Ukraine’s Arrest of Powerful Oligarch Is Latest Sign of Anti-Corruption Efforts

The arrest over the weekend of Ihor Kolomoisky, considered one of Ukraine’s richest males, has been seen as an indication of Ukrainian authorities’ drive to root out corruption and curb the affect of oligarchs.

A courtroom in Kyiv on Saturday ordered Mr. Kolomoisky held in pretrial detention for 2 months whereas authorities examine fraud and cash laundering fees in opposition to him. Mr. Kolomoisky’s bail was set at almost $14 million, which his attorneys mentioned he wouldn’t pay, including that they’d attraction the ruling, in response to Ukrainian news media.

Mr. Kolomoisky’s arrest got here a day earlier than President Volodymyr Zelensky mentioned he was changing his protection minister, Oleksii Reznikov, because the Defense Ministry faces investigations into the mishandling of army contracts. Mr. Reznikov has not been personally implicated within the inquiries.

Ukraine has been stepping up its efforts to fight corruption because it tries to assuage considerations amongst Western allies that wartime assist might be siphoned off for private acquire. The anti-graft efforts are additionally a part of Ukraine’s case for nearer integration with — and in the end membership in — the European Union.

With a fortune of $1.67 billion, Mr. Kolomoisky was ranked Ukraine’s fifth-richest particular person in a latest report by the Kyiv-based Center for Economic Strategy. His enterprise pursuits have included oil and banking, and he was as soon as thought of a patron of Mr. Zelensky, a former comic whose well-liked exhibits had been broadcast on Mr. Kolomoisky’s tv channel earlier than he efficiently ran for the presidency.

Suspicions of corruption and embezzlement have dogged Mr. Kolomoisky for years. In 2017, he left Ukraine for Switzerland and Israel after the federal government of then-President Petro O. Poroshenko seized a financial institution he co-owned and accused him of a large-scale fraud that threatened to destabilize Ukraine’s financial system.

He returned in 2019 after Mr. Zelensky’s defeat of Mr. Poroshenko, elevating fears that his ties to the brand new president would assist him regain his financial and political clout.

But efforts by the federal government — together with Mr. Zelensky, who campaigned on combating corruption and the oligarchs’ malign affect — have impeded Mr. Kolomoisky’s capability to claim himself. In 2020, Ukraine’s Parliament handed an anti-corruption invoice that prohibits the state from returning nationalized banks to their former homeowners, which appeared to take direct intention at Mr. Kolomoisky.

A yr later, the United States positioned sanctions on Mr. Kolomoisky, saying he had used a place as a regional governor for his private profit and engaged in “ongoing efforts to undermine Ukraine’s democratic processes and institutions.”

Russia’s full-scale invasion final yr additional affected Mr. Kolomoisky’s pursuits. Shortly after the struggle started, Russian forces destroyed an oil refinery in Kremenchuk that was managed by considered one of his corporations. This yr, the Ukrainian authorities nationalized that oil firm and one other related to him, citing what it described as a must safe key provides.

On Sunday, after Mr. Kolomoisky was positioned in pretrial detention, Ukraine’s state safety service mentioned in a assertion that Mr. Kolomoisky had laundered greater than half a billion Ukrainian hryvnias, or about $14 million, by transferring funds overseas between 2013 and 2020 via banks below his management.

Despite efforts to crack down on corruption, Mr. Zelensky’s administration has continued to be affected by scandals, together with within the procurement of meals for the army. Just final month, Mr. Zelensky ordered the dismissal of the administrators of the nation’s regional recruiting facilities, citing accusations that officers had been enriching themselves via draft evasion schemes.

In an obvious reference to Mr. Kolomoisky’s case, Mr. Zelensky in his nightly deal with on Saturday thanked the police “for their determination to bring every case stalled for decades to a just conclusion.”