Escape from Responsibility
The situation that emerged on October 9 in Hanover, where People’s Deputy Viktor Zherdytsky, was detained, cannot be called ordinary not only because again, like in the Lazarenko case, Western law enforcement bodies have apprehended a Ukrainian parliament member without the slightest allowance for his status and immunity. As in the Lazarenko case, the allegedly lawbreaking lawmaker was arrested when he was withdrawing money from a foreign bank account and then charged with the abuse of office and embezzlement. As The Day was told at the Ukrainian Embassy in Germany, German law enforcement believes that out of DM400 million Hradobank had received, when managed by Mr. Zherdytsky, to pay to Ostarbeiters (WW II slave laborers), 200 million were invested in dubious operations and 86 million vanished. Moreover, German police found in Europe a number of bogus firms into the accounts of which Zherdytsky transferred the money. He could face an up to ten year prison term for these crimes.
Ukrainian Prosecutor General Mykhailo Potebenko has already said his office possesses documents that he brought from Switzerland, which constitute grounds for instigating criminal proceedings against Mr. Zherdytsky. Mr. Potebenko is confident that Germany will extradite Zherdytsky to Ukraine, for there is an agreement to this effect. Mr. Potebenko said at a press conference on October 20 that the extradition problem can be solved when Verkhovna Rada gives its consent to Mr. Zherdytsky’s arrest and prosecution. The most interesting thing is that, according to Mr. Obykhod, Potebenko’s deputy, the Zherdytsky case also implicates Ihor Didenko, former acting chairman of the board of directors of the Naftohaz Ukrayiny national joint-stock company.
The latest news is that Mr. Zherdytsky, who had earlier refused to contact the Ukrainian Embassy in Germany, met Consul-General Oleksandr Novos iolov. Raising no claims against the German side, he still does not admit his guilt.
One of the aspects of this difficult problem is that the funds Hradobank received to pay compensation on behalf of the German side were furnished on a trusteeship basis, The Day was told in the parliamentary corridors. The bank was authorized first to put this money into other projects and draw a certain profit, and only then to pay the necessary compensation. Hradobank was granted some deferment because the competent bodies should compile the precise lists of compensation addressees, verify the data, and identify the specific amounts to be disbursed. Meanwhile, the money could work for the Ukrainian economy. Hradobank management decided to invest these funds in cement mills. But the mills changed owners and were involved in protracted arbitration hearings, which negatively impacted on production. The industry was thus half-ruined. The funds Hradobank had invested simply vanished.
Another aspect was disclosed by People’s Deputy Viktor Pynzenyk in the “Midnight Windows” television program on October 19. He maintained that Hradobank “was ordered” to issue a $5 million loan to a southern Ukrainian company. The bank refused to do so because it considered this operation too risky as was its right under law. But the company successfully sued the bank for $7 million “smart money,” which in fact meant destroying the bank.
The whole situation does not exactly build confidence in the government which precisely now is trying to hype in the West investment opportunities in Ukraine. Prime Minister Viktor Yushchenko has categorically denied his personal and the NBU’s involvement in the nonpayment of Ostarbeiter compensation, Interfax-Ukraine reports. Mr. Yushchenko has also noted he was “surprised” by the then government’s decision to place the assets of the Mutual Understanding and Reconciliation Foundation in a number of commercial banks rather than in the NBU. Then, according to Mr. Yushchenko, when Hradobank funds were written off in favor of the Antarctica Company by an Arbitration Court ruling contrary to the NBU position, it was no longer possible to ensure the financial stability of Hradobank. Does this mean nobody is guilty? What is also suffering is the image of state as a whole, already far from being positive, no matter how hard the President, Verkhovna Rada leaders, and the Ministry of Foreign Affairs might try to improve it. The Western press receives another reason for publications about Ukrainian corruption, playing on the feelings of citizens. It is difficult to explain to everybody that the Ukrainian government has assumed liability for the 86 million marks allocated for payment to Ostarbeiters by Hradobank, and so this will in no way affect the decision to grant a far larger amount to the Ukrainian partners of a newly-founded German foundation. The federal government of Germany has no claims against Ukraine in this matter. But still, this is bound to raise a purely subjective, but not entirely groundless, question: who, if anybody, can be trusted in Ukraine?
