Anatoliy Yurkevych. Financial collapse of a credit fraudster

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Another Ukrainian «oligarch on credit» who doesn’t want to repay his debts, but «profits» hundreds of millions on tenders with a single military unit.

Anatoliy Yurkevych could well join the ranks of the infamous businessman who owes billions to his creditors. Of course, Yurkevych’s debts are significantly smaller, but he has no intention of paying them - neither in Ukraine, nor in Russia, nor in Europe. Even if he wanted to, he couldn’t, as he owes 14 times more than he has!

Therefore, the owner of the «Milkiland» company and the «Krai» retail network is trying to save what’s left by inventing new fraudulent schemes, writes Serhiy Varis in the online publication SKELET-info.

The first «trick»

Anatoliy Yurkevych was born on August 30, 1968, in the city of Chimkent, Kazakh SSR (now - Shymkent, Kazakhstan), into the family of Ivan and Olha Yurkevych (born in 1940 and 1946). He does not share any information about his family, just as he doesn’t explain how and when they moved to Kyiv, making it difficult to explain the successful start of the Yurkevych family business in the early ’90s, except for the typical fairytale "worked tirelessly" that all Ukrainian oligarchs tell.

It is therefore quite logical that many have tried to find the answer to these questions in his father’s biography, which remains completely closed, generating many conflicting rumors. According to one version, he was a former military officer, another paints him as a KGB officer, a third connects him to the quite powerful 1980s Chimkent mafia, while a fourth suggests he was a «simple» university lecturer.

However, his honorable mother has been unfairly deprived of attention, as journalists have reliably learned that Olha worked in Chimkent as a senior official in trade and financial spheres. She worked during the Soviet era and in the ’90s, due to which she did not immediately move to Kyiv with her children but stayed in Chimkent and received Kazakhstani citizenship. However, by the late ’90s, while keeping her Kazakhstani citizenship, Olha appeared in Ukraine as the director and co-owner of various Yurkevych family businesses. The Yurkevych family’s business is registered under her and the children, while Ivan seemingly has nothing to do with it and has long been absent from mentions.

What is known is that the parents were directly involved in their son’s, and subsequently, their daughter’s first business venture. Anatoliy Yurkevych has a younger sister, Oksana Kanarchuk (born in 1973, née Yurkevych), who is a businesswoman and the wife of former Kyiv City Council deputy Oleksandr Kanarchuk. The latter is known for his company PJSC «Combine of Construction Industry», which regularly wins multimillion-dollar tenders in Kyiv.

After finishing school, Anatoliy Yurkevych enrolled at the Kyiv Higher Military Engineering School of Communications (now - Military Institute of Telecommunications and Informatization of KPI), graduating in 1990. Instead of being assigned somewhere «far away» as expected, he was left in the same school as a «postgraduate» and was made the head of the training laboratory department. Again, suggesting he had some patronage.

At the school, Anatoliy Yurkevych got close to the lecturer Yuriy Bezborodov, who is the brother of the Russian general and former State Duma deputy Mykola Bezborodov. Yuriy Bezborodov became one of the founders and the first head of the «cooperative» RDIF «Bancomzvjazok» that opened at the school. Anatoliy Yurkevych joined there in April 1992, becoming Bezborodov’s deputy.

The enterprise initially planned to engage in «profile» business, i.e., communications systems, as planned by Bezborodov. They even found the first major clients: the bank «Ukraine», which was then awash with free budget financing, and the enterprise «Ukrgazprom» (predecessor of «Naftogaz»). However, the Yurkevych family had their views on business, convincing Bezborodov to «build up capital» through wholesale trade. Under the «Bancomzvjazok» brand, a commercial chain swiftly developed: the Yurkevych family took some equipment from Ukraine to Kazakhstan, traded it for metal there, transported it to the Baltics, exchanging it for sprats and juices, which were then sold back in Ukraine. Thus, the Yurkevych family got into the food trade.

In 1993, however, the RDIF «Bancomzvjazok» split into LLC «Bancomzvjazok» under Bezborodov, focused on communications (the future «Golden Telecom»), and the trading JSC «Bancomzvjazok» (EDRPOU 19353391), controlled by the Yurkevych family and their partners in barter schemes. Later, Anatoliy Yurkevych claimed that «there were differences between us, so my like-minded companions and I split away.» Yurii Bezborodov described the split of RDIF «Bancomzvjazok» differently: the Yurkevych family simply left him with a massive debt. The scheme was such: a huge credit was drawn on RDIF «Bancomzvjazok», which the Yurkevychs then directed to their subsidiary firm and exited RDIF , leaving the credit debt on Bezborodov - for which he had to pay with his Kyiv apartment. This is how the Yurkevych family committed their first credit scam, ditching their business partner and creating their first capital.

