Andriy Stavnitser’s TIS-hell

Quarter of a Century in Murky Waters: From Ukrainian Independence to Russian Subordination.

In September, the country’s largest private port celebrated its 25th anniversary. Can «TIS» be considered a domestic company if on paper it is owned by a Ukrainian businessman, but in fact, it is controlled by a Russian oligarch?

Nominally, the company is owned by two groups of shareholders: the top management of «TIS», represented by CEO Andriy Stavnitser, his brother Yehor Hrebennikov, and the head of the legal department Oleh Kutateladze, control about 51% of the company, while the remaining 49% is with the scandalous Russian businessman Oleksiy Fedorychev, who was included in the sanctions list of the National Security and Defence Council of Ukraine in the spring of this year.

Fedorychev began acquiring assets of «TIS» back in 2008 and officially owns two terminals: «TIS-Grain» and «TIS-Mineral Fertilizers», and is supposedly a co-investor in others. However, media have repeatedly published facts that in recent years the Russian oligarch has become the full owner of Ukraine’s largest port.

Who is Oleksiy Fedorychev?

The Russian oligarch has a rich criminal history: in 1997, he was suspected by the police of Monaco and France of laundering criminal funds, arms dealing, and drug trafficking, and in 2012, his personal plane was detained in the Canary Islands with 1988 kg of cocaine on board.

Members of the Lyuberetsk organized crime group and other figures in high-profile criminal cases from Russia were frequently seen in his circle, and in Ukraine, he was noted for his connections with Yanukovych’s “grey cardinal” Yura Yenakiyevskyi, thanks to whom he transferred huge sums to his personal accounts.

Fedorychev is an ardent fan of luxury, and a bohemian lifestyle is the norm for him: previously, he rented vessels at a weekly cost of over $600,000, and in 2018 acquired his own 111-meter elite yacht for 220 million euros, named TIS in honor of the Ukrainian company group through which he laundered considerable funds.

In 2017, the capital’s court arrested Fedorychev’s share in «TIS», and in 2018, NABU announced him in a nationwide search on suspicion of organizing a fraud scheme to create a $60 million debt to the "State Food and Grain Corporation of Ukraine." One of the debtors is LIRTAVIS Enterprises, a shell company controlled by Fedorychev, registered in Cyprus.

Since February 2018, the oligarch is on Interpol’s blue list (when crossing borders, he is issued a Blue Notice—a notice of tracking movements). Law enforcers have submitted a request to Interpol for the arrest and deportation of Fedorychev to Ukraine for investigation and trial.

What does Stavnitser have to do with it?

The young businessman is one of the richest residents of the Odesa region, with an estimated wealth of $50 million. Is it a coincidence that at the same time Stavnitser is involved in a series of the below-mentioned Fedorychev schemes regarding the embezzlement of funds from the Ukrainian budget?

The Scheme with «Ukrzaliznytsia»

This involves a conspiracy of «Ukrzaliznytsia» officials and the company’s management to develop the so-called station “Chornomorska-TIS,” during which the management of «Odesa Railways», to the detriment of the state, refused to receive $2.5 per ton from «TIS» for services of wagon submission and removal. Thus, funds that should have gone to the state budget were received by the private company «Chornomorska-TIS», founded by Fedorychev. As a result, the domestic budget did not receive about 60 million hryvnias for the year, and over ten years—more than half a billion.

MP Vitaliy Kupriy noted that this large-scale corruption scheme involved former Deputy Director of «Ukrzaliznytsia» Viktor Chornyi, former head of Odesa Railways Ilya Levytskyi, and «TIS» CEO Andriy Stavnitser.

The Scheme with the Ministry of Infrastructure

In 2016, the company «P&O Maritime» approached the Minister of Infrastructure Volodymyr Omelyan with a proposal to buy tugs from the Odesa port, which were supposedly being used inefficiently there. The cost of 12 tugs was estimated at $50 million, with the buyer according to the contract immediately paying only 50%, and the remaining $25 million over 10 years.

However, a simple calculation shows that selling the tugs for $50 million with payment installments over 10 years would have caused Odesa port a loss of 4 billion hryvnias. The "inefficient" tugs could generate $17 million in just one year, and Odesa port would have earned the proposed $50 million in 3 years, and over 10 years, this amount would have tripled.

