DPR Connections: The Lux Company and Yanukovych's 'Family'


26th September, 2014: by Sergiy Serbina, The Insider.
Translated & published in full with author permission.

A week ago, Verkhovna Rada adopted a law on the peculiarities of local government in some areas of the Donbas and amnesty for separatists. It was submitted to the parliament and “pushed through” in a dubious way, personally by President Poroshenko.

Approved documents, also known as the law on the special status, was the result of the Minsk protocol on the truce with militants.

Let’s not focus on legal terminology. You can read the documents here and here. It’s worth mentioning, by this law President Poroshenko and the parliament are giving the separatists’ regions exclusive rights creating a dangerous precedent along the way.

But it is important to understand who exactly will rule the Donbas on such super favorable terms - with their own police, prosecutors, courts, and stable budget flows.

The Insider already published the investigation on the links of so called “prime minister of DPR” Aleksandr Zakharchenko, who signed the Minsk protocol for separatists. Earlier this person worked for the entities associated with the businessman Rinat Akhmetov and deputies from the Party of Regions.

On August 8th Zakharchenko became a head of Donetsk’s separatists replacing public relations specialist Mikhail Borodai from Moscow. After a while, a fellow of Borodai, one of the symbols of separatism Igor Strelkov (aka Girkin) left Donetsk. As the law enforcement sources explained, the changes were not accidental. “Orthodox” were replaced with “Donetsk” for the truce talks” - said the source.

But three days prior to the appointment of Zakharchenko in the “Donetsk government,” another unnoticed appointment took place. “DPR” got a new “Minister of Education and Science” – Igor Kostenok.
"Prime DPR" Alexander Zaharchenko (far left) and "Minister of Education DPR" Igor Kostenok (far right). Photo copyright ritmeurasia.org

In Ukrainian media the “DPR Ministry of Education” was remembered by seizure of Donetsk National University. Later, on September 19th, militants closed out the History Department of the Donetsk National University. 
“Donbas News” reported that during the take over the “Minister of Education” declared that the University will become a branch of the Russian State University for the Humanities. Kostenok also was the author of the statement that the Ukrainian language will no longer be required to study in the schools of the Donbass. 

As the Insider found out, a member of the separatist’s government had partnered with people close to Ukraine's richest man and the "Family" of the fled President Viktor Yanukovych.

The Public Administration Theorist


At the beginning of September russian agency “RIA Novosti” published biographical information of the leaders of separatism in Ukraine. Among them was Kostenok’s background. 
“ Igor Kostenok, Minister of Education and Science, since 1994 – Associate Professor, Department of General and Administrative Management of the Donetsk State University of the Management. Since 1996 - board member of the NGO "European choice". Since 2007 - Deputy Director of the State budgeted organization "Eastern Regional Center of Innovation Development." Acting President of the closed corporation "Technology Park “Uglemash." Specialist of the Development of the strategic plans and professional training for local governments. On August 5th 2014 Igor Kostenok appointed as Minister of Education and Science of the DPR. ” 
A more detailed study of Kostenok’s biography has shown that he rose to the rank of Professor of General and Administrative Management in the Donetsk State University of Management. 

Interesting that in May 2013 Kostenok was lecturing students on strategic management along with the player of the Donetsk’s “Shakhtar” (football club, owned by Akhmetov) Dmitry Chigrinskii.
Photo copyright http://dsum.edu.ua/
According to the Vernadsky National Library catalog, same year Kostenok received his Ph.D. in public administration. His thesis, as we can tell was specialized – "Social and cultural components of the state mechanism to facilitate the institutionalization of local government."

An interesting article of Kostenok as of 2013 could be found in the same catalog. In this publication current “Minister of Education of the DPR” present the results of his own social research in the Proletarian and Budennovsk areas of Donetsk.

"The vast majority of respondents are characterized by extraordinary level of passivity and total 
exclusion from public life of the district," - stated one of the current leaders of the "people's militia." But, as it turned out, the theorist of public administration and is no stranger to the business. 

“The Masters of Donbas” 


According to the register of legal entities of Ukraine Kostenko has a share in two LLCs “International Youth Center ’Donbass’” and “Donbass Coal Group”. He is also listed as Acting Director of the closed corporation “Technology Park ‘Uglemash.’”
These "Technopark" Uglemash "
According to the information disclosure system in the stock market SMIDA, 80% of the “Uglemash” shares belonged to the state institutions and companies as of 3rd quarter of 2013, of which two 10% shares of stocks were owned by the PJSC "Druzhkovsky Engineering Works" and PJSC "Donetsk Energozavod."

Both of these companies controlled by businessman Rinat Akhmetov’s Group “Mining Machines”. Also extremely interesting are Kostenok’s partners in companies in which separatist’s
“Minister of Education” is being a co-founder. 

For example, "MMC" Donbass" share also belongs to the Donetsk City Council deputy Ivan Gvetadze. This Donetsk businessman has repeatedly cited in the “competitive bidding news.”
These "MMC" Donbas"
For example, Ivan Gvetadze and his brother Teimuraz own the firm "Urban development". The company in 2010 received contracts to build Information-library Center of Donetsk National Technical University. The project cost the state 79 million hryvnia.

