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A U.S. Indictment Draws Ukraine Further Into Washington's Impeachment Drama

Lev Parnas (left) and Igor Fruman are associated with President Donald Trump's personal lawyer, Rudy Giuliani. (combo photo)
Lev Parnas (left) and Igor Fruman are associated with President Donald Trump's personal lawyer, Rudy Giuliani. (combo photo)

KYIV -- In April, two ambitious, politically connected U.S.-based businessmen traveled to Israel to meet with Ihor Kolomoyskiy, one of Ukraine's wealthiest tycoons and a man some consider to be a consigliere to newly elected Ukrainian President Volodymyr Zelenskiy.

Lev Parnas, who was born in Soviet Ukraine, and Igor Fruman, who was born in Soviet Belarus, were trying to develop a natural-gas trading company that potentially would involve Ukraine. They also wanted an "in" with Zelenskiy.

The two bragged that they were tight with Rudy Giuliani, President Donald Trump's personal lawyer, Kolomoyskiy said, as well as Ukraine's then-prosecutor-general, Yuriy Lutsenko.

And then, Kolomoyskiy said, he kicked them out of his office.

"There are two scams under investigation by the United States," Kolomoyskiy told Schemes, an investigative project of RFE/RL's Ukrainian Service, in an interview on May 17. "And they go here to Ukraine, they collect money from people, they tell them that they are close to Mr. Giuliani, and that they will resolve any question with Mr. Lutsenko. Mr. Lutsenko does not even know it. And, I think Mr. Giuliani doesn't know about that, either."

In a reference to a fictional scam artist in two famous Soviet novels, he called Parnas and Fruman "two Ostap Benders who walk between two countries and talk in every possible way."

On October 9, at around 6 p.m., Parnas and Fruman were arrested by federal law enforcement agents at Dulles International Airport outside Washington, D.C., carrying one-way tickets to Frankfurt, Germany. News reports said they were on the glass-enclosed gangway to the plane when plainclothes agents stopped them, turned them around, and escorted them into custody.

U.S. authorities have charged Parnas and Fruman with violating U.S. campaign-finance laws, saying they used a Florida-registered energy company to illegally funnel campaign contributions from foreign sources to U.S. political candidates.

But the U.S. court papers also hint at a bigger web of connections that add yet more Ukrainian elements to the congressional impeachment inquiry that is engulfing the Trump administration, an inquiry that was sparked initially by Ukrainian connections.

A Facebook screen shot provided by the Campaign Legal Center shows from left to right: Donald Trump Jr, Tommy Hicks Jr, Lev Parnas, and Igor Fruman in May 2018.
A Facebook screen shot provided by the Campaign Legal Center shows from left to right: Donald Trump Jr, Tommy Hicks Jr, Lev Parnas, and Igor Fruman in May 2018.

In their first court appearance, on October 10, neither Parnas nor Fruman entered a plea. Prosecutors told the court they were a flight risk; a judge ordered them held on $1 million bail. Three other men have also been charged in the case, including a Ukrainian citizen, Andrei Kukushkin.

Campaign Donations

According to the indictment, Parnas and Fruman set up a company called Global Energy Products that they used to funnel $325,000 to a Trump fund-raising committee in 2018.

Prosecutors said the two, along with Kukushkin and two others, also sought to donate funds to state elections, including in Nevada.

Parnas also donated $100,000 to Trump during the 2016 election campaign, Federal Election Commission records show.

But the court papers also state that Parnas and Fruman donated, and promised to raise more money, to benefit a congressman who was involved in the effort to recall the U.S. ambassador to Ukraine, Marie Yovanovitch.

Yovanovitch was the focus of intense criticism from Trump allies, who complained that she was hindering efforts to reopen an investigation into the Ukrainian energy company Burisma Holdings.

Hunter Biden -- the son of Joe Biden, the former U.S. vice president and potentially Trump's chief rival in the 2020 presidential election -- was on Burisma's board of directors. He reportedly received $50,000 a month to be a consultant and a member on the board, which he said ended in May.

Trump and his allies assert that Joe Biden forced the 2016 resignation of Prosecutor-General Viktor Shokin as an effort to quash any investigation into Burisma. Biden, who has repeatedly denied he had any such motive, was one of several U.S. and Western officials who at the time had complained that Shokin was doing little to prosecute major corruption cases.

Trump-Zelenskiy Call

The issue of investigating Biden came up on July 25, when Trump spoke by phone with Zelenskiy. According to a memorandum of the conversation that was released by the White House, Trump suggested that Zelenskiy should push for new investigations, including into Biden.

