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Wed 2 December 2020

With his expertise in Ukraine, Paul Niland dissects the disinformation about the Oil and Gas company and highlights the real corruption Trump ignores.

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As the impeachment trial of Donald J Trump rumbles on there is now a renewed interest in events in Ukraine related to the son of former Vice President Joe Biden, Trump’s political rival, and a company called Burisma.

The problem is that the facts are being obscured, deliberately, by the partisan dogfight that this process has evolved in to, and these issues are being manipulated to suit a desired outcome rather than being looked for what they actually are.

So, the facts.


The Oil and Gas Company

Burisma is a company with deeply corrupt roots. It was established at a time when Ukraine was a deeply corrupt country, and it was established by a man who was a Minister in the government of the disgraced and now Russian-resident former President of Ukraine, Victor Yanukovych, who was removed from power in a 93 day revolution through the 2013/4 winter.

The Founder of Burisma is a man called Mykola Zlochevsky. When the Yanukovych regime collapsed following the EuroMaidan revolution, Zlochevsky fled Ukraine, as did many others who had served in the Yanukovych government. They did so because they were corrupt, and they feared justice.

In the case of Zlochevsky in particular he had valid reason to fear that the post-revolution authorities would look at reversing the award to Burisma of the oil and gas exploration licences that make up the bulk of the value of the company, because those licences were “’won” by that company at the time that Zlochevsky served as a government Minister.

Without doubt the foundation of Burisma is corrupt and the founder of Burisma is too. As well as physically relocating out of Ukraine, and away from Ukrainian justice, Zlochevsky then went about trying to insulate the company that he had created from any kind of legal or financial attack.


The Prosecutors

To insulate a company from legal or financial woes, in Ukraine, requires a multi-pronged strategy. One of the problems in a country emerging from a deeply corrupt past is that many people in positions of power don’t realise that things have changed, and they must change their ways. There were still plenty of people in Ukraine ready and willing to pay and to receive bribes for illegal acts.

In the case of Burisma, a succession of Prosecutors General opened investigations into this firm because it was low hanging fruit, of course; there was illegal behaviour in the history of the company and of course Zlochevsky was exactly the kind of person who would pay a bribe of millions for investigations to disappear.

The big problem, right now, for how this matter is playing out in the US is that these nuances of how things actually work in Ukraine are little understood and, as a result, the people who Rudy Giuliani thinks are his star witnesses — former prosecutors Victor Shokin and Yuriy Lutsenko — are in fact the exact same people who could have shaken down Zlochevsky by opening and closing investigations into Burisma.

In the case of Shokin, for example, he was allegedly so corrupt that the pressure on then-President Poroshenko to fire him came from a combination of players who have all been instrumental in assisting Ukraine to emerge from the mire of corruption in the 6 years since 100 people died on the streets of Kyiv demanding change.

The international bodies who have pushed for change, and pushed Poroshenko to fire Shokin, include the EU, the IMF, Ukrainian anti-corruption bodies and others. This fact is being overlooked in the portrayal by Giuliani and the President’s lawyers of the firing of Shokin as something undertook by lone ranger Joe Biden. This is an easily disprovable distortion of how Shokin actually came to be fired.

In the case of Lutsenko, he is a long time loyalist to himself and also whoever happened to be in power at any given moment. He was appointed as the replacement for Shokin because, in Ukraine, the office of the Prosecutor General decides who is and is not investigated or charged. As such it is a handy office for the President to have control over. To get Lutsenko installed president Poroshenko (voted out of office because it was felt he did not do enough to combat corruption) had Parliament change the law so that a person with no law degree could become the nation’s top cop.


The Real Corruption Trump Ignores

Back to Burisma, and the demand made by President Trump to investigate this company. While the establishment of this company certainly entailed corrupt practices, Burisma is not — in fact —one of the most corrupt companies in Ukraine. Far from it.

In fact, if Ukraine experts were to draw up a list of the most corrupt companies in Ukraine, Burisma wouldn’t even make page one of such a list. If Trump and his GOP bedfellows were remotely interested in corruption in Ukraine, they would know this. The fact is that (as revealed in the testimony of US Ambassador to the EU Gordon Sondland under questioning from GOP lawyer Steve Castor,) there were only two companies in Ukraine that the White House showed any interest in, Burisma, and Naftogaz.

(Why Naftogaz? Well, that too is a very long story but something we will no doubt learn about in the future.)

If I were to draw up a lit of the most corrupt people or businesses in Ukraine, that list would be headed by one Dmitry Firtash. Firtash is sitting in Vienna trying to avoid extradition to the United States. His case is being assisted by Victoria Toensing and Joeseph DiGenova, the husband and wife legal duo who are both very friendly with Rudy Guiliani and, of course, (you can’t make this stuff up) were hired to be a part of the legal team working on the defence of Donald Trump during the Mueller investigation.

With the Firtash matter in mind, as Burisma is one of only two companies on the Trump Administration radar, we can safely assume that this is for reasons unrelated to corruption and look at why Trump is really interested in it.


Guilt by Association

One of the ways in which a company in Ukraine might also attempt to protect itself from risk is to attract foreigners to give that company a veneer of respectability. Obviously, for such a task, image is everything.

So Burisma engaged three high profile foreigners, Cofer Black, Alexander Kwasnievski, and Hunter Biden. At this point, the Republican story is that Hunter Biden was involved with a corrupt company, in a corrupt country, and so was obviously up to corrupt practices. However, there is not a single shred of evidence showing that Hunter Biden, or the former head of the CIA Counterterrorism Service (Black) or the former President of Poland (Kwasnievski) have done a single corrupt thing between them related to their work for Burisma.

What has genuinely happened at Burisma — according to people who know both the company and the industry — is that there has been a concerted effort in recent years to work to western business practices and to develop a normal profitable company. None of the post-revolution Board members of that company have any responsibility whatsoever for the events that took place before they got involved.

What Hunter Biden can be accused of, reasonably, is bad judgement. He went to work for a bad person, and this creates a perception of wrongdoing by association. By taking on this role, unknown to him at the time, he placed his father in a difficult position.

Following the principle of wrongdoing by association, what Hunter did reflects badly on Joe. If there is a perception (though no evidence) of Hunter being involved in corrupt practices, the story from the GOP is that, most likely, Joe was up to no good too. In fact, Giuliani has gone far enough to make this claim directly. The only problem with this is that the sources of the claims of wrongdoing by Joe Biden are the corrupt former prosecutors Victor Shokin, and Yuri Lutsenko.

A final point. All of this is a distraction, nothing more, from the very real impeachment charges laid against Donald J Trump.

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