Kyiv police arrest Dendi president (03/22/98)

Kyiv police arrest Dendi president

by Pavel Politiuk
Special to The Ukrainian Weekly

KYIV - Kyiv police arrested Mykhailo Brodsky, president of a large Ukrainian financial corporation and a co-founder of Kyiv's most popular daily tabloid and charged him with various finance law violations, the Ukrainian Internal Affairs Ministry announced on March 10.

Mykhailo Brodsky, president of the Dendi financial concern, and a candidate in upcoming local and national elections, was arrested by a special anti-crime team in the capital's city center and charged with receiving large sums of money through illegal trade activity.

Internal Affairs Ministry spokesman Viktor Kryvorotko explained the next day that a series of criminal investigations regarding the Dendi financial concern and the activities of its directors was begun last summer. Mr. Kryvorotko said that three earlier efforts to prosecute Mr. Brodsky were unsuccessful because of a law that had granted local lawmakers immunity from criminal prosecution. The law was rescinded by the Verkhovna Rada last month.

Mr. Brodsky, who is a member of a Kyiv District Council, is running for mayor of Kyiv and a seat in the Verkhovna Rada. He also is a co-founder and a shareholder of the popular Kyiv daily newspaper Kievskiye Viedomosti.

An editorial in the newspaper speculated that the detention was prompted in part by recent articles criticizing Ukraine's President Leonid Kuchma and his inner circle. Last year the newspaper printed a series of stories that accused a Kuchma ally, Minister of the Internal Affairs Yurii Kravchenko, of financial improprieties with government funds and of abusing personal privileges.

"It is absolutely clear to me that the arrest is an effort by Ukraine's power elite to force Mr. Brodsky to sell his rights in Viedomosti and make the paper a supporter of the president," said a Viedomosti reporter, Hennadii Kirindiasov, who protested the arrest on March 11 near the entrance to the building that houses the Procurator General's Office.

Mr. Brodsky's lawyer, Yurii Haisinskyi, who met with him in prison after his arrest, said the businessman has declared a hunger strike and explained that his detention is a politically motivated act initiated by his political opponents and Ukraine's authorities.

But Internal Affairs Ministry spokesperson Viktor Kryvorotko said Mr. Brodsky's detention had nothing to do with politics, calling it a "purely criminal" matter. "Some people want to find political motivations in this arrest, but it is only criminal," declared Mr. Kryvorotko.

National Security and Defense Council Secretary Volodymyr Horbulin said that "police would not have taken this step without grounds," especially because Mr. Brodsky is such a popular political and business figure. He declined to comment on any political aspects of the action against the businessman.

Mr. Horbulin said that Dendi Bank, one part of Mr. Brodsky's financial concerns, which collapsed last year, owed depositors the equivalent of $2 million U.S.). Mr. Brodsky has contended that the bank's failure was prompted by government investigations and interference.

Mr. Brodsky and some opposition politicians are sure that the arrest is a consequence of the parliamentary and Kyiv mayoral races. The newspaper Den quoted Yevhen Marchuk, former prime minister and current national deputy as saying: "The authorities have joined the political struggle bringing law enforcement organs into it."

The Interfax news agency reported that the Reform and Order Party said the detention "affirms the current authorities' attempts, under the guise of a struggle with criminal elements, to remove political opponents and bring Ukraine closer to an authoritarian, undemocratic regime."

With elections approaching, the Kuchma administration has been accused of abusing its power in efforts to weaken the opposition. Earlier this year, the government ordered the closing of Pravda Ukrainy, a newspaper supportive of Pavlo Lazarenko, the former prime minister who now leads the opposition Hromada Party.

Last year the Procurator General's Office also accused Mr. Lazarenko along with his ally Yulia Tymoshenko of various financial violations, saying that the former prime minister illegally held foreign bank accounts.