Is This Man the Most Powerful Jew in the World?

Igor Kolomoisky became one of the most prominent figures during this year's Ukraine unrest, unafraid to poke the Russian bear – and especially President Vladimir Putin – with a big stick.

Sazonchik Konstantin/ITAR-TAS

KIEV – Igor Kolomoisky is not a man to trifle with niceties. The third-richest citizen in Ukraine – and suddenly one of the most influential politicians in the torn country – enjoys discomfiting people who meet him for the first time. In his office in Dnipropetrovsk, he has a massive shark tank. During business meetings, the 51-year-old enjoys pressing the button on his desk that releases live shrimp into the water, and then watching his visitors’ reactions to the feeding frenzy.

“He is like a man with Tourette’s,” says a businessman who often meets with Kolomoisky. “Even if he likes you, he will curse you and your mother throughout the entire conversation. He can kick you out of the room without hesitation. He enjoys showing everyone that all the money and the power haven’t changed or smoothed him.”

This April, a few weeks after his emergency appointment as governor of Dnipropetrovsk province, Kolomoisky was photographed proudly wearing a particularly scandalous T-shirt. It combined the Jewish emblem of the menorah along with the Ukrainian ultranationalist symbol of a trident, and all in red and black. Beneath it said “Zhidobandera” – an amalgamation of a Russian-Ukrainian word for Jews, normally regarded as derogatory, and the name of Stepan Bandera, the most controversial figure in Ukraine’s history. Bandera was the leader of the Ukrainian national movement, resisting Soviet rule, before and during World War II. At least some of his followers carried out pogroms and mass murders of Jews. He himself was murdered by the KGB in 1959 and has always been seen by the Soviets – and, to this day, Russia – as a fascist they claim collaborated with Nazi Germany. “Banderovtzi” is a slur still used by the Kremlin’s propaganda machine against Ukrainians who resist Russian influence, and, for obvious reasons, his memory is a highly uncomfortable one for most Jews.

Kolomoisky serves as the president of one of the main Jewish organizations in Ukraine and holds joint Israeli citizenship. Yet he also seems to enjoy embarrassing members of the Ukrainian-Jewish community, putting out the message that he has no limits in politics and would have no qualms making alliances even with those who many Jews believe are still, at the very least, tainted with anti-Semitism. His chief goal, however, seems to be provoking the man who has become his mortal enemy – Russian President Vladimir Putin.

Shoring up Kiev

Kolomoisky controls a wide-ranging business empire, whose value is estimated by various sources at between $2 billion and $7 billion, though few have a clear notion of the extent of his assets. He has served as the governor of the eastern Dnipropetrovsk region since the temporary government was formed after the “EuroMaidan” revolution in Kiev last winter. Kolomoisky was selected for two main reasons. As a wave of revulsion swept Ukraine at the rank corruption revealed following the departure of deposed President Viktor Yanukovych in February, the country’s business community scrambled to shore up the shaky administration and prove its allegiance to the new order. Kolomoisky, the oligarch at the center of the PrivatBank Group, was the man who cemented this new alliance. (The group has major holdings in mining, banking, oil, media and transport firms, including a controlling share in Ukraine International Airlines.)

There was another, even more pressing, reason that someone of his caliber was needed to represent Kiev in Dnipropetrovsk. The prosperous city is the hub of Ukraine’s industrial heartland, at the center of the Russian-speaking east. This would also be one of the main targets for Russia, anxious to undermine and delegitimize the pro-Western government in Kiev. Days after the overthrowing of the Yanukovych administration, huge, Russian flag-waving crowds were already gathering across the east, demanding secession and calling upon President Putin to protect them. Even before Russian troops occupied Crimea in February-March, it was clear the Kremlin was planning to threaten Ukraine with dismemberment if it insisted on distancing itself from Russian influence.

Russian President Vladimir Putin speaks to the media in Ulan Bator, Mongolia
AP

Whether or not the threat would be carried out, continued unrest in large swaths of the country could foil plans to hold new nationwide elections in May. Police forces and army units in the east were demoralized, under-equipped and of doubtful loyalty. They had failed to restore order or prevent the violent treatment of pro-Kiev demonstrators at the hands of pro-Russia protesters. Police stood by as administration buildings and security-service headquarters were seized and ransacked.