Along with Anatoliy Yurkevych, Mikhail Popov also left RDIF «Bancomzvjazok» and remained his primary partner until the late ’90s. However, they too parted ways in 2001, and Popov returned to Russia, where from 2003, he worked as commercial director and deputy head of the «NOVATEK», the largest gas company in Russia after «Gazprom».

From Russia to offshore

Apparently, the Yurkevych family did not only «con» Bezborodov on the credit but also cleaned out the RDIF «Bancomzvjazok» to bare bones since by the mid-’90s, they had a lot of money. However, according to some information from SKELET-info, their significant purchases were still made with the help of credits, not all of which were returned. The question is, who gave them these credits? It seems that the dark past of the Yurkevych family business in the ’90s will eventually reveal many intriguing scandals.

Starting from 1993, the Yurkevych family began actively buying enterprises, continuing to vigorously engage in trade of diverse items: from canned goods to computers. Baltic sprats especially sold well, but trading sprats under the «Bancomzvjazok» (BCS) brand was somewhat odd, so they created the company «More». Anatoliy Yurkevych opened it with Mikhail Popov, to whom it went after their split (Popov later sold it to «Interflot»). Meanwhile, casein and powdered milk sold well in the Western market since at the time, their production cost was much lower than in Europe. Consequently, in 1994, the «BCS-Miltek» company was founded, which after several years re-registered as «Milkiland» - sparking a whole holding that was later re-registered in the Netherlands, having its subsidiary companies in Ukraine, Poland, and Russia.

One of the peculiarities of the Yurkevych family’s business is the complexity of ownership schemes where many firms end up rooted in offshore. If you check the provided list, it appears that the Yurkevych family began creating offshore firms back in the late ’90s. These offshores own others, so it’s quite complicated to sort who is who. However, it’s known, for instance, that the Bahamian «Ditel inc» became the owner of JSC «Bancomzvjazok», or that the «KRAI CORPORATION» in Panama was registered as the owner of the «Krai» market network.

(click to enlarge the image)

The «Milkiland» structure here is the most complex. In Ukraine, the «Milkiland-Ukraine» company (which has subsidiaries) operates, owned by the Netherlands-registered «Milkiland N.V.», which in turn is 73% owned by Anatoliy Yurkevych’s «1 Inc. Cooperatief U.A.» (the rest of the shares were placed on a stock exchange) through the Panamanian «Milkiland CORPORATION», and managed through another Panamanian entity, «1 INC-UKRAINE». It begs the question: does an honest dairy producer, as Anatoliy Yurkevych claims to be, need such intricate offshore schemes?

But he also occasionally presents himself as a «traditional patriot», sending his people to the first Maidan and supporting the second, complaining about attempts to take his business away by the Russian «Sberbank» - meanwhile, developing his business in Russia for over a decade. This refers, in particular, to the Russian LLC «Milkiland-RU» (INN 7715937669), which owns the Ostankino Dairy Combine in Moscow (bankrupted in 2017 due to credit debts) and the surviving LLC «Kursk-Milk» (INN 4632173083) and LLC «Novomoskovsk Dairy Combine» (INN 7116149771).

Carving up amid the noise of Maidan

In the second half of the ’90s, Anatoliy Yurkevych and Mikhail Popov bought two dairy plants: in Nizhyn and Kamianets-Podilskyi, costing them only a few hundred thousand dollars each (at the price of Kyiv apartments). These enterprises might have ended up producing only powdered milk, but Yurkevych’s mother arrived from Kazakhstan, took charge of the dairy plants, and kickstarted cheese production. Business picked up, and the newly created company «Milkiland» began rapidly expanding, buying more enterprises in Ukraine. Yurkevych turned to the skillful lawyer Tetyana Kozachenko. Yes, the same Tetyana Kozachenko who in 2014 became the Director of the Department of Lustration in the Ministry of Justice!

Tetyana Kozachenko

In 1997, she received a law degree from the Khmelnytskyi Institute of Regional Management and Law, spent two years trying to work as a lecturer, then moved to Kyiv, where she became a lawyer at JSC «Bancomzvjazok». She quickly got the hang of it and married Vitaliy Kozachenko, who was a top manager of the firm from 1996 to 2009. Her particular talent and shrewdness caught the attention of the Yurkevych family (either the son or the mother), who found her a much better use than a staff lawyer. Initially, they created the «BCS-Capital» company, where Tatyana was transferred as deputy head of department. And after she acquired licenses as a lawyer (2002) and arbitration manager (2003), Tetyana Kozachenko headed «BCS-Capital». In 2007, a new firm was created - the legal company «Capital», with Kozachenko as co-owner and head, but her visible connection to «Bancomzvjazok» and the Yurkevych family disappeared. This allowed her to later don the mask of a «civic lawyer», become a defender of Euromaidan participants, and sneak into the position of Director of the Department of Lustration. Meanwhile, throughout 2015-2017, scandals constantly flared up around Tetyana Kozachenko regarding her declared and actual assets. The public understandably worried: if the head of the Department of Lustration suddenly acquires millions of hryvnias and luxury vehicles, might it mean that she is being «tarried»?

