December 03, 2019
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Rudy Giuliani sought role in Ukraine bank case while he dug for dirt

Charles Krupa | AP
Charles Krupa | AP
In this Aug. 1, 2018, file photo, Rudy Giuliani, attorney for President Donald Trump, addresses a gathering during a campaign event in Portsmouth, New Hampshire.

Rudy Giuliani discussed representing a state-owned Ukrainian bank in a legal dispute over the summer even while publicly pressing Ukraine on behalf of the U.S. president.

Though he ultimately did not take on the client, the talks expose his enthusiasm for foreign business and his willingness to insert himself in matters rife with potential conflicts. In fact, the Ukrainian bank is entangled in a legal dispute with its former owner who has ties to Ukraine’s president and is the subject of a federal investigation in the U.S.

The former New York City mayor and personal lawyer for President Donald Trump, Giuliani said he was approached by lawyers for Privatbank seeking to recover assets linked to the previous owner. They wanted to know if Giuliani — who had written tweets critical of the man — could assist their civil suit, Giuliani confirmed by phone Thursday.

He met with the lawyers at Quinn Emanuel about the case, though they parted ways with no agreement. Quinn Emanuel declined to comment. Privatbank said in an email that it “has not been approached by Mr. Giuliani and has not considered engaging him in any capacity.”

The dispute between Privatbank and the previous owner, Igor Kolomoisky, is politically charged. Ukraine’s last administration nationalized the bank in 2016 and accused Kolomoisky and his co-founder of making away with billions of dollars. Civil suits have followed as the bank seeks to recoup various assets in the U.S. and U.K. as ill-gotten proceeds.

Kolomoisky not only had ties to the new Ukrainian president, who appeared in a TV comedy that aired on his network, but also is under investigation by U.S. federal authorities. He denies that he took money from the bank improperly.

During impeachment hearings in Washington, Giuliani asserted on Twitter that he has no financial interests in Ukraine. He has done business in the country, however, including security consulting for the city of Kharkiv. He is also the honorary mayor of Anatevka, outside Kyiv.

Publicly and privately over the past year, Giuliani pushed Ukrainian officials to announce an investigation of Ukraine influence in the 2016 U.S. election and of a matter that would embarrass a Trump political rival, former vice president Joe Biden. Lawmakers are asking — and federal prosecutors are investigating — whether Giuliani’s efforts amounted to soliciting foreign interference in a U.S. election or bribery in violation of U.S. laws. Several impeachment witnesses have testified that they did not want to work with Giuliani on Ukraine policy, though they were directed to do so.

Two associates of Giuliani reportedly tried to parlay access to the Trump administration to enrich themselves while searching for dirt in Ukraine. In late April, Lev Parnas and Igor Fruman approached Kolomoisky and offered to get senior Trump officials to come to Kyiv in support of the new government for a fee. Kolomoisky refused. Parnas and Fruman have since been charged with violating campaign finance laws for their work elsewhere in the U.S.

Lawyers for Parnas, who has said he would cooperate with impeachment proceedings, and Fruman didn’t respond to requests for comment.

Kolomoisky provided an early push for the new president, Volodymyr Zelensky. The wealthy Ukrainian owned the television network on which the comedian gained enough prominence to mount a successful political campaign on a platform of battling corruption. Until Zelensky was elected, Kolomoisky had been in exile in Israel and Switzerland. He flew back to Ukraine only after that victory.

The new president has continued to press for reform in the corruption-riddled country and has kept a measured distance from his former patron. In fact, Zelensky’s office said in a statement last month that it would oppose any attempt to transfer Privatbank to its previous owners, as a court ruling supported before the election.

Kolomoisky co-founded the bank with Gennadiy Bogolyubov in 1992, becoming one of the country’s most prominent billionaires and, later, funding a private militia to fight a Russian incursion in eastern Ukraine.

After the bank suffered $5.6 billion in losses, Ukraine’s government seized and recapitalized it. In a subsequent lawsuit filed in the U.K., the nationalized bank alleged its former owners misappropriated nearly $2 billion. For their part, Kolomoisky and Bogolyubov have called the takeover politically motivated.

After Zelensky’s landslide presidential victory in April, Parnas and Fruman approached Kolomoisky in Israel, saying they could help arrange for senior U.S. officials such as Vice President Mike Pence and Energy Secretary Rick Perry to come to Zelensky’s inauguration, according to Bruce Marks, a U.S. lawyer representing Kolomoisky.

The pair sought a payment of about $200,000, Marks said. After rebuffing them, Kolomoisky portrayed the men in Ukrainian press interviews as suspicious characters trying to use their Giuliani connection to extract money.

Giuliani countered in a May 18 tweet that Kolomoisky was threatening and defaming the men. He also repeated a claim that Kolomoisky was “super dangerous.”

Soon after this dustup, the Ukranian bank took its fight to the U.S. courts. Privatbank filed a suit in Delaware Chancery Court against its two founders, three U.S. associates and related entities. It alleged that from 2008 to 2016, Kolomoisky and his partner defrauded the bank of billions of dollars — and that the U.S. associates plowed much of the money into U.S. assets, including office buildings in Cleveland and an Ohio steel mill.

Giuliani’s Kolomoisky tweets caught the attention of Privatbank’s lawyers as well as lawyers for Ukraine’s banking regulator, according to a person familiar with the matter. The regulator’s lawyers suggested contacting Giuliani to see if he had any information related to Kolomoisky and misconduct.

Starting in August, Giuliani had two meetings with Quinn Emanuel lawyers. He reviewed a report conducted by the investigative firm Kroll on behalf of Privatbank, Giuliani said this week, saying it outlined problematic activities by several Ukrainian oligarchs, including Kolomoisky.

“We mutually agreed that the case is fantastic,” Giuliani said.

The Quinn Emanuel lawyers didn’t see any role for Giuliani, because he lacked independent knowledge of Kolomoisky’s past conduct, according to the person familiar with the matter. For his part, Giuliani said the timing was not right.

The Privatbank matter has attracted other high-profile lawyers in Trump’s circle. Last week, the three U.S. associates of Kolomoisky who are defendants in the suit hired Marc Kasowitz and his law firm, Kasowitz Benson Torres. Kasowitz is best known as the New York lawyer who helped Trump organize his legal response to the Russian influence investigation conducted by special counsel Robert Mueller in 2017.

Bloomberg writers Christian Berthelsen and Stephanie Baker contributed to this report.

 



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