U.S. seeks stiff penalties against Ukrainian oligarch

April 2

The U.S. Justice Department made it clear Wednesday that it is prepared to play hardball against a Ukrainian businessman who has deep knowledge of the workings of Gazprom, Russia’s giant energy company. It is seeking the forfeiture of virtually all his global assets.

Dmytro Firtash, who for several years has been the go-between linking sales of Russian natural gas to Ukraine, was arrested in March in Vienna on an American warrant for bribery. He is currently out on $172 million bail, said to be the largest bail in Austrian history. His spokesman said he is innocent and will fight extradition.

But if American prosecutors get access to him, they would be certain to seek whatever information he could provide about the deals that have made Gazprom a financial pillar of the Russian political system, and a main source of support for President Vladimir Putin.

Firtash and five others were indicted on charges of seeking to deploy $18 million in bribes in India to allow the purchase of titanium products. The indictment was obtained, and sealed, last June, but it was unsealed on Wednesday. It said that Firtash’s company, Group DF, had arranged the alleged bribes and had transferred money through American banks.

The deputy chairman of Group DF, Robert Shetler-Jones, said in a statement released Wednesday: “There is no truth to the accusations. It is not a coincidence that the U.S. is trying to extradite our chairman at the moment when Mr. Firtash is needed for the economic and political reconstruction of Ukraine. This is an abuse of the Austrian justice system for ulterior political motives.”

In the midst of the continuing hostile showdown between Washington and Moscow over Ukraine, in any event, American investigators will be more interested in Firtashs’s knowledge of Gazprom’s doings than the Indian case. The penalty he is facing if convicted is a severe one – forfeiture of his holdings in 159 different companies, and 41 bank accounts, all over the world.

Firtash, according to reports, is worth as much as $1.2 billion.

Gazprom is one of the main revenue producers for the Russian budget, and much of its income is from gas shipped to and through Ukraine onward to Europe. Gas sales have been at the heart of Ukraine’s difficult relations with Russia, and have helped define the course of Ukrainian politics.

Firtash was close to ousted President Viktor Yanukovych, and as a middleman on gas sales he reaped a fortune. Ukrainian analysts contend that Gazprom used its revenue to secure a hold on Ukrainian politicians, and that a great deal of its foreign income goes into hidden accounts that are available for Russian political leaders.

“Criminal conspiracies that extend beyond our borders are not beyond our reach,” said Zachary Fardon, the U.S. attorney for northern Illinois, in a Justice Department statement, referring to the allegations about the Indian bribe. “We will use all of the tools and resources available to us to ensure the integrity of global business transactions that involve U.S. commerce.”

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