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Ukraine seeks to add billionaire CEO to international wanted list

10th October 2019

By: Bloomberg

  

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KYIV – Ukrainian investigators have started a process to add Kostyantin Zhevago, the billionaire chief of Ferrexpo, to an international wanted list after he failed to appear for questioning about his former banking business last month.

The businessman was named as a suspect in absentia and investigators have begun court proceedings to find him, according to a broadcast of a press conference held by Roman Truba, the head of Ukraine’s State Bureau of Investigations in Kyiv on Wednesday. The investigators will also push for similar measures abroad at a later stage, he said.

A spokesman for Ferrexpo reiterated that Zhevago hasn’t received a notice of suspicion. Zhevago has denied any allegations of wrongdoing, according to a statement released by the company last week. Zhevago’s lawyer didn’t respond to calls and emails seeking comment.

Ferrexpo, which mines for iron-ore in central Ukraine, dropped as much as 3.5% on Thursday, reaching a one-year low.

Barclays downgraded its recommendation on the stock to underweight, citing a bearish view on iron ore and “escalating corruption risks in Ukraine". Ferrexpo is down more than 50% since a peak in mid-April.

Ukrainian authorities have said they suspect Zhevago of large-scale money laundering and embezzling funds from Ukrainian lender Finance & Credit JSC, which he formerly owned.

The company was declared insolvent by the central bank in 2015, and an investigation established that 2.5-billion hryvnia was siphoned off from the bank and transferred to foreign companies owned by Zhevago, according to the State Bureau of Investigations. Two executives from Finance & Credit have been indicted. Last week, a Ukrainian court ruled that Zhevago must pay 1.5-billion hryvnia to the central bank to compensate for refinancing received in 2015.

Edited by Bloomberg

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