Dmytro Firtash

Dmytro Firtash
Дмитро́ Фі́рташ
Born Dmytro Vasylovych Firtash
(1965-05-02) 2 May 1965
Bohdanivka, Zalishchyky Raion, Ukraine
Occupation Businessman
Website dmitryfirtash.com

Dmytro Vasylovych Firtash (Ukrainian: Дмитро́ Васи́льович Фі́рташ; born 2 May 1965) is a Ukrainian businessman, investor and philanthropist who heads the board of directors of Group DF.[1] He was highly influential during the Yuschenko administration.

Firtash was arrested by Austrian authorities in March 2014. In February 2017, the Vienna Court of Appeals ordered that Firtash be extradited to the United States, to face charges that he had secured a titanium extraction permit in India through $18.5 million in bribes.

As of August 2016, Firtash has not returned to Ukraine following the Maidan revolution of 2014. The current status of many of his various offices and titles within Ukraine are not clear; specifically those not directly related to his own business holdings. To date, he has retained ownership of his assets within Ukraine, including those areas presently under Russian control.

His many roles during the Yuschenko administration included: presidency[2] of the Federation of Employers of Ukraine (FEU); chairmanship[3] of the National Tripartite Social and Economic Council (NTSEC); co-chairmanship[4] of Domestic and Foreign Investors Advisory Council under the Ministry of Education, Science, Youth and Sports of Ukraine; and membership[5] in the Committee for Economic Reforms under the President of Ukraine.

Early life

Firtash[6] was born on 2 May 1965 in Bohdanivka, Zalishchiky Raion (Ternopil oblast), Ukraine, Soviet Union. Since 1990s, the villages is called Synkiv.

Business career and assets

Firtash started in business almost immediately after completing his military service. He founded his own trading company first in Chernivtsi, Ukraine, eventually moving to Moscow in the early 1990s.

In 2007, a private international group of companies, Group DF ("the Firtash group of companies") was formed to consolidate Firtash's business assets in different sectors. Presently, Group DF incorporates assets in the chemical industry, energy sector and real estate, and this consolidation effort is still underway.

In 2008, Firtash was involved with a firm owned by Paul Manafort in a $895 million project to redevelop the Drake Hotel in New York City into a spa and luxury mall to be called Bulgari Tower. According to court records, Firtash's firm had planned to invest $100 million in the project.[7] The deal was never finalized.[8]

In 2010, Firtash launched an effort towards consolidation of the Ukrainian nitrogen business. From September 2010 to September 2011, Firtash acquired ownership in 'Concern STIROL' (Horlivka), 'Severodonetsk Production Association Azot' and 'Cherkassy Azot'.[9] In just over a year, the joint marketing strategy of the four fertilizers manufacturers owned by Firtash substantially strengthened its domestic market position. The businessman is also actively pursuing an agenda of titanium industries development.[10]

Firtash is co-owner of RosUkrEnergo and controls much of Ukraine's titanium business. He gained control of previously state-owned titanium assets across Ukraine in 2004. He also owns several chemical plants.[11] In May 2011, Firtash took over Nadra Bank (at the time Ukraine's 11th largest bank). Nadra Bank had gone into default in 2009 but it has since restructured its foreign debt with significant write-offs.[12]

Firtash has become one of the leading investors in the power sector and chemical industry in Central and Eastern Europe.[13] His plants and companies are present in Ukraine, Germany, Italy, Cyprus, Tajikistan, Switzerland, Hungary, Austria and Estonia.

Firtash was elected President of the Joint Representative Body, a joint representative agency of employers at the national level, on 29 November 2011.[14]

Firtash bought 100 percent of InterInter Media Group Limited (back) from Valeriy Khoroshkovskyi on 1 February 2013, for his GDF Media Limited.[15] In June 2007 Khoroshkovskyi had expanded his U.A. Inter Media Group Ltd with various other channels bought from Firtash.[16]

In April 2014 Firtash stated that despite the difficult conditions of doing business in Ukraine, as well as the political crisis, OSTCHEM enterprises, part of Dmitry Firtash's Group DF, continued to ramp up production.[17][18][19][20] The investments directed to the development and modernization of OSTCHEM enterprises allowed significant increases in the production capacities of Rivne Azot, Stirol Concern, and Crimea soda plant in Q1 2014.[21] From the beginning of the political crises in Ukraine, Firtash had a clear-cut position concerning Euromaydan.[22][23] On 30 January 2014 he called for a peaceful and civilized conflict resolution.[24]