Kolomoisky, who in recent years had been spending most of his time tending to his business empire from a second home near Geneva, Switzerland, immediately returned to his hometown and got to work. The first stage consisted of providing local police and military forces with the most basic of equipment, including car batteries, fuel and tires for their patrol vehicles, and ensuring their loyalty with a combination of sticks and carrots. To boost their numbers, along with his partners, Kolomoisky drafted thousands of Privat Group employees as auxiliary police officers. “In days, the demonstrations in Dnipro disappeared,” says one resident. “The city has never been so calm and safe.”

While in other parts of Ukraine the police are rarely seen away from the main interchanges – where they are mainly concerned with catching errant motorists, extracting a fine or a bribe – the police are now highly visible in Dnipropetrovsk, patrolling well-lit streets in their new squad cars.

Some of the new recruits and volunteers were given additional weapons and training, and went on to form the Dnipro battalion, with a fleet of gray SUVs and its own uniforms. It is the best-equipped unit of a number of armed militias that began fighting pro-Russian separatists in the east, not always in full coordination with the Defense Ministry in Kiev.

An added touch that put Kolomoisky’s signature on the security program was his offer to pay cash prizes to local militiamen who repulsed separatist attacks, and his system of bounties for those handing in weapons used by the pro-Russians – $1,000 for a machine gun; $1,500 for a heavier weapon; $2,000 for a grenade launcher; and $10,000 for turning in a separatist fighter.

It’s not clear how many separatists were actually turned in (although local drunks tried to cash in by giving up their friends), but the results are unequivocal. Pro-Russian protests in and around Dnipropetrovsk died down quickly. “It’s safer to walk the streets here now than any time I remember since communist rule,” said one local resident. Kolomoisky has gradually expanded eastward, establishing his control over neighboring districts in the Lugansk and Donetsk provinces closer to the Russian border. He created a de-facto border between the regions controlled by pro-Russian separatists and the Ukraine still under Kiev rule, or at least under Kolomoisky.

For Ukraine, the most important result of Kolomoisky’s intervention was blocking chaos from spreading to the entire east, especially during the presidential election in May, which needed to take place throughout most of the country to gain a degree of legitimacy. The fact the election passed without nearly any hitch in Dnipropetrovsk was key. While to the east, in the Donbass Valley, groups of armed separatists created havoc, Dnipropetrovsk remained an oasis of tranquillity. There are no shortages of food or gas; no pillaged or burned-out stores. The local airport has become the main exit from eastern Ukraine to the outside world, with airliners parked on the tarmac near attack helicopters.

The oligarch’s opponents have accused him of using violence, intimidation and coercion, similar methods to those he has been accused previously of using in some of his business dealings, especially in the takeovers of companies. These included accusations of sending his own club-wielding security people to occupy factories and mines in Ukraine after company owners tried to block his maneuvers. During a legal dispute in 2006, over control of a mining company (which Kolomoisky and his partners won), a judge in London observed that he had “a reputation of having sought to take control of a company at gunpoint in Ukraine.”

Preserving business interests

The foundations of Kolomoisky’s business empire were laid in the wild days following the disintegration of the Former Soviet Union, when the soon-to-be oligarchs scrambled to snap up dilapidated state factories and entire industrial, mining and energy sectors at bargain-basement prices. His operations as governor are not just an act of patriotism to preserve Ukrainian independence, says a local economist, speaking anonymously. “It is also about preserving his and his partners’ business interests. If the separatists had taken the region, he would have lost most of his holdings.” In the wake of the revolution and the crisis between Russia and Ukraine, the country is receiving billions in aid from Western powers, with Privat Group expected to be at the center of any financial action.

Kolomoisky played a key role in blocking pro-Russian advances into the heart of the country. Over the last two months, however, Russia sent its own troops to aid the separatists and beat back the Ukrainian Army and militias supporting Kiev. The government of President Petro Poroshenko – the man originally favored by Kolomoisky and his associates to run affairs – has been forced to accept a humiliating cease-fire with the separatists; last month, he agreed to grant them limited autonomy in the areas they have captured.

As Ukraine prepares for another election later this month, this time for its parliament, Kolomoisky and his partners seem to have shifted their support to the new populist party led by Prime Minister Arseniy Yatsenyuk, which includes a representation of militia commanders. Their support means not only campaign finance, but also friendly coverage from their 1+1 cable channel, with some of the highest ratings in Ukraine. In recent days, Kolomoisky has left Dnipropetrovsk after long months of running the city and been in Kiev for emergency talks. This is a crucial moment for his group, and tensions are running high (as a result, a promised interview with Haaretz failed to materialize).

