We sincerely hope that after the publication of this article, both law enforcement agencies and financial monitoring authorities in the appropriate countries will collaborate in order to begin filing criminal charges of money laundering in their jurisdictions.

In addition, we hope to show that in Ukraine there is a close relationship between the ruling elite, many of whom are engaged in systematic and coordinated grand political corruption and money laundering abroad.

This article was written with the assistance of information published in the following websites: Ukrayinska Pravda and Nashi Groshi.

There is only one expert who has succeeded in optimizing taxes and normalizing the «money laundering» system for President Viktor Yanukovych, Prime Minister Mykola Azarov, the Secretary of the National Security Council Mr. Andriy Kliuyev and his brother Deputy Chairman of the Party of Regions Serhiy Kliuyev, namely Dr. Reinhard Proksch who until recently attended to all their interests. Dr. Reinhard Proksch, who was born in Liechtenstein, is an Austrian citizen, claims that he has been an accredited attorney in New York for over twenty years, and likely a resident of the United States, as well as the owner of COMPASERVE SE — an incubator of shelf-companies in Switzerland, Germany, Austria Lichtenstein, Great Britain, the USA, and other countries.

COMPASERVE SE team is spread around the world, and nominally consists of elevan persons, including Reinhard Proksch and two of his family members Bridgit and Richard Proksch, who are based in Vienna. COMPASERVE SE has an office in Austria —COMPASERVE HOLDING GmbH, Vienna Parking 12 Tower, Vienna, Lichtenstein — P&A Corporate Services Trust, Vaduz, Stocklerweg 1, аnd also in Britain COMPASERVE (EUROPE) LIMITED, 29 Harley Street, London, besides it has two officices in the United States — 44 Wall Street 12th Floor New York, NY and 60 SW 13th Street 48th Floor #4806 Miami, Florida.COMPASERVE SE offers creation and registration of shelf companies, including Societas Europea, according to the EU Council Regulation 2157/2001. In seven to ten working days COMPASERVE SE opens a shelf company and guarantees team support and relocation of business just for 10,000 Euro, (registration fee is paid separately and usually does not exceed 5,000 Euro).
Below we will demonstrate how in breach of legislation, which explicitly prohibits money laundering by Politically Exposed Persons, Mr. Reinhard Proksch has been assisting the political elite of Ukraine to laundry proceeds of corruption and hide their ownership of luxurious assets and/or companies in Ukraine.

Client Mr. Aleksey Azarov

In 2008 Reinhard Proksch registered a company L.A.D. A. Holding Anstalt, at the address of COMPASERVE SE office in Lichtenstein, i.e. Stoklerweg 1, Vaduz. Mr. Proksch is listed as Director of L.A.D. A. Holding Anstalt. In 2010 this companypurchased on behalf of son of Prime Minister of Ukraine Aleksey Azarov a lovely house in a prestigious part of Vienna Potzleinsdorfer Strasse, 152–156, where Mr. Aleksey Azarov currently resides. This property neither Mr. Aleksey Azarov nor his father Prime Minister of Ukraine include it in their Income Declarations.

Client President Viktor Yanukovych

Dr. Reinhard Proksch also provides services to President of Ukraine, Viktor Yanukovych. Until September 2013 Proksch’s company Blythe (Europe) Ltd, registered under the address of London office of COMPAREVE SE owned Mezhygirrya estate — a luxurious residence of President Viktor Yanukovych.

It is common knowledge that since 2003 the President of Ukraine has been living in a former state residence called Mezhyhirya, which was privatized by MedInvestTrade LLC in 2007 and then sold to Tantalit LLC within two months. Tantalit LLC was founded by Pavlo Lytochenko, a resident of Donetsk; he owns 0.03% (44,000 UAH, approximately 4,000 Euro) of the statutory capital. He is also the founder of Dom Lesnika LLC, which privatized the hunting grounds in Sukholuchya. The second founder of Tantalit LLC is an Austrian company — Euro East Beteiligungs GmbH, which contributed more than 146 million UAH (approximately 13,27 million Euro), accounting for 99.97% of the statutory fund. The Director of Euro East Beteiligungs GmbH is Johan Wanovits was convicted in April 2013 for manipulating shares of Telekom Austria in order to increase the value of bonuses for former telecom managers.

