Fir­tash’s de­fense al­leges that US prose­cu­tors used false ev­i­dence in seek­ing oli­garch’s ex­tra­di­tion

Kyiv Post - - Business - BY MATTHEW KUPFER [email protected]

The saga has lasted nearly five years. Since 2014, the United States has been try­ing to ex­tra­dite Ukrainian oli­garch Dmytro Fir­tash to Chicago to stand trial on cor­rup­tion charges. The case has slowly wended its way through the Aus­trian court sys­tem.

But now, as Fir­tash awaits a rul­ing by the Aus­trian Supreme Court, an ex­plo­sive New York Times ar­ti­cle has shed rare light on the Amer­i­can ev­i­dence. This has led Fir­tash’s de­fense to al­lege that U.S. prose­cu­tors have ef­fec­tively used false ev­i­dence of wrong­do­ing against their client.

And Aus­trian lawyers say the lat­est de­vel­op­ments could in­flu­ence the rul­ing.

A sin­gle slide

The de­fense’s ac­cu­sa­tion comes after a Dec. 30 ar­ti­cle by The New York Times re­vealed the ex­is­tence of a Pow­er­Point slide dat­ing back to 2006 that sup­pos­edly out­lined a pro­posal by a for­eign part­ner­ship fi­nanced by Fir­tash to gain the right to mine alu­minum in In­dia.

That slide sug­gested that Fir­tash’s com­pany, Bothli Trade A. G., had plans to curry fa­vor with In­dian of­fi­cials by in­vest­ing in in­fra­struc­ture and em­ploy­ment in the Andhra Pradesh state and “re­spect­ing tra­di­tional bu­reau­cratic process in­clud­ing use of bribes.”

The Times said that the slide was part of a due dili­gence re­port pre­pared by con­sult­ing firm McKin­sey & Com­pany for the avi­a­tion com­pany Boe­ing, which sought a new source of the metal to pro­duce its new­est jet air­liner.

But there may be a prob­lem: prose­cu­tors in Chicago pre­sented the slide to the Aus­trian le­gal sys­tem as “clear proof” of the oli­garch’s guilt. But it was not pre­pared by him or his as­so­ci­ates, Fir­tash spokesper­son Lanny Davis told jour­nal­ists dur­ing a Jan. 8 tele­phone press con­fer­ence.

Mean­while, in the wake of the Times’ ar­ti­cle, McKin­sey con­firmed that its em­ploy­ees au­thored the slide — and that the firm “has not served Fir­tash.”

The slide was an ap­pen­dix to a 35-page doc­u­ment pro­vid­ing back­ground on Fir­tash’s com­pany and its op­er­a­tions and rec­om­mend­ing fur­ther due dili­gence. That re­port in no way en­dorsed bribery as a busi­ness strat­egy, McKin­sey said in a Dec. 31 state­ment on its web­site.

“The text was an ill-ad­vised way for the au­thors to de­scribe what they mis­tak­enly un­der­stood to be gen­eral mar­ket con­di­tions and should never have been used,” the firm said.

Road to ex­tra­di­tion

That ad­mis­sion could have ram­i­fi­ca­tions for Fir­tash’s case. The oli­garch has been en­tan­gled in two ex­tra­di­tion cases — one to the United States and one to Spain, both re­lated to al­leged il­le­gal fi­nan­cial op­er­a­tions.

In the U.S. case, prose­cu­tors in Chicago in­dicted him in 2014 as the mas­ter­mind of a scheme to pay $18.5 mil­lion in bribes to In­dian of­fi­cials. After be­ing ar­rested in March 2014, Fir­tash was re­leased upon pay­ing $174 mil­lion in bail. Since then, he has lived un­der house ar­rest in Vi­enna, while his busi­nesses in Ukraine are still op­er­at­ing.

Five months later, Amer­i­can prose­cu­tors sent the Pow­er­Point slide — which they re­ferred to as “Ex­hibit A” — to the Aus­trian Min­istry of Jus­tice, the New York Times re­ported. The doc­u­ment ap­peared to be a break­through for the pros­e­cu­tion. An Aus­trian judge, Christoph Bauer, had found the case against Fir­tash weak.

Bauer ul­ti­mately de­nied the ex­tra­di­tion re­quest, con­cerned that the United States’ de­sire to ex­tra­dite Fir­tash was con­nected to po­lit­i­cal events in Ukraine. Fir­tash is one of Ukraine’s wealth­i­est and most con­tro­ver­sial oli­garchs, with sig­nif­i­cant hold­ings in nat­u­ral gas, fer­til­izer, and the me­dia.

