace giant Boeing.
Firtash denies the accusations and calls them politically motivated. He is currently seeking a new trial after the Austrian Supreme Court upheld his extradition in 2019.
Although he has lived in Austria since 2014, Firtash has continued to prosper financially in Ukraine. It is believed to control around 75 percent of the country’s gas supply companies.
Yuriy Vitrenko, CEO of state-owned natural gas company Naftogaz, told RFE / RL earlier this month that he suspected Firtash of shifting profits from the Ukrainian natural gas industry to affiliates in Western Europe by through a program known as transfer pricing. .
He also expressed concern that Firtash was selling natural gas that he had bought at below-market prices from Naftogaz to industrial users in violation of an agreement.
“Hold them for account”
George Kent, the US Assistant Secretary of State who oversees Ukraine, called on Kiev in April to attack Firtash as part of its anti-corruption agenda.
Kent pointed to Firtash’s role as an importer in the 1990s and 2000s of natural gas from Russia, a company that many officials and analysts said was rife with corruption.
“Why is it the United States indicting and prosecuting corrupt Ukrainians? Kent said, referring to the US indictment against Firtash.
“It is time for Ukrainian leaders and the judiciary – rather than not taking decisions against corrupt oligarchs – to use Ukrainian institutions to prosecute corrupt Ukrainians and hold them to account,” he said. .
The Biden administration has made progress from Kiev on reforms, including fighting corruption, a higher priority in the two countries’ relations.
US officials and analysts have expressed concern over a setback in Ukraine’s reform agenda over the past year, including the dismantling of anti-corruption legislation.
Biden stressed the need for Ukraine to move forward with difficult economic and political changes as well as fight corruption during a phone call with Zelenskiy on June 7. During the call, Biden invited the Ukrainian leader to visit the White House this summer.
When asked a day later by Senator Chris Murphy (Democrat-Connecticut) at a Foreign Relations Committee hearing whether there were any reforms the Biden administration wanted to see Ukraine put into effect work before Zelenskiy’s visit to the White House, Secretary of State Antony Blinken cited several, including a desire to see “people engaged in corrupt practices brought to justice.”
In an editorial posted on the website of the Atlantic Council, a Washington-based think tank, Zelenskiy said his administration would take action to limit the power of tycoons like Firtash who wield great influence over Ukraine behind the scenes. .
Ukrainian and Western experts accuse the tycoons of blocking crucial economic and political reforms that could put the country on the path to greater prosperity and European integration. They demanded that they be investigated by an independent judiciary, fearing that Zelenskiy’s use of sanctions would become a substitute for appropriate legal institutions.
Zelenskiy’s administration in February sanctioned Viktor Medvedchuk, a powerful tycoon and politician close to Russian President Vladimir Putin, for allegedly aiding separatists in eastern Ukraine.