On the threshold of the presidency he promised to sell his assets. But after two years, the Ukrainian president is still running his chocolate factory and a network of offshore companies. And he’s getting richer.
A chocolate empire, Roshen, estimated at $ 3 billion, stakes in car factories and shipyards plus the Channel 5 TV station. And yet, when he was still a candidate, he was clear: “I will make a point of selling my assets immediately after occupying the post”.
Today that he is the President of Ukraine, not only does he continue to run his business, but he appeared in the Panama Papers as holding companies in tax havens. And he is also the only member of the Ukrainian super rich to have seen his wealth grow despite the serious economic crisis that is crushing the country and the war that sucks up precious resources. His personal wealth has reached $ 858 million.
In the wake of the Panama Papers scandal, Poroshenko was quick to tweet that “Having become a President, I’m not participating in management of my assets, having delegated this responsibility to consulting and law firms”. But the reality seems more complex.
The web of companies
The investigative reporter of the Organized Crime and Corruption Reporting Project, OCCPR, were on Poroshenko neck and found that even after assuming the presidency he continued to manage his network of companies through Prime Assets Capital (a holding company registered in Ukraine, of which he is the sole beneficiary according to the register of companies) and the International Investment bank, of which he owns 60%, both through the same Prime Assets Capital and on a personal basis, according to public data of the Ukrainian national bank. According to the OCCPR investigators, the bank is the central hub of a web of companies and his investments are still very active.
Roshen’s CEO, Vyacheslav Moskalevsky, said that attempts at sales have been made, but that “Nobody can sell anything here now”, referring to the disastrous state of the Ukrainian economy and uncertainty caused by the war. That’s why Poroshenko transferred the ownership of Prime Assets Capital to a blind trust managed by the Swiss company Rothschild Trust.
The documents leaked by Mossack Fonseca in the Panama Papers show, however, that Poroshenko has continued to manage activities related to his business. In August 2014, when he had been president for four months, he registered an offshore company at the British Virgin Islands, Prime Assets Partners Ltd. Poroshenko justified by saying that it was a ploy to make the sale of Roshen more attractive to foreign investors . In any case, Poroshenko failed to report the company on his income disclosure statements, in violation of the law.
Skyrocketing profits
According to the Panama Papers more companies appear to be linked to Poroshenko, such as Intraco Management, registered in the British Virgin Islands, and Chartomena Ltd, registered in Cyprus. The first is owned by Serhyi Zaitsev, a top manager at Roshen. Leaked documents from the Mossack Fonseca show that Prime Asset Partners would serve as the holding company for the Ukrainian and Cyprus companies and that Poroshenko is its sole owner. Among the papers there’s also a photocopy of Poroshenko’s passport.
The president said that the offshore companies were vehicles part of the setting up of the blind trust, but the process has not been completed yet. That doen’t explain the fact that the two companies were registered, respectively, in 2005 and 2012, years before Poroshenko became president.
The web of companies is just one of the shadows gathering over Poroshenko’s presidency. The others are the amazing results for his businesses since he became president. In 2015 the International Investment Bank recorded profits of $ 1.3 million, saw its assets increase by 85% and increased its capital by 18%. The fourth best result among all Ukrainian banks, a sector marked by a deep and generalized crisis.
(to be continued)
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On the threshold of the presidency he promised to sell his assets. But after two years, the Ukrainian president is still running his chocolate factory and a network of offshore companies. And he’s getting richer.
