How Ukraine Lost $24 Million: Sanctioned Businessman’s Assets Go To Private Buyers

More than 1 billion hryvnyas ($24 million) in assets owned by a businessman with Russian citizenship under sanctions eluded Kyiv’s control when they were sold off to private companies in deals that the government did not stop, Schemes, the investigative unit of RFE/RL’s Ukrainian Service, has found.

President Volodymyr Zelenskiy’s government has pledged that assets seized from Russian owners would be used to finance Ukraine’s war-recovery effort, which the World Bank estimates will cost $486 billion.

As of August, Kyiv had confiscated Russian-owned assets worth an estimated 15 billion hryvnyas ($362 million), according to the nonprofit Anti-Corruption Action Center.

In the case of sanctioned Russian-Ukrainian businessman Ihor Naumets and his stone-and-sand mining and manufacturing company, Unigran, the state budget has not benefited, Schemes discovered.

Until the end of 2021, it regularly exported to private and state-run firms in Russia, including a Defense Ministry agency that built facilities in Russian-occupied Crimea and a construction group controlled by Russia’s presidential administration, according to information from ImportGenius, a database of trade transactions.

The Russian government-services portal Gosuslugi and business registries identify Naumets as a Russian citizen. He renewed his Russian passport in March 2014, the month Russia seized Crimea. Prosecutors said that Naumets left Ukraine shortly before Russia’s full-scale invasion in 2022.

Sources with knowledge of the matter told Schemes he traveled to Russia throughout 2022 and 2023.

In a video interview with Schemes, Naumets declined to say whether he had Russian citizenship, and denied any wrongdoing.

But evidence of Russian citizenship and alleged financing of the occupation authorities in Crimea and the Donbas qualified him for sanctions and, potentially, confiscation of his assets.

In June 2022, the Prosecutor-General’s Office and the Security Service of Ukraine (SBU) announced the seizure of over 1 billion hryvnyas ($24 million) in assets belonging to an unnamed Russian citizen, based on its investigation of “the Russian businessman’s” alleged financing of terrorists, tax and land-fee evasion, money laundering, and “illegal activities related to mining.”

The SBU alleged that the Russian citizen illegally mined Ukrainian minerals and sent money from their sales to Russia and to support Russian-occupied Crimea and Russian-controlled parts of the Donbas.

It claimed that he “systematically” supported Russia’s war on Ukraine.

Naumets was not named, and he has not been formally charged or identified as a suspect in any alleged crime. But a photo posted on the Prosecutor-General’s Office website showed a sand truck bearing the Unigran logo.

In May 2023, Zelenskiy imposed sanctions on Naumets; Elena Calpa, a U.K. citizen Ukrainian authorities say is the indirect owner of Unigran; and three Cyprus-based companies linked to Unigran.

With sanctions in place, Naumets, Calpa, and the Cypriot companies lost the right to use and manage their assets.

The Justice Ministry could have petitioned the High Anti-Corruption Court to authorize confiscation of Naumets’ assets but has not. Asked why, the ministry told Schemes it was gathering evidence.

And in October 2023, Serhiy Vovk, a judge on Kyiv’s Pechersk district court, revoked the assets-seizure order for Unigran, concluding that there was no justification for “further interference by the state” in Nauments’ property rights in the matter. Asked to explain his reasoning, Vovk told Schemes to read his decision and contact the court’s press service.

The Prosecutor-General’s Office appealed Vovk’s ruling, but later dropped the appeal.

Unigran’s assets — equipment, buildings, vehicles, land — began to be transferred, through intermediaries and in some cases at minuscule prices, to three Ukrainian companies created late in 2023.

Only one official has been held accountable for the sales — a state registrar who formalized some of the transactions. The Justice Ministry told Schemes it had revoked the registrar’s access to the property registry and was appealing a court decision to restore that access.

“We don’t have a single body [that coordinates sanctions enforcement]. At this moment, there’s no responsibility for violating sanctions, in the sense of circumventing them,” Zelenskiy’s sanctions policy commissioner, Vladyslav Vlasyuk, told RFE/RL. He said a bill criminalizing sanctions evasion could be submitted to parliament soon.

A new corporate flag now flies over Unigran’s former office in the Zhytomyr region. It belongs to Uni Stone Plant, formed about a month after Vovk’s ruling, according to the Ukrainian business database YouControl.

Uni Stone Plant is one of the three purchasers of Unigran’s assets. The others, Uni Lux and Uni Service, were registered on the same day in November 2023.

The three companies’ owners, according to YouControl, are the same: Ukrainian entrepreneur Serhiy Shapran, with 90 percent, and Denmark, an investment fund owned by Shapran, with the other 10 percent.

Since the asset seizure was lifted, the companies have bought numerous former Unigran assets, according to YouControl and tax documents.

The purchases include offices, factories, freight cars, land, entrance gates, dump trucks, excavators, and even screwdrivers acquired from firms that had bought them at reduced prices days earlier.

Naumets, who said he now lives in the U.K., described himself to Schemes as the victim of a raid targeting Unigran’s assets and mineral-extraction permits, and claimed it was “probably planned” by Shapran, whom he blamed for “all these criminal proceedings.”

Shapran is the multimillionaire owner of the Brovary Aluminum Plant, outside Kyiv, and the former local head of a party backed by billionaire businessman Ihor Kolomoyskiy.

Naumets showed Schemes an excerpt from what he said was a memorandum he signed with Shapran in September 2023 that obliged Shapran to help with his legal troubles in exchange for a 50-percent stake in Unigran.

In a phone interview attended by his lawyer, Shapran denied he had signed a memorandum with Naumets, discussed such a deal, or taken part in a corporate raid or “any illegal activity.”

Shapran implied that his signature on the document Naumets showed had been forged and urged Schemes to analyze it. A comparison with his signature on multiple official documents showed that they appeared similar.

Adapted from the original Schemes report by Elizabeth Owen