In February 2014 the British Ministry of Defence sold the Brompton Road tube station to Firtash, who planned to convert the site into residential flats.[25] The property remained unused as of August 2017 because (according to his lawyer) Firtash "could not travel from Vienna to London due to a U.S. extradition request".[26]

Business development initiatives

Firtash has pursued an active public agenda. His important initiative has been the unification of employers' organizations of Ukraine into a single powerful association, the Federation of Employers of Ukraine. He has been President since November 2011. The FEU membership includes companies and enterprises collectively generating 70 percent of Ukraine's GDP. It represents employers' interests in the economic, social and labor relations with the government and trade unions at the national level.[27]

In 2012 Firtash initiated the establishment of a venture investment fund, Bukovyna, aimed at supporting small enterprise. It has become Ukraine's first investment fund offering preferential lending support to small businesses and the only fund financing the development of promising ideas in all sectors of the economy.[28]

In October 2013, Firtash was introduced into the state commission of cooperation with the World Trade Organization by the President of Ukraine Viktor Yanukovych.[29]

Social activities

Firtash is one of Ukraine's leading philanthropists,[30] providing systemic support to education,[31] science,[32] theaters, and[33] museums,[34] as well as historical, cultural and humanitarian projects.[35] Firtash's enterprises have promoted the social and economic development of municipalities where they are based.

In 2008, on Firtash's initiative and with his financial support, the University of Cambridge (UK) established a Cambridge Ukrainian Studies program[36] aimed at promoting the study of Ukraine's rich cultural heritage in the United Kingdom and beyond. Another charity initiative by Firtash enabled the establishment of Cambridge-Ukraine Studentships,[37] that make it possible for eligible students from Ukraine to seek a Master's degree at the University of Cambridge. The scholarships cover the cost of both tuition and accommodation for qualified students.

Firtash has supported a series of other massive educational projects. He financed the construction of the Ukrainian Catholic University campus in the city of Lviv.[38]

Firtash united Ukrainian employers bringing business to a real dialogue with the authorities

The Holy Trinity Cathedral at the Holy Ascension Monastery in the village of Bancheny of Chernivtsi region were constructed with funds raised by the Orthodox community and a sizable contribution from Firtash. Firtash's support was recognized by the Orthodox church: His Holiness Patriarch Kirill of Moscow and All Russia awarded the philanthropist with the Order of Venerable Serafim Sarowsky, 2nd Degree.[39]

In 2011 Firtash was elected as a President of the Federation of Employers of Ukraine, a Ukrainian employers' organization representing their interests in the economic, social and labor relations with the government and trade unions at the national level.

In 2012 Firtash initiated the establishment of a venture investment fund aimed at supporting small enterprise by creating preconditions for realization of business ideas featuring a lucrative commercial potential. Bukovyna has become Ukraine's first investment fund offering preferential lending support to small businesses. It is the only fund financing the development of promising ideas 'from scratch' in all sectors of the economy.[28]

In October 2013, Firtash was introduced into the state commission of cooperation with the World Trade Organization by the President of Ukraine Viktor Yanukovych.[29] This is stated in the №540 decree of the President of Ukraine.

Politics

In spring 2002, Firtash ran unsuccessfully for Parliament as a member of the all-Ukrainian political association "Women for the Future", which was under the patronage of Lyudmila Kuchma, a wife of the President of Ukraine Leonid Kuchma. The party won 2.11% of the vote[40] just behind Nataliya Vitrenko's party and failed to pass the 3% threshold that was required to be represented in the Ukrainian parliament. In 2010, Firtash was involved in financing Viktor Yanukovych's presidential campaign.[41] Firtash says he sincerely believed that Yanukovych would learn from the events of 2003–2004 and adopt different policies. Since 2011 they have been at odds on questions of public policy. In 2011, Firtash said that Yushchenko had planned good reforms, but Prime Minister Yulia Tymoshenko had not allowed him to implement them.[42]

Firtash expressed his attitude to the 2013–2014 political crisis in Ukraine and reacted to Euromaidan more than two months from the beginning of the revolution.[43] On 30 January 2014 he called for resolving conflict in a peaceful, civilized way.

On 19 February 2014 Firtash openly addressed[44] to the President of Ukraine, the Cabinet of Ministers of Ukraine, leaders of the parliamentary majority and the parliamentary opposition calling on the Ukrainian political forces to stop the violent confrontation in the country and immediately begin to address the crisis in the parliament.

