02/19/2004 | Franz K.

Jailed for nothing: A banker’s story
By Peter Byrne, Kyiv Post Staff Writer
Feb 19, 2004 01:27
http://www.kyivpost.com/nation/nation_general/20773/

“No one in this government is big enough to take my husband away.” - Olena Feldman


When March 8 rolls around, Olena Feldman will be driving the lonely highway back to Kyiv from Luhansk. The trip usually takes her about five hours, depending on the weather, road conditions and how many cups of coffee she’s had.

The 36-year-old mother of four, and wife of Sloviansky Bank Vice President Borys Feldman, has made the trip to Kyiv, where she consults with lawyers and politicians about her husband’s court case – one of Ukraine’s most controversial – dozens of times. She stops off in her hometown of Dnipropetrovsk to look in on the kids, shop for groceries and take a break from the claptrap of courtroom rhetoric.

Life has no been less hectic – but infinitely more bizarre – for her husband, who remains stuck in a Luhansk prison, waiting for the Supreme Court to overturn his conviction on criminal charges that his lawyers call “imaginary.”

Borys Feldman was arrested in Kyiv in March 2000 for allegedly failing to pay income tax on a loan he received from his own bank. While the charge was not a criminal offense, authorities held Feldman in pre-trial detention for two years while tax police attempted to uncover other crimes he might have committed.

None were found.

Vasyl Malyarenko, former chief of the Supreme Court’s criminal justice chamber, instructed Luhansk’s Artem District Court in December 2001 to try the state’s case against Feldman. In April, 2002 the court sentenced him to five years’ imprisonment for failure to pay income tax on a loan, adding another four-year jail term for embezzling from his bank.

Feldman’s attorneys Andrey Fedur and Viktor Ageyev say the convictions fly in the face of common sense, not to mention the fact that the tax laws do not require borrowers to report loans as net income. The embezzlement charge appears equally ridiculous, they say, since Sloviansky Bank reported no unaccounted-for losses.

The Luhansk Appeals Court upheld the convictions in September 2002, setting the stage for another appeal to Ukraine’s Supreme Court, which on Feb. 17 scheduled another hearing for March 9.

Feldman’s case is rarely mentioned in the Western press. Meanwhile, state-controlled media ignore the story, and Western embassy heads have been reluctant to comment on it, even after thousands of Sloviansky Bank’s account-holders signed petitions presented to Kuchma in 2001 - petitions written in their own blood - and camped out in front of oblast administration offices in Zaporizhya and neighboring Dnipropetrovsk.

Yury Vasylenko, a Kyiv appellate court judge, said the state’s handling of the case against Feldman and his bank is an example of how the courts cover up human rights abuses perpetrated by law enforcement agencies at the behest of government officials.

“I have seen few cases as botched as this one in my 32 years as a judge,” Vasylenko said, adding that he hoped it was only a matter of time before someone - or some government - came to the defense of Feldman, whom Vasylenko called a victim of dysfunctional jurisprudence.

The case has interested Yuri Lyubimov, the eminent Russian theater producer, who plans to stage an adaptation of Franz Kafka’s “The Trial” based on Feldman’s ordeal. The play is scheduled to premier at Moscow’s Taganka Theater this fall, according to Ukrainian playwright Leonid Kryvoruchko.

“The Trial” tells the story of Josef K., who is suddenly arrested, with no explanation given and for no reason he can imagine. As he wanders through a maze of bureaucracy, declaring his innocence, he becomes more and more entangled in the system, putting himself in ever-greater danger.

The world described by Kafka closely resembles Ukraine’s judicial system, according to Kryvoruchko, with officials employing the same techniques as Joseph K.’s accusers.

An interrogation of Feldman in 2001 by former State Tax Administration deputy head Syatoslav Pyskun became, arguably, Kafkaesque.

“Why are you quibbling about the wording of our accusation against you?” Feldman recalls being told. “Just take out the words you don’t like in the indictment, and we’ll do the rest.”

In correspondence from prison with the Kyiv Post, Feldman writes that the interview came months before Pyskun’s boss, then STA chief Mykola Azarov, blurted out to reporters that recordings made in 2000 in President Leonid Kuchma’s office are “fakes” - recordings on which Kuchma and his cronies allegedly discuss framing Feldman. Azarov also claimed they were deliberately falsified on Feldman’s instructions, to prove he had been unjustly accused.

Transcripts of the alleged conversations and the recordings themselves are available to the public on www.5element.net, an Internet project launched by Oleksandr Zhyr, a retired colonel from Ukraine’s State Security Services and a former parliamentary deputy.

“No one who has listened to the numerous recorded conversations about Feldman doubts their authenticity,” Zhyr told the Post on Feb. 18.

Andrey Fedur said that Virginia-based Bek Tek, an audio forensics firm, has authenticated lengthy conversations between Kuchma and Azarov recorded in February, April, May and August of 2000.

During a May 24, 2000 conversation, Kuchma suggests that Azarov have Feldman intimidated into confessing his guilt.

“Put him in a cell with convicts,” Kuchma says. “Let them pound him.”

In another conversation, recorded on Aug. 30, 2000, Azarov told Kuchma that he has arranged with Malyarenko to have Feldman convicted in Luhansk.

“We agreed with the Luhansk court and have already acquainted a court chairman there with the case,” Azarov says. “Malyarenko and I have talked about adding a bribery charge. We have discussed this there with the judges, whom we can manipulate.”

Before being liquidated in 2002, Sloviansky was Ukraine’s most profitable commercial bank, posting Hr 83.34 million in profits in 1999 on Hr 556.1 million in net assets, the highest result among 130 banks belonging to the Association of Ukrainian Banks.

Kuchma promoted Pyskun in July 2002 to the post of Prosecutor General and appointed Azarov deputy prime minister and finance minister in November 2002, when he lobbied successfully for Malyarenko’s election as Supreme Court chairman.

In an abridged interview appearing on Feb. 14 in the weekly Zerkalo Nedeli, Borys Feldman indicated that he has no intention of coming to an “accommodation” with the authorities, even if it would allow him to gain his freedom.

“I can’t agree that there is a theft when nothing is stolen,” Feldman said. “Nothing depends on me - it’s the same as agreeing that 2 x 2 equals five, or that the sun rises in the west.”

Olena Feldman told the Post on Feb. 18 she will be back in Kyiv on March 9.

“No one in this government is big enough to take my husband away,” she said. “No one.”