According to media reports, this is the largest scheme in Ukrainian ports since the division of the CMP fleet, and the initiator of the deal was TIS CEO Andriy Stavnitser, who officially represented P&O Maritime’s side, including at meetings in the ministry.

Since these tugs, like any other property of state ports, cannot be alienated, Omelyan began lobbying to lift this moratorium under the guise of attracting investments into Ukraine.

Funds for the purchase were supposed to go through Stavnitser’s “investment fund” SD Capital, where some of them would have stayed. Thus, the Ministry of Infrastructure expected to "thank" Stavnitser for mediating the deal. However, a serious scandal erupted in the country regarding the sale of state property, so it was not possible to hand over the tugs for almost nothing.

There was another reason for the TIS CEO’s involvement in the deal—to bankrupt his competitor—Odesa Sea Port. It did not matter that the state would lose tens of millions of hryvnias because of this. Instead, his own company would remain in profit.

The Scheme with Ship Collection

In 2016, negotiator Vitaliy Kupriy handed over documents to law enforcement agencies indicating that TIS had captured 132 hectares of land in the Lyman district of Odesa region.

In the same year, 2016, SSU employees raided the offices and residential buildings of the TIS top management. Andriy Stavnitser was suspected of embezzling $6 million.

According to an official statement by the SSU press service, "in 2015, a company owned by a well-known Russian businessman, which owns the terminal, illegally obtained rights to receive part of the funds from port dues that had previously been received by SE ’Ukrainian Sea Ports Authority.’ This became possible through the illegal registration of property rights to part of the water area of the Adzhalykskyi Liman, which, according to the Constitution, is the property of the Ukrainian people."

During searches, the security service operatives already seized a lot of unaccounted currency and also stamps of offshore companies. Additionally, the distribution of shipping dues at the Yuzhnyi port suggests that «TIS» representatives are lobbying to obtain a 50% discount on tariffs for the transit of iron ore raw materials from the aggressor country during their transportation to «TIS» terminals.

What’s the Outcome?

All these facts were laid out by members of the inter-factional parliamentary association "Parliamentary Control" to the Austrian Ambassador to Ukraine, Hermine Poppeller, and the Minister of Foreign Affairs, demanding that Andriy Stavnitser be deprived of the title of Honorary Consul of Austria.

Interestingly, this is not the first scandal involving the Honorary Consul of Austria in Odesa—Stavnitser’s remarks regarding the American President once threatened to escalate into a real diplomatic crisis. Playing on a Ukrainian political joke about former President Yanukovych, he wrote: "Thanks to the residents of Texas for the president... Donald Trump."

Now, in the deputies’ opinion, the TIS CEO’s activities have caused financial damage to Ukraine. After this statement, two of these MPs were attacked: Vadym Rudenko’s car was burned, and Ihor Kotvitskyi’s house was fired at with a grenade launcher.

«I believe that Andriy Stavnitser, head of TIS, may be involved in these actions. There are all grounds to suspect him since we have been monitoring his company’s work for a long time and have repeatedly reported on corrupt schemes in Ukrainian ports», said a member of the "Parliamentary Control", MP Maksym Polyakov.

This is an unprecedented case in two years of operation of the anti-corruption association, when its members are directly threatened with physical violence. There is also pressure on journalists collaborating with "Depcontrol" to cover the topic of corruption and establish that the inaccessibility and inviolability of the Honorary Consul of Austria’s office in Odesa, Andriy Stavnitser, is directly used by the organized crime group "TIS-FEDKOMINVEST" for storing black funds, black accounting, and documentation.

His majority partner Fedorychev, in turn, provided an endless supply of "black cash dollars" for the corrupt needs of «TIS» with the help of Bank «Pivdennyi», with which he has long-established a laundering scheme through their Latvian subsidiary company «RIB», where the Russian oligarch and enterprises «TIS-Grain» and «TIS-Mineral Fertilizers» are long-time clients for implementing schemes to minimize taxable income in Ukraine and to transfer profits to offshore accounts.