Yuri Kipperman, one of Kolomoisky’s business partners, told Haaretz, “We took a risk at first defending Dnipro and Odessa – but it inspired other areas in the east to resist. It wasn’t an easy decision, but Putin and Russia acted against us and we had no choice. Our company gave the necessary support to the police and military, including gas and vehicles of the Privat Group.”

Some observers in Ukraine estimate the investment of Privat Group and Kolomoisky personally in stabilizing the Dnipropetrovsk region at over $50 million over the last six months. The group has also taken a hit due to the decision by the Russian government to temporarily seize the assets of Privat Bank’s Moscow subsidiary. Kolomoisky’s holdings in Russian-annexed Crimea are up for public auction. The seizure was ostensibly to protect Russian depositors, but few have any doubt it was the Kremlin’s political retaliation. The bank sustained further damage when its branches in separatist-held towns were destroyed or burned down. In cities like Mariupol where the separatists were in control, Privat Bank branches were also defaced with graffiti cursing Kolomoisky.

But none of this is surprising, considering the fashion in which Kolomoisky built his business empire. He now has to fight both to maintain it and for an opportunity to expand in the future, and he seems to be relishing the challenge. What has astonished even those who know him well is how the oligarch – who previously preferred to operate far from the public eye – has taken to his new, exposed role. In the first week of his governorship in April, he held a press conference in which he made no bones about blaming Putin for Ukraine’s crisis.

In his colorful, often expletive-laden monologues, he said the Russian president was a “psychopath,” a “schizophrenic of short stature” who is “completely inadequate, totally insane. His messianic drive to recreate the Russian empire of 1913 or the U.S.S.R. of 1991 could plunge the world into catastrophe.” It became a personal feud between the outspoken businessman and the former KGB officer. Putin responded a day later, at a press conference in Moscow, calling Kolomoisky a “unique crook” and questioning the motives of the Kiev government to appoint “such a scoundrel. Now this crook is appointed governor of Dnepropetrovsk. No wonder the people are dissatisfied.”

To add spice, Putin told reporters how Kolomoisky had allegedly swindled “our oligarch,” Roman Abramovich (the London-based, Jewish owner of Chelsea Football Club), in a multimillion dollar business deal.

Playing oligarchs off each other is a sport in which Putin is a recognized grandmaster. But in Kolomoisky he is up against a formidable foe, one who is, for now, outside his reach. And when the Kremlin made him a target of their propaganda, they only added to his popularity in Ukraine.

Kipperman is not worried by the feud with Moscow. “Putin is paying the separatists, who are terrorists and criminals – this will bring about his downfall, while we have stabilized the situation in Ukraine.”

After years of remaining in the shadows, Kolomoisky seems to be enjoying his newfound notoriety. Unlike other oligarchs who, once they made their fortunes, tried to construct suave new personas for themselves – learning English and acquiring a wardrobe of tailored suits – Kolomoisky is still happy to conduct his business in a T-shirt and sweatpants, and is not a habitué of fancy restaurants. He also disdains gadgets, proudly owning an old Nokia cellphone on which he makes his calls.

It is fascinating to compare Kolomoisky with another Ukrainian-Jewish billionaire, Victor Pinchuk, who a month ago held the annual Yalta European Strategy conference of his private foundation. Statesmen such as Tony Blair, academic superstars and journalists rubbed shoulders in an ornate arts palace and heard lectures on the future of Europe, while Kolomoisky was cloistered with his inner circle in smoke-filled rooms drinking vodka. Pinchuk is the cosmopolitan, suave oligarch who hangs out with international celebrities such as the Clintons and Elton John, and is proud of having featured on Time Magazine’s 100 most influential people list. Kolomoisky, on the other hand, prefers to stick with his reputation as a street fighter.

‘Don’t go anywhere’

Neither has his new position made him give up his colorful and blunt way of talking. Anonymous sources leaked a phone conversation between him and Oleg Tsarov, a pro-Russia parliamentarian who had fled to Moscow. In it, Kolomoisky, swearing and cursing throughout, told Tsarov that following the death of a member of Dnipropetrovsk’s Jewish community – a militia member killed in the fighting in the eastern city of Mariupol – a $1 million reward had been put on Tsarov’s head. “They will be looking for you everywhere,” he says in the tape. “Don’t go anywhere.” Kolomoisky had no problem confirming that the tape, most likely recorded by Russian intelligence, was authentic, though he claimed he wasn’t threatening Tsarov.