In March 2014, Firtash addressed on behalf of the business circles of Ukraine to Aleksandr Shokhin, the Head of the Russian Union of Industrialists and Entrepreneurs, and the entire business community concerning situation in the political arena and urged Russian businessmen to stop the war between Russia and Ukraine.[45]

On 3 April 2014 Firtash announced that he hoped the forthcoming presidential elections would overcome chaos in Ukraine and strengthen the country on the international political scene. He said: I will not allow for my reputation to be ruined by those who are driven by political motivations and are not interested in Ukraine and its people". On 11 April 2014, he urged big Ukrainian business to act according to the logic of "economic patriotism" and buy up goods in domestic companies.

On 30 April 2014, Firtash told the BBC that the unstable situation in the East of Ukraine was coordinated by Tymoshenko, that she needed disorder to allow her to declare a state of emergency and disrupt the presidential elections in Ukraine because she had no chance of winning. He said that Tymoshenko had already practically usurped power thanks to size of her parliamentary majority, with her party allies Oleksandr Turchynov and Arseniy Yatsenyuk headed the government.

In May 2014, Firtash stated that Ukraine must be strong, neutral and independent. He also pointed out that the top priority faced by Ukraine is to legitimize the government, which can only become a possibility after having the elections.

In September 2016, after serving as President of the Federation of Employers of Ukraine for five years, Firtash resigned the position of the FEU President.[46]

He als said that being a Ukrainian citizen he was waiting for the presidential elections and hoped to build stable and prosperous state together with fellow citizens. "I will not allow my reputation being spoiled by the enemies with political motivations that have nothing in common with interests of Ukraine and its citizens", said Firtash.[47]

While in Austria fighting extradition to the U.S., Firtash gave an interview to his own Inter TV channel in which he called for Ukrainian business to unite in support of the state to help it to overcome the economic crises.[48] He also promised to provide funds to supporting the Ukrainian army.[49] In April, OSTCHEM enterprises, part of Firtash's group of companies, started supporting Ukraine's military forces.[50]

Charity

Firtash is a member of the Guild of Cambridge Benefactors, set up in 1998 to recognize the generosity of major benefactors over £1 million to the University and Cambridge Colleges.[51] At a Guild of Cambridge Benefactors' event held on 19 March 2014 to honor the University's most prestigious donors, his wife Lada Firtash was in attendance. A group which calls itself Positive Investment Cambridge (PIC) handed out leaflets and daffodils to donors attending the event that called for the University to "spring clean" its donations.[52]

Firtash has been active in initiating and developing programs aimed at promoting Ukraine at the international arena.

In 2008, on Firtash's initiative and with his financial support, the University of Cambridge (UK)[53] established a Cambridge Ukrainian Studies aimed at promoting the study of Ukraine's rich cultural heritage in the United Kingdom and beyond.

As part of this program, Cambridge's students from across the globe attend an academic course of Ukrainian Studies that includes the Ukrainian language, literature, cinematography, culture and history.[54] Prominent international researchers of Ukraine are invited to lecture and host workshops on topical issues pertinent to both Ukraine's history and preset. The University of Cambridge also holds literary readings, art exhibitions and the Annual Cambridge Ukrainian Film Festival.[55] Over the history of its existence, the Cambridge Ukrainian Studies Program has truly become Ukraine's informal humanitarian mission in the United Kingdom.

Another charity initiative by Firtash enabled the establishment of the Cambridge-Ukraine Studentships that made it possible for eligible students from Ukraine to seek a Master's degree at the University of Cambridge. The scholarships cover the cost of both tuition and accommodation for qualified students.

Firtash has been supporting a series of other massive educational projects. An example of such philanthropic support is his financing of construction of the Ukrainian Catholic University campus in the city of Lviv.

The entrepreneur is actively involved in projects aiming at the international promotion of Ukrainian culture. His donation made it possible to organize and hold the second International Poetry Festival Meridian Czernowitz.[56]

A series of benchmarking events in Ukraine's cultural life – films screening and festivities on occasion of the 70th anniversary of the Ukrainian actor Bohdan Stupka – became a well-known success largely due to Firtash's benefaction.[57]

Among other Firtash's charity work is assistance to Ukrainian professional theaters. The celebration of the 75th anniversary of Kherson Regional Musical and Drama Theater largely owes its success to the philanthropist's endowment. In addition to that, his sponsorship support enabled a major restoration of material and technical resources of Chernivtsi Regional Musical and Drama Theater which became a generous gift on occasion of the theater's 80th anniversary.

