WASHINGTON — Newly found documents show that three companies with links to ousted Ukrainian president Viktor Yanukovych are also connected to the money-laundering scandal uncovered by Sergei Magnitsky, the Russian lawyer who died in prison after exposing high-level fraud and embezzlement among Russian officials.
An investigation by Hermitage Capital Management, the investment firm for which Magnitsky was employed, shows the companies named in the documents uncovered at Yanukovych's presidential palace are registered at the same United Kingdom address, and share the same offshore shell companies and Latvian directors as were found in Magnitsky's investigation.
An employee of Hermitage sifted through the documents uncovered by Ukrainian journalists after Yanukovych's flight from Kiev and posted to YanukovychLeaks.org, a website created to compile the nearly 200 folders of documents found at the estate. The employee found that three companies mentioned in the documents as holding some of Yanukovych's assets or being otherwise tied to the president — Navimax Ventures, Roadfield Capital LLP, and Fineroad Business LLP — had strong links to entities exposed in Magnitsky's investigation into $230 million in tax revenues which were stolen by Russian officials from Hermitage holding companies. The results of Hermitage's inquiry were provided to BuzzFeed by Kleiner and William Browder, the head of Hermitage.
In his investigation, Magnitsky followed $40 million to a Latvian bank account for Technomark Business Ltd., a U.K.-registered company with an ownership in Nevis. Technomark shared the same registering address as Navimax, and the names of its Latvian directors also appear in documents relating to the other two companies.
According to reporting by Ukrainskaya Pravda, a Ukrainian newspaper, and cited in Business New Europe, Navimax "features in the ownership structure of a major Donetsk coal trading company, Donbassk Clearing and Financial Center ('Donbasskii raschyotno-finansovyi tsentr – DRFTs'), founded in 1999. DRFTs has long been associated with Yanukovych, who in 1999 became governor of the Donetsk region, the first step in his path towards the presidency."
The coal company, DRFT, traded coal from illegal mines. A second company, Roadfield Capital LLP, was found to be the lessor of a Yanukovych estate in Crimea. Fineroad Business LLP, a third company, is the shell company that owned a building and data center built with money from the holding company that owned Yanukovych's Mezhyhirya estate, where the documents were found.
The following charts provided by Hermitage show the links between the Russian and Latvian entities exposed in the Magnitsky investigation and the companies with ties to Yanukovych.
Browder, once the biggest portfolio investor in Russia until he was barred from entering the country in 2006, has been one of the main forces behind the Magnitsky Act, which bans human rights abusers from entering and keeping money in the U.S. The act is named after Sergei Magnitsky, Browder's former lawyer, who was arrested after uncovering the corruption and died in a Russian prison in 2009.
Browder said the links between the companies show a region-wide level of corruption.
"It's interesting because what it says is that the criminality in that part of the world is all one big group," Browder said. "And if not one big group specifically, they're working with the same money launderers. Once you start pulling on the thread of one thing, you find everybody else, which is one of the reasons they were so terrified of [Magnitsky's] investigation."