On Slovyansky Azarov Says The Show Will Go On
Late last week, the Artemivsk District Court of Luhansk passed a sentence on the former managers of the Slovyansky Bank. Its Vice President Borys Feldman was sentenced to nine years with confiscation of property and a ban on holding managerial positions; Finance Department Chief Oleksandr Zaslavsky was sentenced to two years.
As the STA [State Tax Administration] Press Service noted, the sentence was passed only on two allegedly minor episodes in the financial machination case, the embezzlement of UAH 7.4 million [$1.39 million] and tax evasion in the amount over UAH 1 million [over $180,000]. The other episodes which, according to STA Chief Azarov, run into the tens are still being investigated, and it remains too early to close the Slovyansky case. “We have enough evidence of large-scale violations of law,” Azarov stressed.
Mr. Azarov calls the action on the case of the Slovyansky Bank “very instructive” and recommends all its participants “draw serious conclusions” from it. According to him, this concerns above all the “unprecedented pressure” on the judges during the proceedings: “There was everything: threats and blackmail, which is inadmissible in a civilized society.” Azarov said that the tax police filmed the trial and would show the public a documentary about it soon.
The clients of the bank were the Dniprovsky and the Makiyivka integrated steel plants, the Dniproblenerho electric company, the Malyshev Plant (Kharkiv), and others. Azarov believes that it would be possible to return the money to Slovyansky depositors in a year or two. According to him, most of them have got their money back, and now there remains about a thousand depositors who put in a total of UAH 30 million [$5.62 million]. The sooner the assets taken abroad are returned, the sooner the bank’s debts to its depositors will be cleared, he said. The STA chief is sure that one asset which is in Spain would suffice to return all the money to the depositors.
The proceedings against the managers of the Slovyansky Bank were instituted by the STA Investigative Department in January, 2000. They were indicted of gross embezzlement of UAH 11 million [$2.06 million], abuse of authority which resulted in UAH 335 million [$62.7 million] in damage, tax evasion of UAH 5 million [$930,000], and forgery. Initially, there were seven defendants, but later the court instituted separate proceedings against five defendants.
The Slovyansky Commercial Bank was founded in 1989. In 1999, with its assets amounting to UAH 230 million [$43 million], it ranked among the five biggest Ukrainian banks. Its annual profit reached UAH 83 million [$15.6 million], and the volume of deposits increased by 250%. In January, 2000 the National Bank of Ukraine decided to liquidate the Slovyansky Bank.