In 2012 The University of Cambridge is delighted to announce that Dmitry Firtash has been nominated to receive the Chancellor's 800th Anniversary Campaign Medal for Outstanding Philanthropy, which will be presented at an exclusive ceremony in Cambridge in October 2012 by the Vice-Chancellor Professor Sir Leszek Borysiewicz.

Controversy

Firtash is a controversial figure in Ukraine.[58] According to documents uncovered during the United States diplomatic cables leak in 2010, Firtash told U.S. Ambassador to Ukraine William Taylor of needing permission from alleged Russian crime boss Semyon Mogilevich to do business in Ukraine during the lawless 1990s.[59] The same documents suggest that Firtash also claimed to be friends with President Viktor Yushchenko.[60] Firtash denied the remarks.[59] Allegedly, Gazprom, a Russian natural-gas extraction company, had asked Mogilevich to oversee natural-gas deliveries from Russia to Ukraine via gas intermediary RosUkrEnergo. All parties deny connections with Mogilevich.[59] Other cables said Firtash and Mogilevich were linked through ostensible offshore company vehicles either by joint ownership through former spouses or through Firtash headed companies in which Mogilevich's former spouse was the shareholder.[61] It was also suspected that Raiffeisen Bank, an Austrian-based bank, was a front to legitimize RosUkrEnergo.[61]

On 16 June 2009, Yulia Tymoshenko accused the other candidates in the 2010 Ukrainian presidential electionViktor Yushchenko, Arseniy Yatseniuk and Viktor Yanukovych–of sharing a single campaign headquarters financed by Firtash.[62][63] On 26 April 2011 Tymoshenko sued Firtash and RosUkrEnergo in a U.S. District Court in Manhattan accusing them of manipulating an arbitration court ruling in Stockholm that ordered Ukraine's state energy company Naftogaz to pay RosUkrEnergo 11 billion cubic meters of natural gas to compensate for fuel it had "expropriated" plus 1.1 billion billion cubic meters of gas as a penalty.[64]

Firtash and influential multi-time Minister Yuriy Boiko are alleged to be "close associates".[65][66][67]

Certain analysts and Ukrainian politicians believe that Firtash is a secret force behind the sentencing of Yulia Tymoshenko in 2011, either for revenge or to hinder Ukraine's European Union integration for personal financial gain.[68] Firtash was accused in a New York court of "masterminding" Tymoshenko's imprisonment; the case was dismissed in March 2013.[69]

In the 2012 Ukrainian parliamentary election Firtash was perceived as being one of UDAR's main sponsors.[70] This has been denied by UDAR.[71]

On 23 July 2013 brothers Ilya and Vadim Segal, the New York-based owners of Dancroft Holdings, brought charges in New York County Supreme Court against Firtash and Nadra Bank, Ukraine's eighth-largest bank.[72] The suit accuses Firtash, the bank's owner, of seizing their assets via "sham lawsuits" over debt, and of using his connections with President Viktor Yanukovich to guarantee the outcomes in court cases.[69] The suit stated that the former head of the Security Service of Ukraine (SBU), Valeriy Khoroshkovskyi, is a business partner of Firtash, together with head of the presidential administration Serhiy Lyovochkin, and former Ukrainian energy minister, Deputy Prime Minister Yuriy Boiko. According to the complaint, the SBU, in bringing charges against the Segals, was acting on behalf of Firtash.[73]

On 19 February 2014 Firtash called on Ukrainian politicians and government officials to cease their power struggles and start resolving political crises in Parliament.[74][75][76]

In March 2014 Firtash on behalf of the business circles of Ukraine appealed to the head of the Russian Union of Industrials and Entrepreneurs Aleksandr Shokhin and the Russian business community to stop the war between Russia and Ukraine.[77]

U.S. extradition request

On 13 March 2014, Austrian authorities arrested Firtash when U.S. law enforcement authorities sought to have Firtash extradited after a judge in Virginia issue a warrant for his arrest on bribery and other charges.[78] A week later Firtash was released on bail of €125m (£105m, $172m), the largest in Austrian legal history. He said: "thankfully, I have the utmost confidence in the Austrian judicial system and will use all legal means to prove my innocence".[79] He said U.S. authorities were making allegations that were "completely absurd and unfounded"[79] In April, a U.S. grand jury in Chicago indicted Firash and five others under the Foreign Corrupt Practices Act on charges that included bribery, racketeering, and money laundering. The charges centered on a $18.5 million bribe offered to government officials in India related to titanium mining licenses, with the minerals destined for sale to Chicago-based Boeing.[80][lower-alpha 1]

