Russians are illegally withdrawing their money from Ukraine

At least 621 Ukrainian companies have removed russian owners or ultimate beneficiaries over the past three years. After shedding their russian ties, these businesses have continued to operate in Ukraine.

According to the law, the Ministry of Justice of Ukraine is responsible for monitoring and overseeing registration actions. Opendatabot reached out to the Ministry with a list of these companies to determine whether such changes were legal.

As a result of the inquiry, inspections were conducted on only 10 of the 621 companies. Even in this small sample, violations and illegal registration actions were found in 8 cases.

These businesses include:

• RAVETTI UKRAINE: A company registered at a mass registration address shared with 75 other businesses. Last year, its net profit was 4.7 million UAH. Since the beginning of this year, RAVETTI UKRAINE has won nearly 3 million UAH in tenders from gas companies in Kyiv, Rivne, and Sumy.

• DOMOFON. ENGINEERING. OHORONA: Last year, the company reported a net profit of 3.3 million UAH.

• GESTLIFE TRAVEL: The company’s revenue for the past year was 1.4 million UAH.

• FS MACKENZIE-Ukraine: The company earned a net profit of 515 thousand UAH last year.

• CENTER FOR INVESTMENT AND BUSINESS DEVELOPMENT: The company recorded a net profit of 312 thousand UAH for the past year.

• EKSMO EXCHANGE UKRAINE, now LALANA GROUP: The company faced a loss of 1.6 million UAH last year and has unpaid debts to the state under enforcement proceedings.

• REOSVIT: The company owns the trademark Nadi Renardi and is registered at a mass registration address, shared by 53 other companies.

• NOVAKOM UKRAINE: This company has not filed financial statements since 2020.

Responsibility for illegal re-registrations has fallen on some notaries and state registrars who certified the changes. Typically, these professionals have been temporarily deprived of access to the registries.

In another case involving PALVI TELECOM, a notary referred to a residency permit of a russian national living in Ukraine, which should have been exempt and made the changes legal. However, during the same Ministry of Justice check, no record of such a document was found in the registries. The re-registration was deemed legal, and no violations were identified by the Ministry of Justice. It’s worth noting that in the last two years, following the registration changes, the company has actively participated in and won state tenders, totaling nearly one million UAH in 2023 and already 1.8 million UAH since the beginning of 2024.

Despite the fact that the Ministry of Justice of Ukraine has confirmed violations in several selective inspections, no registration actions have been canceled, and the companies continue to operate.

In response to a request from Opendatabot, the Ministry of Justice of Ukraine commented that registration changes can only be canceled based on a court decision or if a complaint is filed by a person whose rights have been violated within two months from the date the person became aware or could have become aware of the violation of their rights, but no later than one year from the date of the relevant decision, action, or inaction.

However, in the vast majority of cases, more than a year has passed since the re-registration, meaning that the deadlines have been missed. Additionally, there is no specific affected individual regarding the withdrawal of russian capital and the whitewashing of businesses.

“The situation is quite strange right now: Ukraine is demanding that foreign partners block russian assets and transfer these funds to us, while russians are calmly and without consequence withdrawing their capital from Ukraine. This outflow is simply not monitored by government institutions responsible for overseeing registration actions. Even if a private company provides a ready list of potential violators, and government institutions confirm them, nothing happens. The Ministry of Justice cannot rectify these violations due to the passage of time and the absence of an individual who has been harmed.

Which government authority in Ukraine will take control of the re-registration of russian assets and cancel the statutes of limitations on such operations? Who, ultimately, should initiate further proceedings in cases where the state of Ukraine is effectively the harmed party? As long as these questions remain unanswered, russians continue to withdraw their funds, and their businesses continue to profit from Ukrainians and government tenders.”

— comments Oleksiy Ivanikin, founder of Opendatabot.

It should be noted that Opendatabot does not remove the designation of the presence of owners from the russian federation or Belarus in company cards even after their removal. However, businesses that have legally rid themselves of russian connections can publish documents proving this for free on their Opendatabot page through the document publication platform.

It’s worth recalling that at the beginning of the full-scale war, 18,900 companies with owners from the russian federation were recorded.