The Austrian Register of Companies shows that the founders of Euro East Beteiligungs GmbH included Blythe Associate Inc(BVI), which transferred its shares to Blythe (Europe) Ltd (UK), and Euro Invest Bank (Austria). It is interesting to note that the principal shareholder of the Euro Invest Bank is Ms. Gabriela Wanovits and the Chairman of the Board of Directors is Frank Wanovits.

In 2008, Euro East Beteiligungs GmbH changed the composition of the company’s founders and only Euro Invest Bank and Blythe (Europe) Ltd were left on the list. Subsequently, Blythe (Europe) Ltd. bought Euro Invest Bank’sshareand became the sole owner with 99.97% of the statutory capital of Tantalit LLC that privatized Mezhygirrya.

It is interesting to note that at the time of purchase of Euro East Beteiligungs GmbH by Blythe (Europe) Ltd, the company had enormous debts,which were 600 times higher than its authorized capital and amounted to 30.5 million euros. Allegedly, this amount of money was Euro East Beteiligungs GmbH investment via Tantalit LLC in Mеzhygirya. However, this did not dissuade Dr. Reinhard Proksch from acquiring the company.

Blythe (Europe) Ltd is registered in London UK; the company has two employees: Director Dr. Reinhard Proksch and a company secretary. According to the British Register of Companies — Company House, Blythe (Europe) Limited was founded by P&A Corporate Services Trust, Lichtenstein office of COMPASERVE SE. In September 2013, Tantalit LLC was purchased by Serhiy Kliuyev for 146.6 million UAH (approximately 13.32 million Euro)— the cost of the authorized capital of Tantalit LLC. Once again, according to the words of Serhiy Kliuyev, he acquired both Tantalit LLC and its enormous debts. According to Sergiy Kluyev, he had to take a loan from PJSC Ukrpidshypnyk.

Dr. ReinhardProksch is also directly tied to the privatization of hunting grounds in Sukholuchya (more than 30,000 hectares) used by President ViktorYanukovych.

Dom Lesnika LLC privatized this domain; this company was founded by a British company — Astute Partners Ltd, whose directoris, according to constituent documents, Reinhard Proksch and the registration addresscoincides with theCOMPASERVICE SE office in London.

Finally, Dr. Reinhard Proksch has also been implicated in the luxury helicopters and aircraft, which are leased through«Tsentravia» LLC for President Yanukovych, and paid with the Ukrainian taxpayer’s money.

The principal founder of Tsentravia LLC is Blythe Associates Inc., which owns over 99.9% of the shares of the aviation company. This company is registered offshore, in the British Virgin Islands. Blythe Associates Inc. from the British Virgin Islands, which currently owns Yanukovych’s helicopter, was listed in 2008 as the founder of the Austrian company — Euro East Beteiligungs GmbH — which already owned Mezhyhirya at that time. In 2008, the composition of shareholders of the Viennese company — Euro East Beteiligungs GmbH — was changed. Instead of Blythe Associates Inc., Blythe (Europe) Ltd.started gaining more and more importance as a shareholder.

In both cases, the tender was held in breach of competitive procurement process with only one participant. Tsentravia LLC won the bidding allegedly due to technical problems in bidding applications of two other competitions. The lack of competitive and transparent bidding process made it possible to pay for air transfer of Presidnet of Ukraine twice the pricequated by Executive Craft, a UK-basead company, which leases similar helicopters and jets.

Clients Andrey and Sergey Kluyevs

Dr. Reinhard Proksch has quite close business relations with Kluyev brothers, and not only through Blythe (Europe) Ltd, but also through P&A Corporate Services Trust, Lichtenstein office of COMPASERVICE SE. In 2009, P&A Corporate Services Trust bought Activ Solar GmbH, a company where the Kliuyev brothers are the beneficial owners. To better explain the relationship between the Kliuyev brothers and Activ Solar we should go back in time. In 1994, Sergey and Andrey Kluyevs founded SLAV Handel Vertretung und Beteiligung AG , which in 2005 founded Slav Beteiligung GmbH, which subsequently founded Activ Solar GmbH. Besides, Slav Handel Vertretung und Beteiligung AG bought PJCS «Ukrpidshypnyk»a huge international consortium, which includes more than 20 enterprises active in different sectors, such as color metallurgy, agriculture, development, insurance, finance, etc.

