UKRAINE FILES RICO COMPLAINT IN OREGON
This week, American media reported that the Yanukovych government of Ukraine instituted litigation in the United States and in England claiming that during the tenure of Julia Tymoshenko as Prime Minister, Ukraine was defrauded of nearly 1/2 billion dollars. [LA Times, PR Newswire, WSJ] allegedly, the misappropriation occurred between January of 2008 and January 2010.
In the Oregon case, the Ukrainian government charges that a scheme existed to overcharge Ukraine for vaccine purchases and divert the illegal markups. The complaint describes the wrongful activities as follows;
This action arises from the fraud perpetrated by Defendants Olden Group, LLC ("Olden Group"), a company founded and headquartered in Oregon, and Interfarm, LLC ("lnterfarm"), a Ukrainian company, against the Ukrainian state-owned enterprise Ukrvaktsina. Interfarm and Olden Group conspired to overcharge Ukrvaktsina for millions of dollars in vaccine purchases through acts of fraud, money laundering and other criminal acts. Olden Group and Interfarm carried out their scheme by, among other things, submitting false invoices and customs declaration forms and entering into sham contracts with each other, all for the purpose of deceiving Ukrvaktsina. The Defendants' misconduct is pervasive and ongoing. ……
Plaintiff Ukrvaktsina procures vaccines for the people of Ukraine and distributes vaccines to health clinics, hospitals and the general population in Ukraine. Defendant Olden Group is an import/export company that, among other things, purports to distribute vaccines. Olden Group works with foreign companies, such as Interfarm, to charge illegal mark-ups that were either not authorized by Ukrvaktsina or were authorized unwittingly as the result of fraud.
Read entire Complaint
The Tymoshenko camp has denounced these allegations and any claims of wrongdoing stating that this is a mere smear campaign against her and was initiated for political reasons. They point to the fact that the attorneys on the complaint, Aiken Gump, had represented Ukrainian oligarchs from Yanukovych’s Regions Party in the past. Needless to say, Aiken Gump denies the motivations attributed to it. However this firm does represent Ukrainian and Russian companies and businessmen and one of its specialties is to “clean” the images its clients. See The American Lawyer, October 2009.
It is noteworthy that the complaint was filed little over a month before the October 31st local elections in Ukraine and shortly before Julia Tymoshenko’s visit to the United States later this month. Obviously, this litigation will be a prominent issue in both events. Also, Victor Yanukovych took office in February of this year. The necessary factual investigations which are the basis for the Oregon litigation in all probability required more than nine months to complete. If so, then who initiated the investigation during the presidency of the Yushchenko? Was it a Regions party supporter or a disgruntled Orange Revolution politician? Only time – and the discovery process – will tell!