Ukrainian President Petro Poroshenko kept the country in suspense over the details of his nearly billion-dollar fortune, submitting his electronic declaration of assets on the evening of Oct. 30 just two hours before the deadline.
Poroshenko declared that he made Hr 49.6 million (nearly $2 million) in 2015, almost all of it coming from the state bonds’ payments and investment income from the companies he owns. There are over 100 of them, including the ones registered in offshore jurisdictions. His yearly salary as president was just Hr 121,054 or $4,730.
The president owns a large house, several apartments and land plots, a couple of cars, an art collection, and a number of luxury items, such as furniture, designer bags, and jewelry.
While Poroshenko keeps more than $26 million in his bank accounts in Ukraine, he also has some $95,000 in handy cash, part of it in hryvnia.
Poroshenko also declared an offshore company that was in the center of the Panama Papers leak earlier in 2016, reviving allegations that the president planned to avoid taxes.
Real estate, art
Poroshenko declared a house in Kozyn, a town 25 kilometers south of Kyiv, where he lives with his wife and children, and which occupies a total of 1,331.7 square meters on a land plot of 33,196 square meters, along with two other land plots in Kozyn of a total of 8,711 square meters, and three land plots in Kyiv with a total area of 12,484 square meters.
The addresses of the land plots aren’t listed, but one of them, of 6,315 square meters, seems to be the plot that Poroshenko owns in the most prestigious area of Kyiv – the hills near Kyiv-Pechersk Lavra, known among the Kyivans as Tsarske Selo (A Village of Tsars).
He also declared two apartments in Kyiv of 82 and 134 square meters, an apartment in Vinnytsya 68.2 meters in area, and the Lebid (Swan) recreation center in Odesa Oblast.
Poroshenko’s wife Maryna owns an 80-square-meter apartment in Kyiv, a land plot of 1,900 square meters with a summer house in Petropavlivske, and a garage in Kyiv.
Poroshenko owns a 2010 Mercedes-Benz Vito 116 CDI and rents a 2011 BMW F02/750Li xDrive, a 2011 Range Rover Sallmam, and a Bayliner boat. The first lady owns a 2008 Jaguar XF 4/2 Lv8.
Poroshenko, who appears to be an art lover, declared three collections of paintings: One of them consists of 65 paintings by Russian and Ukrainian painters of the 19-20th centuries, a collection of 15 paintings by “Old Masters” and a collection of four pictures by modern impressionists and surrealists. He also has a collection of six sculptures from the 19-20th century, and a sculpture by Italian artist Guglielmo Pugi: “Boy Fishermen.”
Apart from real estate and cars, Poroshenko also declared two mink coats, a sable coat, leather coats, women’s leather bags by Fendi, Dior and Chanel, and several jewelry sets. Poroshenko also owns four luxury wristwatches by Breguet, Patek Phillip and Hublot.
Money man
Poroshenko declared Hr 49,665,361 in total investment income, and ownership of more than 100 companies in Ukraine, Russia, Poland, Spain, China, Cyprus, the British Virgin Islands and the Netherlands.
While Poroshenko’s official salary is just Hr 121,054, he also declared Hr 540,478, $26,324,870 and 14,372 euros in bank accounts at the International Investment Bank, where he owns a 60-percent stake. Poroshenko also has $60,000 and Hr 900,000 in cash.
“It is my principle to keep money in the bank. Public officials should give an example of trusting the banks,” Poroshenko said about his declaration, alluding to the large amounts of cash – sometimes millions of dollars – declared by many politicians.
Links to Panama Scandal
The list of companies declared by Poroshenko includes Prime Asset Partners Limited, a company registered in the British Virgin Islands that came to light in the Panama Papers leak, and was documented in a program aired by Ukraine’s Hromadske TV channel on April 3.
Prime Asset Partners Limited owns the Cyprus-based CEE Confectionery Investments Limited, which owns Roshen Europe BV, founded in the Netherlands. Roshen confectionary company is Poroshenko’s biggest asset, valued by the president himself at about $3 billion in 2014, according to a Bloomberg report that quoted Roshen CEO Vyacheslav Moskalevsky.
Dmytro Gnap, one of the journalists who worked on the Panama Papers story, said on Oct. 31 that Poroshenko may have indirectly proved that he created offshore companies to sell his confectionary corporation Roshen with minimal taxes. Poroshenko wrote on his Facebook page on the evening of Oct. 30 that “since 2014, only one company that I own directly was created, and it was done to sell Roshen.”
Gnap said that with this statement, Poroshenko had contradicted his earlier claim that he had created the company in the British Virgin Islands not to sell the company, but to transfer it to a blind trust.
Poroshenko said at a press conference on Jan. 14 that he had transferred his stake in Roshen to a blind trust, and that he no longer had any influence on the company. After journalists published their Panama Papers investigation in April, Poroshenko said at a news conference in Tokyo, Japan that the sole purpose of the offshore companies was to transfer his assets to a bank with a good reputation in order to manage his blind trust.
However, Gnap argued that if Poroshenko had said he created Prime Asset Partners Limited to sell Roshen, it would be obvious that he wanted to minimize taxes. After taking office in 2014, Poroshenko said that he had hired two investment firms, Rothschild and ICU, to sell his stake in Roshen, but they had failed to find buyers. Bloomberg news agency reported on May 8 that Nestle SA was interested in buying Roshen, but had refused to pay more than $1 billion – a third of the value of the company estimated by investment firms.
Avellum law firm, which represents Poroshenko, told Hromadske on April 4 that even after the president transferred his stake to his offshore company, all the taxes from Roshen’s income would have to be paid in Ukraine in accordance with the law.
But Inna Rudnyk, a lawyer at the Alekseev, Boyarchukov and Partners law firm told the Kyiv Post on Oct. 31 that creating a blind trust and selling Roshen could be done sequentially.
“We cannot say that these two statements (by Poroshenko) are contradictory, as his investment firms noted from the beginning that the creation of an offshore company would increase the investment attractiveness of the Roshen group, if it’s up for sale,” Rudnyk said.
Maryna Karliuk, a lawyer from the Jurimex Law Firm, also said that the transfer of assets to a blind trust would not exclude the possibility of its later being sold by the managers.
A possible mistake
Ukrainian lawmaker with the president’s bloc, Sergii Leshchenko, claimed on Oct. 31 that Poroshenko had entered incomplete data in his declaration.
Leshchenko said that Poroshenko didn’t specify which paintings he possessed, instead declaring them as three collections that have 84 paintings in total.
The law demands that the movable items that cost more than 100 minimum wages, or Hr 121,800, are declared individually unless they were purchased as a set.
Leshchenko claims that Poroshenko owns paintings of the Early Renaissance artist Sandro Botticelli, Flemish Baroque painter Peter Paul Rubens, Russian realist Ilya Repin, and marine artist Ivan Aivazovsky, which Poroshenko had to declare individually.
According to Ukrainian law, officials have seven days to make corrections to their declarations.