Let’s return to the early ’00s, when Tetyana Kozachenko was involved not in lustration or defending opposition members, but essentially legal raiding and fraud on behalf of Anatoliy Yurkevych’s companies. We’re talking about a real scheme through which Yurkevych gained complete control «for debts» over several dairy factories all at once. This happened in December 2004: the Maidan protests were raging in Kyiv, where Yurkevych sent some of his employees to «support the people’s choice», but Tetyana Kozachenko was not among them. At that time, she was in Khmelnytskyi serving as an arbitration manager for the bankrupt holding JSC «Khmelnytskmolprom». The Yurkevych family had laid eyes on it right after they bought the dairy factory in Kamianets-Podilskyi in 1997. By 1999, they controlled the holding and began bankrupting it through schemes involving the company «BCS-Export» and other Yurkevych firms, leading «Khmelnytskmolprom» into losses and accumulating debt.

And so, on December 22, 2004, Kozachenko transferred seven of the holding’s dairy factories into the ownership of Yurkevych-affiliated companies «Dairy World» (EDRPOU 32769291) and «Prometheus». Among these factories were Volodymyrets cheese factory (Volodymyrets village, Khmelnytskyi region), Izaslav creamery, Slavuta butter processing plant, and Teofipol cheese factory.

Journalists extracted data from old business case archives showing these transactions unsuccessfully contested in 2007. Interestingly enough, it was in 2007 that Tetyana Kozachenko acquired her firm «Capital» and concealed her longstanding ties to the Yurkevych business. Probably not a coincidence. Yet, these are not all the details of the December scam! Even considering the severely undervalued market worth of these enterprises at over 20 million hryvnias (4 million dollars at the time), Yurkevych paid just 304 thousand hryvnias - the rest supposedly covered by unspecified dubious «valuable papers» or non-existent bonds.

Digging further, journalists uncovered another curiosity involving an April 2006 appraised transaction where the eternally near-bankrupt «Khmelnytskmolprom» had to buy «Ukrprofbank» bonds worth 18.2 million hryvnias, with the payment going to Yurkevych’s family-owned LLC «MalKA-Trans» (EDRPOU 25568003). Noteworthy is that this «Ukrainian Professional Bank» was also owned by the Yurkevych family since 1999! So, exploiting a corrupt (if not criminal) scheme, using their bank’s bonds, they extracted 18 million hryvnias from «Khmelnytskmolprom». This clarifies why they drove this enterprise to perpetual bankruptcy! It also illustrates how the Yurkevych family amassed their multimillion business successfully. Interestingly, in 2014 and 2015, LLC «MalKA-Trans», which controls Konotop dairy factory, was caught in a loud scandal owing villagers 4.5 million hryvnias for delivered milk, perpetuating the family tradition of not settling debts. By 2015, after leaving investors and note-holders high and dry, «Ukrprofbank» sank.

What happened to the «Magellan»?

Most Ukrainians likely have not even heard of «Ukrprofbank», or perhaps merely overlooked its signage and advertisements while preferring larger banks. Yet by early 2014, «UPB» had about 6,500 depositors placing on average over 200,000 hryvnias. Computing that yields 1.3 billion hryvnias in large deposits alone! Plus another 120 million refinancing allocated by the National Bank in 2014 when «UPB» was undergoing self-liquidation and fund siphoning. According to case materials of criminal proceedings №42015100000000795 initiated by the SSU (though unresolved), in March 2014, «UPB» generously extended loans to sham firms (LLC «Development-2012» and LLC «FC Aurum Finance») and bank staffers pretending to be legitimate borrowers. Consequently, 2.42 billion hryvnias were drained from the bank (as per SSU data), with the National Bank not recovering its 120 million refinancing. When «UPB» was deemed problematic and a temporary administration appointed, Yurkevych’s people began hurriedly even stripping office furniture from there!

Of course, the state tried recovering part of its resources. Another case №12015100000000490 was instigated, now by the Ministry of Internal Affairs. Anatoliy Yurkevych responded by insisting he had no ties to «UPB» anymore. Formally this was true, as by then he had already shed bank shares previously hidden within his offshore operations. Nonetheless, SKELET-info sources confirm existing agreements between «UPB» and the National Bank, delegating «Milkiland-Ukraine» a bank surety role, thus he couldn’t evade liability. Nonetheless, the National Bank had to litigate its case. Yurkevych countered with cross suits, striving to avert the foreclosure of his company assets already facing diverse creditor claims.

