Bankruptcy or nationalization? Russian owner uses ComInBank in Ukraine for financial fraud

A wave of nationalization is coming to Ukraine to companies affiliated with the Russian aggressor. On April 1, 2022, the Ukrainian parliament regulated the seizure of Russian assets, authorizing the nationalization of companies whose owners are both legal entities associated with the aggressor and individuals who are citizens of the Russian Federation. The National Security and Defense Council began the process by cleansing the banking sector, authorizing the seizure of the assets and corporate rights of the Russian Prominvestbank and the International Reserve Bank.

In addition to the two aforementioned financial institutions, the Russian owner owns a small “Commercial Industrial Bank,” also known as ComInBank. This bank is registered in the name of British investor Stephan Paul Pinter. Yet, it is actually owned by Yevgeny Kazmin, a Crimean businessman with a Russian passport involved in criminal cases. Along with other banks affiliated with Russia, ComInBank should also be nationalized. Moreover, the financial institution is engaged in laundering and transferring funds abroad, which are then invested in the owner’s business in temporarily occupied Crimea.

“The leaders are crooks, and all the signatures are forged.”

ComInBank has long belonged to Yuriy Sidorenko, head of the EDAPS Consortium. In 2015, Yevgeny Kazmin, a Crimean businessman, negotiated with Sidorenko to buy the bank for $4.2 million. Since then, ComInBank has been mired in scandal and criminal cases.

The former head of ComInBank’s security service, Anatoly Mazur, recounts the details of Kazmin’s purchase of the financial institution. According to him, the businessman had no legal means, so he had to deceive the National Bank of Ukraine (NBU) during the purchase. The lawyer hired by Kazmin for registration of the bank purchase filed a falsified declaration with the NBU. It stated that the source of funds for the purchase of the bank was the sale of coins to a dead person, bought from a dead person, and the deal was made by a dead employee of the tax service. The NBU did not believe this story and did not allow Kazmin to take over the bank. As a result, offshore companies established by employees of the Crimean businessman’s companies became fictitious shareholders of ComInBank.

In March 2016, Kazmin became the head of the bank’s supervisory board. Soon, the National Bank recognized him as the ultimate beneficiary of the financial institution. Anatoly Mazur says that “Kazmin saturated the bank’s management with crooks.” In particular, the personnel department was unofficially headed by Anna Venglinskaya, a dermatologist and mistress of Kazmin. “She fired ComInBank’s professional management, replacing it with people who shuffled virtual loans and did not do much with the accounting documents,” Mazur says.

According to Mazur, who had access to documents and meetings of top management, ComInBank became a financial hole after the change of ownership. “According to the documents, they are doing fine. But if the NBU comes there with an inspection, it will turn out that there’s nothing there – it’s a hole. And of course, a temporary administration should be introduced there.”

Looking ahead, we should say that rumors about introducing a temporary administration in ComInBank were already in circulation before the Russian invasion of Ukraine when it became known that the bank was involved in schemes for withdrawal of funds from the country. These plans were probably postponed due to the war.

Anatoly Mazur says that Kazmin did not want to bring funds from his offshore companies to the bank, so he attracted new working capital from the market. And then this money disappeared. The loans were made to Kazmin’s companies and to persons related to him. “Corporate responsibility was blurred. They took any employee of the company, for example, an accountant, and said – you will be the founder; they took a lawyer – you are the director now. There were different names on the documents, but these are all employees of the holding who depend on Kazmin. They were forced to choose: either they follow the instructions of their manager, or they do not work there anymore… And if there is a trial of the National Bank regarding where the money has gone, innocent people will suffer, but not Kazmin”, notes the former head of the SB Bank.

He adds that the bank’s Supervisory Board never gathered in 2016 to make decisions, and all the signatures on the documents are forged.

Business in occupied Crimea, Russian passports, and Kremlin watches

On April 28, 2016, Kazmin was detained by officers of the Security Service of Ukraine on suspicion of financing separatism in Crimea. In simple words, the Security Service found out that after the annexation, the businessman continued to do business in the occupied peninsula, paying taxes to the Russian budget. Kazmin was sent to the detention center.

Here it is necessary to say a few words about who Kazmin is and what he does. Back in the early 2000s, he started collecting and disposing of scrap metal in Sevastopol, and later got involved in the construction business. Then the business expanded to the mainland Ukraine, and a group of companies, “KVV Group,” appeared. Kazmin himself became a deputy of the Sevastopol City Council from the Party of Regions. In 2012, he was even on the list of Yanukovich’s party for the elections to the Verkhovna Rada, but could not get into parliament.

When Russia occupied Crimea, Kazmin left for the mainland and stated that he did not do business on the Crimean Peninsula and had nothing to do with ownership, strategic and operational management of construction sites in Crimea.

Quite quickly it turned out that this was not true. The Kazmin family re-registered its assets in the Russian Federation and continues to operate in Crimea. Crimea.Realities found out that the business of the Kazmin family remaining in Crimea is extensive. Karbon LLC, previously owned by Yevgeny Kazmin, actively built real estate in Sevastopol and other regions of the peninsula for many years.

In November 2014, the company was re-registered under Russian law. Then, Yevgeny Kazmin’s name disappeared from the list of founders and managers. At the moment, the firm is owned by his brother, Vladislav Kazmin.