Slav Beteiligung GmbH founded Activ Solar GmbH in 2008. In the same year Activ Solar GmbH bought 75% of statutory fund of PJSC «Semi-conduct Factory» in Ukraine and in 2009 Activ Solar GmbH was sold by son-in-law of Sergey Kluyev Mr. Kaveh Ertefai to P&A Corporate Services Trust.

According to data compiled from audit reports of the PJSC Semi-Conductor Plant, in period from 2009 through 2011 PJSC Semi-Conductor Plant received a number of loans, totaling at 200 million Euro, from the state bank Eksimbank. PJSC Semi-Conductor Plant was highly unprofitable duirng the above period. Besides, PJSC Semi-Conductor Plant lent money fromActiv Solar GmbH and from its subsidiary in Ukraine Activ Solar LLC. In 2010, Andriy Kliuyev’s Commission issued to PJSC Semiconduct Plant almost 18 million euros (200,842,000 million UAH) to pay off the interest on the loans.

Together, Andriy and Serhiy Kliuyevs managed to make Activ Solar GmbH in its five year existance, the leading manufacturer of solar electricity, which monopolized the market by the state support, such as:

• According to the 2010 Tax Code, sales of solar energy are exempt from payment of profits tax;
• According to the Tax Code, the import of equipment and materials for the production of renewable energy is exempt from payment of VAT;
• In July 2011, the Parliament of Ukraine adopted a law on land allocation for producers of renewable electricity, thus ratifying a 75% discount for the rental of such land;
• 50% of revenues from measures aimed at increasing the volume of production of renewable energy producers are exempt from payment of VAT if they are registered with the National Agency of Ukraine for Efficient Use of Energy Resources;
• According to the Law of 2009, whereby the highest green tariffs for solar energy manufacturers were approved in Ukraine (5.06 UAH per kW), the National Commission on Development of Energy ratified Ordinance for the regulation of electrical energy in favour of Activ Solar in Crimea; by serendipity the Head of the National Commission on Development of Energy is Sergiy Titenko, who worked as Deputy CEO at PJSC Ukrpidshypnyk in 2000, while it belonged to SLAV Handel, Vertretung, Beteiligungs AG, Kluyevs’ business;
• In 2011, the European Commission suspended direct budgetary support for the alleged misspending of costs for energy conservation on connection of Activ Solar LLC (Ukraine) to the national power lines.

The Ukrainian office of Activ Solar is located at Serhiy Kliuyev’s public reception bureau at 3 Reznitska Street in Kyiv.

We would also like to bring to your attention one of the illustrative examples of using Proksch’ self-companies to obtain a Ukrainian state budgetary support for Kluyevs’ business in Ukraine. In 2011 the Ministry of Energy and Coal allocated 69.69 million UAH (more than 6.3 million Euro) to connect solar electric power plants of Activ Solar LLC to the national electricity lines of Ukraine. Public procurement tender was won by «Zvyazoktechservice» LLC, whose origin leads to Compaserve Holding GmbH, Vienna office of COMPASERVE SE and Dr. Reinhard Proksch as Director.

«Zviazoktechservice» started to win public procurement bids in 2011 and up to the end of 2013 received 382,32 million UAH (approximately 34 million Euro). All tenders were for connecting Activ Solar LLC to the national power lines.

Thus, due to the proper coverage provided by Dr. Reinhard Proksch’s shelf-companies, Kluyev brothers, who are in the position to make crucial decisions on spending public money, allegedly abuse their office to support their private business. The above public procurement contract caused the termination of the direct budetary support from the European Commission, which was mentioned above.

Dr. Reinhard Proksch who sells European shelf-companies got very lucky, because he got reliable clients — the political elite of Ukraine. The latter got used to develop their private businesses by using money of Ukrainian tax-payers. This could be a reason Dr. Reinhard Proksch’s clients are so willing to close down «Ukrainian Maidan» movement and intimidate the population of Ukraine, which got tired of the lack of rule of law and grand political corruption in Ukraine.

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