Denial of extradition to the USA

30 April 2015, during the thirteen hours of the court session, the Vienna Regional Criminal Court rejected the US request for the extradition of Ukrainian businessman Dmitry Firtash. Announcing the decision of the court, the judge Christoph Bauer named one of the reasons for denial of "at least partially politically motivated accusations" made by US justice.[82] He said: "America obviously saw Firtash as somebody who was threatening their economic interests", but "There just wasn't sufficient proof". He added: "For me it is obvious: Firtash is a very influential person in politics, titanium and gas businesses. The gas is also a politics". He said that in the year since his arrest in Vienna the American authorities had not provided sufficient evidence to Austrian court that Firtash paid bribes in India, and in particular had not provided witness statements in support of its assertions.[83]

During the proceedings Bauer had said that he did not doubt the veracity of the Americans' witnesses so much as whether they existed at all. A New York Times reporter described the decision as a "scathing rebuke of the Justice and State Departments", reflecting the diminished credibility of the United States authorities in the eyes of a European ally.[84]

Return to Ukraine

25 November 2015 German media reported that Firtash can come back to Ukraine and would participate in the Congress of the Federation of Employers of Ukraine on 2 December.

26 November 2015 a spokesman for the Interior Ministry of Ukraine Artem Shevchenko said that the Interior Ministry had no criminal proceedings in which businessman Dmitry Firtash held as a suspect, but there was a proceeding for the Ostchem group of companies in which he was summoned for questioning as a witness.

28 November 2015 the day when Firtash announced his arrival in Ukraine, the Head of the State Ukrainian airspace administration orally instructed to close air area for private aircraft to prevent businessman returning home.

1 December 2015 Firtash said that the Ukrainian government made unprecedented steps and did everything to disrupt his visit to Ukraine, that's why the businessman decided to postpone his visit to Ukraine.

The ruling of the Court of Appeal on extradition to the USA

On 21 February 2017, The High Regional Court of Vienna (Oberlandesgericht Wien) reviewed the appeal and ruled that it was allowed to extradite Mr. Firtash to the United States. The final decision on extradition of Firtash to the United States should be adopted by the Federal Minister of Justice of Austria.[82]

Judge Leo Levnaic-Iwanski noted that U.S. authorities had provided additional documentation since the lower court had ruled against them. Firtash faces up to 50 years in prison and the seizure of all his assets. Immediately following the verdict, Firtash was arrested on a Spanish arrest warrant related to charges of money laundering.[85][86]

Detention in the Court building in accordance with Spanish and American orders

On 21 February 2017, a few minutes after the announcement of the decision of the Higher Regional Court of Vienna Austrian police detained Ukrainian businessman at the courthouse in Vienna on the prosecutors' orders. The press-secretary of the Austrian Prosecutor Nina Bussek said that detention had been carried out on the basis of a European arrest warrant issued by Spain as the EU member. This means that the immediate reason for the Firtash arrest wasn't the request for his extradition from the United States. The Spanish warrant was issued as part of the investigation into money laundering. The prosecutor's office in Vienna detained Firtash for 48 hours following the request from Spain for his extradition, after which the court had to determine the preventive measure.

On 23 February 2017, the businessman was released from custody for the 125 million euros bail deposited in 2014 but now for another extradition proceeding to Spain. Firtash has to report to the court in regular intervals, is not allowed to leave Austrian territory and has to give his passport to the court. But on the same day – 23 February – the prosecutor's office arrested Firtash again continuing to hold him in custody in connection with the US extradition request.

On 24 February 2017, Vienna Regional Court dismissed the Vienna prosecutor's application to impose provisional detention pending surrender regarding the US-extradition case. The question where Firtash has to be extradited – to Spain or the United States – is in the jurisdiction of the Minister of Justice of Austria Wolfgang Brandstetter. In accordance with § 34 of the Agreement on Extradition between Austria and the US, in the absence of objections from the court, the last word is for the Minister of Justice. "The minister shall take into account the interests and international obligations of the Republic of Austria".

See also

Notes

  1. The indictments were issued in June 2013 but sealed until April 2014.[81]

References

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Additional sources
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