Kroll confirmed that prior to the nationalization of «PrivatBank» has been the object of large-scale fraud that led to losses of at least $5.5 billion, the press service of the National Bank of Ukraine.
«The results of the independent investigation company Kroll confirmed that the PJSC «PrivatBank» has been the subject of massive and coordinated fraudulent actions, at least within the 10 years before nationalization, which has led to the application of the Bank losses of at least $5.5 billion», – stated in the message.
According to the investigation, there are clear signs that the credit funds of «PrivatBank» was used for the acquisition of assets and business financing in Ukraine and abroad in favor of the former shareholders and groups affiliated with them.
In Kroll came to the conclusion that the mechanisms that were used to disguise the real sources and destination of loans, are characteristic features of the co-ordinated scheme of money laundering.
«The volume of transactions and the speed of their conduct (within a few minutes between operations), the absence of a sound economic connection between the person who repays the loan, and the initial borrower and the widespread use of offshore special purpose companies (SPV) evidence of attempts to conceal the true destination of funds from regulators and other stakeholders,» – said the press service of the NBU.
It is noted that «a Central element of organized fraud with the loan portfolio and the withdrawal was the shadow banking structure» within the PJSC «PrivatBank».
«This secret structure provided payments and facilitated the movement of funds in hundreds credit agreements worth billions of US dollars in the interests of persons connected with the former shareholders and groups affiliated with them. To this shadow banking structure was brought hundreds of workers of PJSC «PrivatBank», – stated in the message.
According to the results of the investigation, the shadow banking structure of the managed corporate loan portfolio of related entities.
«Under her control were given new loans, which are usually used for the repayment of principal and interest on existing loans to related parties (cyclical lending). It provided the implementation of the transaction to conceal the source and true purpose of the loan funds, creating the appearance of a normal, customer-oriented Bank. The Bank attracted funds of Ukrainian and foreign investors to support the scheme of cyclical lending», – said the NBU.
For as long as possible to hide the significant risk incurred when lending to related entities, PJSC «PrivatBank» repeatedly provided false information about their financial condition. For this, the former management of the Bank could systematically falsify financial statements, the report said.
«Before the nationalization in December 2016, more than 95% of the corporate loan portfolio was granted to parties related to former shareholders and groups affiliated with them. At the end of 2016, 75% of the portfolio was consolidated into loans to 36 borrowers, linked to former shareholders and groups affiliated with them. Most of them are not redeemed and are overdue, which led to losses of the Bank at least $5.5 billion», – noted in the national Bank.
The regulator said that the results of the Kroll investigation have confirmed previous findings of the national Bank.
The NBU has expressed readiness to familiarize law enforcement agencies with this information.
According to a government decision of December 18, 2016, the state of 100% became the owner of «PrivatBank».
NBU in July published a report financial audit of «PrivatBank», conducted by Ernst&Young according to which on the eve of the nationalization of the Bank was a financial pyramid.
After that, the ex-Bank owners, as well as associated offshore and individuals have begun to file dozens of lawsuits in the Ukrainian courts in which to appeal against the procedure of nationalization and demand compensation for related financial losses.
NBU: In Kroll confirmed that prior to the nationalization of «PrivatBank» has been the object of large-scale fraud that led to losses of at least $5.5 billion 16.01.2018