Trump raised the issue of the investigation immediately after Zelenskiy mentioned Ukraine's need for more U.S. military aid. The call came only days after Trump reportedly blocked $391 million in military aid to Ukraine.

That, along with a whistle-blower complaint that alleged Trump may have been seeking what amounted to a foreign campaign contribution, has led to the U.S. House of Representatives opening an impeachment inquiry of Trump.

Trump and the White House have strenuously denied the allegations of impropriety and have lashed out at Democratic-led House committees that are leading the impeachment inquiry, calling it a "total hoax."

In the phone call with Zelenskiy, Trump also criticized Yovanovitch, who was prematurely recalled as ambassador in Kyiv two months earlier, in May. He called her "bad news."

According to the U.S. indictment, Parnas and Fruman were directly involved in the behind-the-scenes effort to recall Yovanovitch from Kyiv.

"Parnas's efforts to remove the ambassador were conducted, at least in part, at the request of one or more Ukrainian government officials," the indictment said.

The Ukrainian government official or officials were not named in the indictment. But one of the chief critics of Yovanovitch at the time detailed in the indictment was Lutsenko, who succeeded Shokin as prosecutor-general and was pushed out of the post by Zelenskiy in August.

A spokeswoman for Lutsenko did not answer repeated phone calls from RFE/RL seeking comment.

Giuliani, a former U.S. federal prosecutor and former New York mayor, has no formal position in the Trump administration. But critics charge that he has been conducting a shadow foreign-policy campaign on Trump's behalf, and he was outspokenly critical of Yovanovitch.

Parnas played an active part in the flurry of negotiations between U.S. diplomats and Ukrainian officials surrounding the July 25 Trump-Zelenskiy phone call.

Six days before the call, Parnas attended a breakfast meeting in Washington, D.C., with Giuliani and the U.S. special envoy to Ukraine, Kurt Volker.

"We had a long conversation about Ukraine. To my surprise, Mr. Giuliani had already come to the conclusion on his own that Mr. Lutsenko was not credible and acting in a self-serving capacity," Volker, who resigned abruptly last month, told the House committees investigating Trump.

Gas Dealings

Within Ukraine, neither Parnas nor Fruman is widely known in business or government circles. Fruman is a part-owner of a beachfront nightclub in the Black Sea port of Odesa; the club is called Mafia Rave.

Records show that the company they registered in Delaware, Global Energy Producers LLC, was set up to deliver U.S. liquefied natural gas to Ukraine.

In a text message exchange with Schemes on October 9, prior to his arrest, Parnas said that he and Fruman had been in negotiations to sell U.S. gas to Ukraine.

However, he denied that as part of that effort they had sought to replace the chief executive of Ukraine's powerful state-owned natural-gas company, Naftogaz.

Hours after the indictment was unsealed, congressional investigators in the impeachment inquiry announced they had demanded that Parnas and Fruman turn over documents related to allegations they sought to restructure.

Late on October 9, Trump was asked about his relationship with Parnas or Fruman. "I don't know those gentlemen," Trump said. "Now it's possible I have a picture with them because I have a picture with everybody. I don't know about them. I don't know what they do. I don't know, maybe they were clients of Rudy. You'd have to ask Rudy."

Ukrainian-American businessman Lev Parnas (left) is seen in a 2018 social-media post appearing to show him at the White House with President Donald Trump in a screen capture from his social media account made in 2018 by the Campaign Legal Center.
Ukrainian-American businessman Lev Parnas (left) is seen in a 2018 social-media post appearing to show him at the White House with President Donald Trump in a screen capture from his social media account made in 2018 by the Campaign Legal Center.

Parnas and Fruman have filed a lawsuit in Ukrainian court against Kolomoyskiy over the comments he made in the May 17 interview, which was conducted by Schemes, a joint project of RFE/RL's Ukrainian Service and Ukraine's UA:Pershy television channel. The lawsuit also names Schemes as a defendant.

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    Mike Eckel

    Mike Eckel is a senior correspondent reporting on political and economic developments in Russia, Ukraine, and around the former Soviet Union, as well as news involving cybercrime and espionage. He's reported on the ground on Russia's invasion of Ukraine, the wars in Chechnya and Georgia, and the 2004 Beslan hostage crisis, as well as the annexation of Crimea in 2014.

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    Liubomyra Remazhevska

    Liubomyra Remazhevska is a correspondent for RFE/RL's Ukrainian Service.

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    Heorhiy Shabayev

    Heorhiy Shabayev is a journalist with Schemes (Skhemy), an investigative news project run by RFE/RL's Ukrainian Service. He is a graduate of the Institute of Journalism at Taras Shevchenko National University of Kyiv and the author of a dozen investigations into corruption in the government, the construction industry, and in large state-owned enterprises.

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