Ukrainian prosecutors want to use Kroll's audit of PrivatBank in probe into bank refinancing

The Specialized Anti-Corruption Prosecutor's Office (SAPO) is studying the lawfulness of actions by the National Bank of Ukraine (NBU) as part of a criminal investigation in the refinancing of PrivatBank and plans to use materials of an audit of the bank by Kroll.

"On February 28, I signed a letter to the director of NABU [the National Anti-corruption Bureau of Ukraine] about the status of the investigation in this case. All the materials are being investigated, including those to check how it happened that PrivatBank had needed a significant amount of refinancing and where the amount has disappeared. There is also a probe into whether officials of the National Bank acted in keeping with law," SAPO chief Nazar Kholodnytsky told Interfax-Ukraine in an interview.

That is, according to him, this criminal proceeding is being investigated in two directions.

According to Kholodnytsky, SAPO plans to use the conclusions drawn by Kroll as part of the audit of PrivatBank.

"As part of the investigation, we sent international legal assignments to Cyprus and a number of European countries. An audit needs to be conducted. We are now trying to get Kroll's conclusions. We also want to include them into our evidence base," he said.

The National Bank of Ukraine (NBU) earlier claimed that prior to its nationalization in December 2016, PrivatBank was involved in large-scale and coordinated frauds, which caused at least $5.5 billion in damage. The NBU hired Kroll to audit PrivatBank.

After the nationalization, the bank became 100% owned by the state and UAH 116.8 billion (over $4.4 billion at the current rate) in additional capital was injected into it through the issue of government bonds and an exchange of them for the bank's shares.

Late in June 2017, the Cabinet decided to inject another UAH 38.5 billion (almost $1.5 billion) into the bank on the basis of NBU proposals and conclusions by EY, which audited PrivatBank. The first tranche worth UAH 22.5 billion was allocated in July 2017 and another UAH 16 billion in December 2017.