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| The former PNC Plaza office tower at 500 West Jefferson Street in downtown Louisville. Fri, Aug. 7, 2020. |
LOUISVILLE, Ky. — Federal prosecutors are suing to seize control of the building in downtown Louisville formerly known as PNC Plaza, alleging it is secretly owned by billionaire Russian oligarchs and used to launder billions of dollars they plundered from a bank they owed in the eastern European country.
In a lawsuit filed this week in Miami, the government says the oligarchs and their operatives in the United States bought the 29-story office tower — as well as property in Dallas and Cleveland — with money “traceable to an international conspiracy to launder money embezzled and fraudulently obtained from the bank.”
The scheme was run in the United States by Ukrainians operating out of a 55th-floor penthouse office in Miami using companies with some variation of the name “Optima,” according to the lawsuit.
The Louisville tower at 500 W. Jefferson St. was purchased in 2011 by Optima Management Group LLC for $77 million, but it ran into hard times after the largest tenant, PNC Financial Services, moved out.
The 580,000-square-foot building was purchased out of receivership last year by New York-based Somera Road Inc., according to an article in Business First, but the government’s forfeiture suit says 95% is still owned by an Optima affiliate.
Jefferson County property records show the owner is listed as 500 West Jefferson Street LLC, and corporate records show the sole owner of the company is Ruairidh Henderson, who works for Somera Road in New York.
But in a telephone interview Friday, Henderson said he had never heard of the building and didn’t know anything about it.
In a follow-up interview, when a reporter pointed out that Somera Road was listed as the buyer in a published account — and that a plaque with its name is posted in the lobby — he declined to comment further.
Louisville attorney Don Cox, whose law firm has been in the building for about 10 years, said he was shocked to learn about the background of its secret owner.
The government said that over the course of more than a decade, billionaires Igor Kolomoisky and Gennadiy Boholiubov used their control of PrivatBank to steal billions of dollars of its funds.
The losses were so great that Ukraine had to bail out the bank by providing $5.5 billion to stave off an economic crisis for the country.
In 2017, Kolomoisky, one of the world’s richest men, went into self-imposed exile in Switzerland and then Israel after the government seized his prize asset, Privatbank, and accused him of embezzling billions of dollars, The New York Times reported.
He returned to Ukraine after the comic Volodymyr Zelenskiy, a former business partner of the oligarch, was elected president last year.
FBI agents this week raided Optima properties in Cleveland and Miami, according to press reports.
The suit says dozens of Optima entities in the U.S. were managed by a man named Mordechai Korf, also known as “Motti,” a Miami-based business associate of Kolomoisky and Boholiubov.
Cox said he saw Korf in the building and he appeared to be managing it.
The government said PrivatBank accounted for about one-fourth of the banking sector in Ukraine and one-third of the individual deposit accounts, but that after Kolomoisky and Boholiubov looted it, it was nationalized in 2016.
Prosecutors say the basic idea of the scheme was simple. Kolomoisky and Boholiubov requested money from PrivatBank, which, based on their control and ownership, they always received.
They rarely paid the loans back, except through new loans, the suit says.
The mechanics of the scheme were complex, according to the government. Kolomoisky and Boholiubov used a substantial collection of companies they owned or controlled to apply for loans from PrivatBank.
An army of functionaries at PrivatBank then papered and processed the loans as if they were legitimate.
A “special” credit committee at the bank approved the loans, despite misrepresentations in the applications.
When the loans came due, other loans were used to pay off the old loans, or, in some cases, they were repaid with income from the investment of the misappropriated money, the suit says.
Kolomoisky’s Boston-based attorney, Michael Sullivan, did not immediately respond to a request for a comment.
Follow Andrew Wolfson on Twitter: @adwolfson
This article originally appeared on Louisville Courier Journal: Louisville high-rise was purchased by Ukrainian embezzlers, feds say
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