There are other enterprises owned by members of the Kazmin family in the State Registry of Enterprises and Organizations of Russia. They still receive large contracts from the Russian state budget. Moreover, journalists found out that these firms, through a chain of offshore companies, helped Kazmin build housing in Ukraine.

In addition, Anatoly Mazur, the former head of the security service of Kazmin’s holding company, claims that even after the annexation of Crimea, the businessman illegally exports scrap metal to Turkey from the peninsula.

The Security Service of Ukraine accused Yevgeny Kazmin of the fact that under his direct supervision, housing was being built in Crimea, some of which were intended to be provided free of charge to employees of the Russian Federal Security Service and the Ministry of Internal Affairs of Russia. We are talking about the so-called “Peace Town,” which Kazmin’s company “Carbon-Story” was building in the vicinity of Simferopol.

During the searches, Kazmin was found to have a Russian passport. In addition, the investigation obtained evidence that the businessman had received Russian citizenship. Among other things, the investigation found a wristwatch with the Russian coat of arms and the inscription “Moscow-Kremlin,” apparently given to the defendant for special services to the “new” fatherland.

However, despite the documentary evidence that appeared in the case, five months later, the prosecutor in charge of the criminal proceedings petitioned for Kazmin’s exemption from criminal liability. The reason for this was allegedly the fact that the suspect had voluntarily informed the investigation about his financial activities, which were subsequently the subject of the proceedings, even before he was charged with the relevant article.

When the owner of KVV Group was released, he found out that he had lost part of his business. It had been taken away by raiders from his business partners. Kazmin himself had previously acted in a similar way when he raided the ATEK factory in Kyiv.

A British owner on paper, but a Russian one in reality

Despite the partial loss of business, Kazmin retained the bank. Back in the summer of 2016, while in pretrial detention, he allegedly sold the bank to a “foreign investor.” In fact, it was a re-registration of the financial institution to a figurehead, the British investment banker Stephen Paul Pinter, in order to save the asset.

Despite the fact that the legal address of the bank is Bulvarno-Kudryavska, 6 in Kyiv, the real location of the office is Predslavynska, 28. It is at this address that Kazmin’s KVV Group office is located.

Our source at the bank claims that at Predslavynska, Kazmin personally takes part in meetings of the board and essentially manages the financial institution.

The bank’s security service is headed by Andrei Ryazhsky, who is also the head of KVV Group’s security service. Until September 2016, Ryazhsky was the head of the security service of Kazmin’s company “Karbon,” which is still owned by the businessman’s family and pays taxes to the Russian budget.

Many employees of the KVV Group still work in the bank. And the lawyer Evgeny Porada, who in 2015 falsified documents for Kazmin’s purchase of the bank, is now deputy head of the ComInBank’s supervisory board.

In the photos, Kazmin is standing next to the head of the bank’s board, Tatyana Putintseva. This photo was taken after 2019 when Putintseva became the head of the bank.

That is, there is no doubt that ComInBank is still owned by Evgeny Kazmin, a citizen of the Russian Federation. This is evidenced both by the facts and by the bank employees themselves.

Why was an “empty” bank given 4 billion for refinancing?

ComInBank’s financial situation is deplorable. More than half of the bank’s financial liabilities are due to the National Bank of Ukraine’s refinancing. As of June 1, 2022, ComInBank took 3.88 billion hryvnias refinancing, which will have to be returned at 27% per annum after increasing the National Bank of Ukraine’s discount rate to 25%. And the interest alone is more than a billion hryvnias, which is unaffordable for such a small bank, taking into account that investors do not invest personal money in the financial institution. And it is unlikely that Kazmin’s companies, which hold loans from the bank, will pay them back.

A source in the bank says that in order to improve the financial situation somehow, ComInBank has taken up servicing transporters. In recent years, the financial institution has been used to launder and transfer currency abroad on a particularly large scale. In 2019, the National Bank of Ukraine fined ComInBank for money laundering but imposed a symbolic fine of 200 thousand hryvnias.

Since the full-scale war, money transfer operations in the areas of drug trafficking, gambling, and pornography trade have been conducted through ComInBank, according to a source at the bank. “For this purpose, special people gather “swindlers” from all over the market. They work through all the illegal areas – porn, drugs, online casinos. The bank then conducts payments through P2P transfers. The transaction volumes there are huge, in the billions. And the bank gets a percentage for this,” says the source at the financial institution. The National Bank also turns a blind eye to this.

Over the past two years, 158 criminal cases were initiated and investigated against ComInBank. But there have been no results so far.

At the same time, ComInBank received 695 million hryvnias for refinancing from February to June. Why the National Bank gives funds to a bank on the verge of bankruptcy, involved in many criminal cases, and even with a Russian owner, is another question. It is up to the law enforcement agencies to answer it.

* * *

According to the Association of Ukrainian Banks, up to 20 financial institutions may go bankrupt in the next six months. ComInBank, which under Yevgeny Kazmin’s leadership has become a financial hole and a vehicle for illegal financial transactions, is likely to be among them. Given the name of the real owner of the bank, the National Security and Defense Council of Ukraine should be interested in it. And it is time for the depositors to think about their funds.

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