Though not religiously observant, Kolomoisky has been proud of his Jewish identity. Together with fellow oligarch Gennadiy Bogolyubov, he has built the largest Jewish community center in the world in central Dnipropetrovsk – a massive complex that includes a synagogue, library, conference halls, three hotels, kosher restaurants and a supermarket. He served as the president of the one of the organizations competing to represent Ukraine Jewry – the United Jewish Community of Ukraine – and as president of the European Council of Jewish Communities. The center’s seven connected menorah towers stick out on Dnipropetrovsk’s skyline like a middle finger to the Communists and Nazis who tried to exterminate the local Jewish community, today prospering in a country that knew so many centuries of persecution and pogroms.

He has been mentioned as a possible buyer of the Maccabi Tel Aviv soccer club and was an investor in the short-lived JN1 cable news station, which offered news on Israel and the Jewish world. Some of the journalists who were employed there are now working for a new news channel launched by Kolomoisky – Ukraine Today, which has been set up specifically to counter the Kremlin-directed Russia Today network, which is extremely hostile to Ukraine.

Despite repeated warnings of anti-Semitic attacks in Ukraine following the revolution, many Jewish leaders have come out in support of the new Kiev government. Dozens of prominent Jewish figures signed an open letter to Putin in March, calling upon him to stop interfering in Ukrainian politics and urging him to refrain from accusing the new government of being anti-Semitic and neo-Nazi.

But while Kolomoisky is one of the leaders of this surge of Ukrainian patriotism among the country’s Jews, his prominence has still made him subject to criticism. Not all Jewish leaders are happy with the role he has played in recent months. “Jews shouldn’t be involved in politics in such a way,” says one community leader, who asked not to be named. “There is enough anti-Semitism here without making us into more obvious targets.”

“Putin is here to stay,” said another. “We don’t have to pick fights with him.” Yuri Kipperman defended his partner, though, noting, “The Jewish leadership helped to make sure the elections took place safely. We were doing our duty.”

Putin toilet paper

In the streets of Kiev, they are still enjoying the last rays of summer sun. After long months, the city administration has cleared away the ruins and tents from Independence Square, where the revolutionary battles took place in February. The restaurants and bars in the adjoining streets are filled with fashionably dressed young women tottering on impossible heels, while businessmen park their large black SUVs on the sidewalks outside. In the underground passageways, souvenir shops are selling patriotic mementoes in the national colors of yellow and blue, and even toilet paper with the picture of Putin and an unmentionable word beneath his face.

For a moment, it looks like Ukraine’s struggles are over and its independence from its powerful neighbor has been assured. But President Poroshenko’s government is still far from achieving security and stability. It began with promises to kick the separatists out of the eastern provinces, until Poroshenko realized that his army lacks the necessary resources to push back the rebels, who are backed by Russian troops. He was forced to back down rather than confront Putin openly and provoke a full-scale invasion. The United States and Europe are offering financial aid, and have even placed sanctions on Russia, but if Putin gives the order to invade, Ukraine will stand on its own.

Poroshenko is anxious not to give him an excuse, and last month, Ukraine announced it was delaying the signing of a new cooperation agreement with the European Union. The official reason was the need to make necessary changes in the local economy, but the real concern is not angering Putin.

Maintaining a precarious balance between Russia’s demands and the Ukrainian public’s expectations that Kiev assert its independence, Poroshenko is beginning to see Kolomoisky as more a liability than an asset. The militias in the east are not happy with the cease-fire agreement with Russia and may prefer to continue fighting, contributing to the country’s destabilization. Kolomoisky will have to decide whether to withdraw his Dnipro Battalion or break openly with the Poroshenko administration he has so far supported.

As it is, he may have no way back now. Russian investigators have announced that he is to be charged with being responsible for 1,500 deaths in the fighting in east Ukraine, and are seeking to put him on Interpol’s wanted list. He may have trouble returning to his home in Switzerland, as he has said he would prefer to do once the situation in Ukraine has stabilized and Dnipropetrovsk no longer requires his services as emergency governor.

The strongest Jew in Ukraine, perhaps in the entire world, may have already decided that he enjoys frontline politics and to stay on, to try and become the main power behind the scenes in Ukraine’s future.