The Pechersk District Court of Kyiv on Tuesday imposed a pre-trial restraint in the form of detention with the possibility of bail in the amount of UAH 999 million 991 thousand on Viktor Lotous, chairman of the board of Poltava Mining and Processing Plant, which belongs to the Ferrexpo group of companies owned by MP of the VII and VIII convocations Konstantin Zhevago.
According to the website of the Office of the Prosecutor General of Ukraine, without specifying the names of the suspect and the owner of the group of companies, the court made the decision at the request of prosecutors from the Specialized Environmental Prosecutor’s Office.
According to Ferrexpo’s website, Viktor Lotous is the Chairman of the Board of Poltava Mining.
According to the Prosecutor General’s Office, the suspect was taken into custody in the courtroom.
As reported, on September 22, Lotous was served with a notice of suspicion of illegal mining worth over UAH 157 billion. He is charged with illegal mining and abuse of power committed by a group of persons by prior conspiracy (Part 2 of Article 28, Part 4 of Article 240, Part 2 of Article 364-1 of the Criminal Code of Ukraine).
According to the investigation, he, in collusion with other unidentified officials of the mining and processing plant, set up an illegal scheme for the use of minerals. The company, licensed to mine only iron ore, illegally processed and sold other minerals obtained in the course of mining. They processed them and produced crushed stone of three different fractions, which were sold to business entities. Thus, from 2015 to 2021, more than 20 million cubic meters of minerals were illegally extracted, and the amount of damage caused is more than UAH 157 billion.
On January 10, 2023, the State Bureau of Investigation conducted several searches in connection with the investigation of the alleged illegal extraction of minerals and their subsequent sale. The National Police of Ukraine also investigated the same case and conducted searches and took samples from the dumps on January 17. On June 29, 2023, the SBI served suspicion notices to three members of the top management of the Mining and Processing Plant and the head of one of its divisions on suspicion of selling crushed stone without a permit. The employees were detained by the SBI and later released after posting bail totaling UAH 122 million, which was approved by the court.
Ferrexpo’s semi-annual report stated that the company continues to monitor and analyze the situation with the allegations against the company’s management. “The position of the company is that the minerals in question are not a separate mineral resource, but are waste products obtained as a result of crushing iron ore during the technical process of iron ore pellets production,” the report stated.
The report explains that crushed stone sales were controlled by the State Service of Geology and Subsoil of Ukraine for many years and were discontinued by the group in September 2021. “It is the position of the Group that based on the existing mining license, the Group complies with the relevant legislation. The Group continues to monitor and analyze the situation regarding the suspicions announced by the SBI,” the company’s report summarized.
Earlier, the SBI issued a press release claiming that the plant’s executives had illegally seized almost UAH 400 million from the extraction and sale of minerals of national importance without the appropriate permits, and “cash from the sale was withdrawn through conversion centers and distributed among members of the criminal group.” “SBI officers, in cooperation with the SBU and the Prosecutor General’s Office, served suspicion notices to the management of the company: the management of the plant’s board, heads of departments through which the company’s financial transactions were carried out, and the management of the company through which the fraud was carried out,” law enforcement officials said in a statement.
Ferrexpo is an iron ore company with assets in Ukraine, owning a 100% stake in Yeristovo Mining, 99.9% in Bilanivsky Mining and 100% in Poltava Mining.
The National Commission on Securities and Stock Market (NSCM) banned trading in shares of 39 joint-stock companies of public interest, which are located in the controlled territories and have not held annual general meetings of shareholders on the results of 2021 and 2022.
“To prohibit from 00 h. 00 min. 26.09.2023g. trading in shares of joint-stock companies listed in the annex to this decision, namely: the execution by investment firms of transactions with shares of these joint-stock companies, related to the transfer of rights to securities and rights on securities,” – stated in the decision of the NCSSM № 1064 of September 25.
The JSCs included, in particular, “ArcelorMittal Kryvyi Rih” (AMKR), “Kryvyi Rih Iron Ore Combine” (KZhRK), “Kryvbasvzvzryprom”, “Pokrovsky GOK”, “Kremenchug Steel Works”, “Hemoplast, Dniprovsky Iron and Steel Works, Sumykhimprom, Nasosenergomash, Dniproazot, Azot and Rivneazot, Sumy Machine-Building NPO, Dniprotyazhmash, and Odessa Brandy Factory.