He was re­port­edly close to two Ukrainian pres­i­dents: Vik­tor Yushchenko, who served from 2005 un­til 2010, and Vik­tor Yanukovych, who served from 2010 un­til he was driven from power in the 2014 Euro­Maidan Rev­o­lu­tion. U.S. prose­cu­tors also al­lege that Fir­tash is a lead­ing mem­ber of the Rus­sian mafia. Fir­tash spokesper­son Davis de­nies that charge, call­ing it “ut­terly false” and not­ing that it was not in­cluded in the pub­lic in­dict­ment.

From Bauer’s point of view, U.S. in­ter­est in ar­rest­ing and ex­tra­dit­ing the oli­garch had waxed and waned as Yanukovych vac­il­lated be­tween sign­ing an eco­nomic and po­lit­i­cal as­so­ci­a­tion agree­ment with the Euro­pean Union and a dif­fer­ent agree­ment with Rus­sia in 2013 and 2014. Yanukovych's re­fusal to sign the EU agree­ment helped trig­ger the rev­o­lu­tion that ousted him.

After Bauer de­clined the ex­tra­di­tion re­quest, the U.S. won an ap­peal. Now, the Aus­trian Supreme Court must rule.

Mean­while, the Pow­er­Point slide re­mains a key piece of U.S. ev­i­dence.

“This is our first time of know­ing what’s be­hind the cur­tain of what the Chicago prose­cu­tors have,” Davis said. “Not one word in that in­dict­ment al­leges that Fir­tash or any­one else ac­tu­ally paid a bribe; it’s all about a ‘scheme,’" Davis added.

He sug­gested that prose­cu­tors may have mis­taken the Pow­er­Point slide for a doc­u­ment com­posed by Fir­tash and his as­so­ci­ates. But in light of the Times’ ar­ti­cle and McKin­sey’s state­ment, Davis says that the U.S. gov­ern­ment must ad­mit its mis­take.

Due to the cur­rent U.S. gov­ern­ment shut­down, nei­ther the U. S. De­part­ment of Jus­tice nor U.S. state at­tor­neys in Illi­nois could be reached for com­ment.

Aus­trian jus­tice

It re­mains un­clear when the Aus­trian Supreme Court will rule. But the lat­est rev­e­la­tions could prove im­por­tant, say two Aus­trian lawyers knowl­edge­able in ex­tra­di­tion cases. Nei­ther has any di­rect re­la­tion to the Fir­tash case.

After the Aus­trian ap­peals court ruled that Fir­tash could be ex­tra­dited, the oli­garch’s de­fense team filed an ex­tra­or­di­nary ap­peal to the Supreme Court. To file such a case, a de­fen­dant must ar­gue that one of his or her el­e­man­tary rights were vi­o­lated, says Niko­laus Loudon, a se­nior as­so­ciate at Aus­tria’s Wolf Theiss law firm.

Since the court of first in­stance de­nied ex­tra­di­tion on the grounds that it be­lieved the case against Fir­tash was po­lit­i­cally mo­ti­vated, Loudon be­lieves that Fir­tash’s lawyers may have used this ar­gu­ment in fil­ing the ap­peal to the Supreme Court.

If the Aus­trian courts be­lieve that the Pow­er­Point slide is not a cor­rect piece of ev­i­dence, “this might be a vi­o­la­tion of a fair trial in the Aus­trian ex­tra­di­tion pro­ceed­ings,” Loudon told the Kyiv Post. “But, in par­tic­u­lar, it could also be raised as an ar­gu­ment that (Fir­tash) can­not ex­pect a fair trial in the United States.”

That could be grounds for not grant­ing ex­tra­di­tion.

But Matthias Cer­nusca, an at­tor­ney at Lan­sky, Ganzger & Part­ner law firm, says it is dif­fi­cult to fore­cast how the Pow­er­Point slide could in­flu­ence the Supreme Court de­ci­sion. It could al­low Fir­tash to file for a re­trial, even if the Supreme Court goes against him.

“It’s some­thing that might have an im­pact on the de­ci­sion (of whether) ex­tra­di­tion is granted or not,” says Cer­nusca. “So that could be grounds to file for re­trial.”

Dmytro Fir­tash (L), one of Ukraine’s most in­flu­en­tial and con­tro­ver­sial oli­garchs, at­tends a court hear­ing on April 30, 2015 in Vi­enna. (AFP)

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