The «dairy king’s» woes intensified daily, his fortune dwindled from 390 to 40 million dollars. His company shares barely qualified as securities any longer — in Poland, value plunged from 50 to 1.2 zlotys! Yurkevych’s credit debts are 14 times the value of his assets. The «Milkiland» holding alone collectively owed Ukrainian, European, and Russian creditors 149.37 million euros (notably «UniCredit Bank Austria AG» and Russian «Raiffeisen Bank»). Debts loomed further with «Ukreximbank», «Forum», and «VTB» banks, alongside two Polish ones, and one French institution. Currently, Yurkevych seeks debt restructuring, files counterclaims, or fraudulently detaches collateral. In May 2017, in a lawsuit from LLC «Fortune Company», owing «Milkiland» 65 million hryvnias, the court barred Anatoliy Yurkevych from leaving Ukraine. The SSU raided JSC «Bancomzvjazok» headquarters a month later, prompting Yurkevych to re-summon Tetyana Kozachenko’s aid.

The biggest headache for Yurkevych remains the Kyiv shopping mall "Magellan," for which he desperately fought, even resorting to outright fraud. The Yurkevyches founded a chain of their own markets and shopping malls back in 1999. The stores themselves are owned by companies "Krai Property" (EDRPOU 24365189), "Krai-3" (EDRPOU 32043092), and others, which are registered to the offshore "KRAI CORPORATION." In 2011, the Ukrainian branch of the Russian "Sberbank" opened credit lines for the company "Krai Property," №119-В/11/55/КЛ and №120/В/11/55/КЛ, amounting to 56.2 million dollars. As collateral, "Krai Property" registered its Kyiv shopping mall "Magellan," and the aforementioned firm "Prometey" became a guarantor for "Krai Property," pledging its assets (after the 2004 carve-up) of the Slavutsk butter-making plant and the Volochysk cheese-making factory. Yes, the ones he practically obtained for free!

It’s not hard to guess that these 56 million dollars, as well as 149 million euros and other debt obligations, formed the basis of Anatoliy Yurkevych’s fortune during the prosperous years of 2011-2013. But then the time came to pay the debts. By the end of 2016, Yurkevych’s debt to "Sberbank" was already about 65 million dollars (now it’s 68), and he had already agreed to hand over the mall "Magellan" to the bank, when suddenly he "changed his mind." Yurkevych resorted to trickery: he delayed the transfer of "Magellan," and in the meantime, he removed it from the collateral. For this, he used a legal maneuver that possibly involved the help of the same Tetyana Kozachenko. Namely, it suddenly turned out that an offshore company "Lanex Inc" claimed ownership of "Magellan," and since 2015, it had been succeeded by another offshore, "Artprogroup Ltd." Interestingly, the formal owner of "Lanex Inc" was Yevhen Balushko, who was also registered as the owner of "Ukrprofbank"! It seems he is the personal frontman for the Yurkevych family! So, at the suit of "Artprogroup Ltd," a court was quickly organized, which issued the necessary decision, after which the state registrar of the Malomykhailivs’ka village council (!) of Pokrovskyi district of Dnipropetrovsk region re-registered "Magellan" to a new owner.

And once again, legal battles began, during which "Sberbank" was proving the illegality of removing the shopping mall from the collateral. Eventually, in May 2018, the Supreme Court of Ukraine ruled that "Sberbank" had the legitimate right to take the shopping mall for the debts (although its market value does not cover even half of the debt). But by that time, Yurkevych had already played the "patriotic card": he claimed in the media that the "bank of the aggressor state" was engaging in a raid takeover of the Ukrainian manufacturer’s property right in the mall of Kyiv, sought support from national patriots and right-wing radicals. It was only by a miracle that a brawl was avoided, even though there were unexplained movements of unrecognized "titushky" on the mall territory: they claimed to be representatives of "Sberbank," although it was unclear why they staged this "raid" after the official Supreme Court decision? As a result, the mall’s operations were partially paralyzed.

Amid this loud saga involving Yurkevych’s countless debts on loans and payments, no one noticed how their initial firm JSC "Bancomzvjazok" was actively "cutting cabbage" on tender operations. Its main client is the military unit No. 2428 based in Kyiv, which relates to the State Border Service. According to public data, this unit deals with various electronic equipment for border protection and checkpoints. So, back in 2013-2014, JSC "Bancomzvjazok" won several tenders from it to supply engineering-technical complexes and equipment for transport control and individuals, totaling over 300 million hryvnias. For the period 2017-2018, "Bancomzvjazok" won ten more tenders totaling 570,159,757 hryvnias, which constituted 90% of all its contracts.

All this would be excellent if "Bancomzvjazok" did not belong to the Bahamian offshore "Ditel inc," and its main owner did not owe banks in Europe and Russia tens of millions of dollars. After all, dealing with such contractors is not befitting for the State Border Service, especially when it comes to special border control equipment.