They also include Lviv Iskra Electric Lamp Plant, Borschagovsky Chemical and Pharmaceutical Plant (BCPP), Inter TV Channel, Novokramatorsk Machine-Building Plant (NKMZ), and Concern Khlebprom, “Concern Galnaftogaz, Bilotserkivska TPP, Naftogazvydobuvannya, Elba, Prosto-Strakhovanie, IC Vona, IC Omega, Eximnaftoprodukt, Odessnaftoprodukt, and Tatarbunarsk ATP No. 15143.
The list also includes Volynoblenergo and Ternopoloblenergo, as well as seven regional gas companies: Poltava, Vinnytsia, Kirovograd, Rivne, Volyn and Chernivtsygaz.
According to the regulator, the JSCs are in a situation when further circulation of their securities will violate the rights of investors.
National depository of Ukraine, self-regulatory organizations UAIB and PARD, as well as trade organizers are instructed to inform the Commission about the implementation of this decision within three days.
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State-owned Ukrgasbank is launching a lending program for individual entrepreneurs (IEs) under the government’s Affordable Loans 5-7-9% program at 15% per annum without collateral requirements, the financial institution said in a press release on Tuesday.
“We have expanded the opportunities for entrepreneurs to attract financing by adapting our microloan to the Affordable Loans 5-7-9% program. Thanks to this, we can offer financing to individual entrepreneurs at a halved interest rate as opposed to the rate for a standard loan product,” Tetyana Kornienko, Director of Small and Medium Business Department of Ukrgasbank, said in the release.
It is specified that under the terms of the program, individual entrepreneurs can receive loans of up to UAH 1 million to replenish working capital, in particular for the purchase of goods and raw materials, for a period of 1 to 2 years.
It is noted that the bank makes a decision on such loans within one day, after which the credit funds are credited to a virtual card, which customers can use to pay in a retail network or on the Internet.
Ukrgasbank informed that several customers have already taken advantage of the program.
“The first to use the program were entrepreneurs from Lviv and Ivano-Frankivsk, who work in the field of wholesale trade in construction materials. Thanks to the funds raised, they will be able to expand the range of their products,” the statement said.
The state bank considers the requirement of a minimum package of documents, the ability to apply remotely without an in-person visit, the absence of collateral and surety, and a quick decision within 1 day to be its main advantages in microcredit.
As reported, on September 15, the Ukrainian government announced a revision of the terms of the 5-7-9 program, in particular, an increase in the interest rate on working capital loans to 13% per annum.
According to the NBU, Ukrgasbank was ranked 5th among 64 Ukrainian banks in terms of total assets (UAH 167.9 billion) at the beginning of July. Its profit for January-July 2023 amounted to UAH 2.9 billion.
On September 26, Boryspil International Airport (Kyiv) announced a tender for compulsory insurance of drivers against transport accidents.
According to the electronic public procurement system Prozorro, the expected price offer was UAH 43,972 thousand.
Applications for participation in the tender are accepted until October 4.
As reported, the winner of a similar tender a year earlier was Guardian Insurance Company.
Boryspil International Airport accounts for over 68% of Ukraine’s passenger air traffic and is the only Ukrainian airport that serves long-haul flights. More than 50 airlines operate regular flights from the airport to more than 100 routes around the world.
Oil prices continued to decline on Tuesday amid concerns about the global economy and high interest rates in the United States.
November futures for Brent on the London ICE Futures exchange by 14:47 by $0.75 (0.8%) to $92.54 per barrel.
Quotations for November futures for WTI in electronic trading on the New York Mercantile Exchange (NYMEX) by this time decreased by $0.77 (0.86%) to $88.91 per barrel.
Earlier in September, oil prices reached annual highs on the news that Saudi Arabia and Russia were extending voluntary production cuts.
However, last week, the Federal Reserve made it clear that interest rates could be raised again and could remain at high levels for a long time. In this regard, uncertainty about the outlook for oil demand has recently increased.
Meanwhile, “oil supply is expected to lag behind demand for the foreseeable future, and therefore periods of weakness in quotations, even severe weakness, are unlikely to last long,” wrote Tamas Varga, an analyst at PVM Oil Associates.
Douglas Lawler, head of Continental Resources, believes that oil prices could reach $120-150 per barrel, provided that production does not start to grow.
On Tuesday, the American Petroleum Institute (API) will publish data on the weekly dynamics of oil reserves in the country, and on Wednesday, the Ministry of Energy will present official statistics. Traders on average expect a reduction in oil reserves by 1.65 million barrels over the week, according to Trading Economics.