According to the information portal Nashі Groshі brothers Gvetadze are partners with Irina Safiullin (LLC "Triol-Auto") - the wife of former Minister of Youth and Sports Ravil Safiullin. 

In May 2012, Forbes wrote that in the 1990s, Ivan Gvetadze was killed in 1996 with businessman Alexander Shvedchenko who financed the football club "Shakhtar." According to the publication, they offered legendary director of the company "Lux" Ahat Bragin, also known as Alex the Greek, to be the club's boss. 

It is worth noting that in 1994, vice-president of "Shakhtar" was mentioned above Ravil Safiullin. Ahat Bragin was killed in 1995 in an explosion at the stadium of the football club. And in 1996, Rinat Akhmetov became the president of "Shakhtar." 






“Family” and KGB


In the second firm – “Donbas Coal Group” – Kostenok has also strange partners. For example, a co founder of the company is a resident of Donetsk, Anna L. Bondarenko. This woman is also one of the founders of the Donetsk public organizations "For Healthy Country."
These "Donbass koalas groups"

 The INSIDER wrote about this organization in May 2014. It is also listed under Nina Bondarenko and Vadim V. Bondarenko. Nina Bondarenko owns a stake in the firm "PKF" Rekkom ", whose director in 2008, was the self proclaimed "People's Governor” of Donetsk Pavel Gubarev. 

Last Spring this character began East Ukrainian separatism.  And Vadim Bondarenko from August 2011 until the fall of the regime of Viktor Yanukovych headed the Department of Revenue in the Donetsk region. His predecessor was a former minister of revenue and fees, Alexander Klimenko, who is one of the top managers of the “Family” who fled. Moreover, a few days before the start of the bloody events in the city center of Kyiv, which led to the downfall of the regime of Viktor Yanukovych, Bondarenko was appointed as an adviser to the Minister Klimenko.
These NGO "For the health of the country"

Interesting that in 2004 Bondarenko was the Acting Director of the Regional Branch of the Association of Social Support and Protection of former Special Forces professionals of Ukraine “Sodruzhestvo” (“Commonwealth.”) 

This association was created back in the 90s by a group of officers of the former KGB USSR. Until December 2004 the association "Commonwealth" was led by the late General George Kovtun - the first head of the Main Intelligence Directorate of the Security Service of Ukraine. Under Soviet rule, this man held the position of deputy head of the KGB of the USSR.

Now "Sodruzhestvo" is being run by the ex-KGB and SBU officer in Lugansk region, Sergei G. Sinchenko. He was four times the national deputy, in particular from the Communist Party and the Yulia Tymoshenko bloc. 

But Vadim Bondarenko is the leader of another Donetsk public organization - the "European choice". According to his biography in russian mass media, “Minister of Education of the DPR” Kostenok is board member of this organization. 

According to the register of legal entities, in the early 2000s, co-founders of the "European choice" back then were Vadim Bondarenko (ex-tax collector), Igor Kostenok ("Minister of Education DNR") and another Bondarenko - Eduard Nikolaevich.
Alexander Klimenko and Vadim Bondarenko. Photo copyright 62.ua
Last May he was appointed as CEO of then-state-owned firm “Donbassenergo,” and still manages the company as of now. As you know, in the summer of 2013 a 60% stake of the previously state owned power generation company was sold to businessman Igor Humeniuk’s "Energoinvest holding".

It’s worth reminding that in 2000s Igor Humeniuk was a CEO of the known Donetsk closed corporation “ARS” establishment friendly to Rinat Akhmetov’s Group. According to the popular version of the media, the name of "ARS" stands for "Alik, Rinat, Samson." 

The main shareholder of "ARS" is close to Akhmetov deputy from the Party of Regions Sergey Kiy, who is indirectly related to the organizations in which “Prime Minister of DPR” Aleksandr Zaharchenko worked.

But the most interesting thing is that Igor's brother Alexander Humeniuk manages the state organizations "Donetsk Regional Center for Investment and Development." And his deputy there is the "the Minister of Education of the DPR” himself. Kostenok even hit the State Agency  information bulletin for National Projects in March of 2013. In addition, the head of the "DonbasEnergo" Eduard Bondarenko was listed as the director of the Donetsk "Production and transport company ‘Ugoltrans.’" 

According to Forbes, the company was founded by six entrepreneurs from Donetsk and Lugansk regions in 2002. Among them was Vitaly Belyakov, who since 2011 has headed the "Donbas Settlement and Financial Center" (DSFC). “DSFC "controls 5 mining and processing factories in Donbass, which connected with the eldest son of a fled president Oleksandr Yanukovych.

Entities of the "DSFC" supplied the coal, in particular, "DonbassEnergo" was getting government contracts worth billions of hryvnia. Media claimed that the notorious "Copanka (mines) were involved in this scheme that was supposedly controlled by the "Family."

 It is well known that negotiations about the future way of life in Donbass are being conducted with the participation of an existing “PDR Government”. As part of this "government" there are at least two people (Alexander Zaharchenko and Igor Kostenok) having clear links the close circles of the richest man of the country and fled "Family."

With high probability, this same "government" will hold local elections and form a new government in the Donbas, which, according to the law on the special status, can not be re-elected in the next three years. 

These authorities, in particular, will receive a secure cash flow from Kiev for the running and recovery of the region. They will manage this stream. Which means “business as usual.”




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