[Pete F.]

Meet Rudy's team

Two Soviet-born Florida businessmen — one linked to a Ukrainian tycoon with reputed mafia ties — are key hidden actors behind a plan by U.S. President Donald J. Trump’s personal attorney to investigate the president’s rivals.

Trump’s attorney, former New York Mayor Rudy Giuliani, said in May that he planned to visit then-incoming Ukrainian President Volodymyr Zelensky to win support for probes into potentially damaging claims raised by senior Ukrainian officials.

Among them was the misleading contention that Trump’s main 2020 Democratic rival, Joe Biden, improperly pressured Ukraine’s government to fire a top prosecutor; that American diplomats in Ukraine had exhibited pro-Democrat bias; and that local officials conspired to undermine Trump’s presidential campaign and help Hillary Clinton in 2016.

Giuliani set off a firestorm in the conservative media by promoting the allegations.

“We’re not meddling in an election; we’re meddling in an investigation, which we have a right to do,” he told the New York Times.

The claims he was pressing have since largely been debunked, but remain politically potent as the next U.S. elections approach.

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Igor Fruman with U.S. President Donald J. Trump.
Credit: Campaign Legal Center
Within days of announcing the planned trip to Ukraine, Giuliani called it off amid a storm of criticism that he was inappropriately interfering in U.S. relations with a foreign country. His efforts in Ukraine, however, have continued.

At the center of Giuliani’s back-channel diplomacy are the two businessmen, Lev Parnas and Igor Fruman, who Giuliani has publicly identified as his clients.

Until now, the men have escaped detailed scrutiny. But a joint investigation by the Organized Crime and Corruption Reporting Project (OCCRP) and BuzzFeed News, based on interviews and court and business records in the United States and Ukraine, has uncovered new information that raises questions about their influence on U.S. political figures.

Both men were born in the Soviet Union and immigrated to the United States. Parnas came with his family at the age of four. Fruman first arrived as a young adult in the 1980s, but later moved to Ukraine and established a series of businesses. Both now live in South Florida.

Since late 2018, the men have introduced Giuliani to three current and former senior Ukrainian prosecutors to discuss the politically damaging information.

The effort has involved meetings in at least five countries, stretching from Washington, D.C. to the Israeli office of a Ukrainian oligarch accused of a multi-billion dollar fraud, and to the halls of the French Senate.

Parnas and Fruman’s work with Giuliani has been just one facet of their political activity.

Since early last year, the men have emerged from obscurity to become major donors to Republican campaigns in the United States. They have collectively contributed over half a million dollars to candidates and outside campaign groups, the lion’s share in a single transaction that an independent watchdog has flagged as a potential violation of electoral funding law.

The men appear to enjoy a measure of access to influential figures. They’ve dined with Trump, had a “power breakfast” with his son Donald Jr., met with U.S. congressmen, and mixed with Republican elites.

Months before their earliest known work with Giuliani, Parnas and Fruman also lobbied at least one congressman — former U.S. Rep. Pete Sessions, a Texas Republican — to call for the dismissal of the United States’ ambassador to Ukraine, Marie Yovanovitch. She stepped down a year later after allegations in the conservative media that she had been disloyal to Trump.

While setting up meetings for Giuliani with Ukrainian officials, the men also promoted a business plan of their own: Selling American liquefied natural gas to Ukraine to replace Russian imports disrupted by war.

In a series of interviews, Parnas said he and Fruman weren’t paid by anyone for their work in Ukraine and that he and his partner have done nothing illegal.

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Parnas and Fruman meet with the president’s son, Donald Trump Jr., and Republican fundraiser Tommy Hicks Jr. in Beverly Hills in May 2018.
Credit: Deleted Facebook post
“All we were doing was passing along information,” he said. “Information coming to us — either I bury it or I pass it on. I felt it was my duty to pass it on.”

He said their political activities were motivated by sincere conviction that they had uncovered wrongdoing that should be investigated.

“We’re American citizens, we love our country, we love our president,”he said.

The men make for unlikely back-channel diplomats. Parnas, 47, is a former stockbroker with a history of unpaid debts, including half a million dollars owed to a Hollywood movie investor. Fruman, 53, has spent much of his career in Ukraine, and has ties to a powerful local businessman reputed to be in the inner circle of one of the country’s most infamous mafia groups.

Giuliani and Fruman didn’t respond to multiple requests for interviews or to written questions. The White House did not respond to a request for comment.

Kenneth McCallion, an ex-federal prosecutor who has represented former Ukrainian Prime Minister Yuliya Tymoshenko in U.S. court, said that Parnas and Fruman were “playing with fire” by lobbying in the United States and Ukraine without registering as foreign agents.

“Trump has either authorized Giuliani to engage in private diplomacy and deal-making, or even worse, remains silent while Giuliani and his dodgy band of soldiers of fortune engage in activities that severely undermine U.S. credibility and are contrary to fundamental U.S. interests,” McCallion said.

‘It Opened Giuliani’s Eyes’
Parnas and Fruman’s work with Giuliani has largely centered on efforts to connect the president’s personal attorney with current and former senior Ukrainian prosecutors believed to hold information harmful to Trump’s rivals.

In late 2018, Parnas and Fruman organized a Skype call between Giuliani and Viktor Shokin, who served as Ukraine’s prosecutor general until he was dismissed by parliament in 2016 amid allegations he was blocking anti-corruption efforts.

Parnas and Giuliani visited the French Senate building, where Giuliani attended a meeting that included Nazar Kholodnitsky, the head of Ukraine’s Special Anti-Corruption Prosecutor’s Office, according to social media posts and interviews. (Kholodnitsky has faced calls to step down after wiretaps in his office last year allegedly caught him interfering in corruption cases.)

By the new year, Parnas said, he and Fruman had also connected Giuliani with Shokin’s replacement as top prosecutor, Yuriy Lutsenko. The Ukrainian official and Giuliani met in New York in January and again in Warsaw the following month.

“[Lutsenko] brought documentation, verification. It opened Giuliani’s eyes,” Parnas said.

Shortly after their February meeting in Poland, both Lutsenko and Giuliani began airing a series of allegations in the U.S. media.

In March and April, the online publication The Hill published a series of opinion pieces largely based on an interview with Lutsenko. The articles relayed the allegations about the Bidens, and went further.

Lutsenko also claimed that officials at the U.S. Embassy in Kyiv had worked with Ukrainian law enforcement to interfere in the 2016 U.S. election by coordinating the disclosure of the so-called “black ledger,” a document that appeared to detail millions of dollars in secret payments from Ukraine’s former ruling party to Paul Manafort, then Trump’s campaign manager. Some of those payments were later verified to be real.

The revelation of the black ledger in 2016 contributed to Manafort’s resignation from the Trump campaign, and helped lead to his prosecution and conviction by Special Counsel Robert Mueller. Since then, prominent Trump supporters have used allegations that the ledger’s disclosure was motivated by anti-Trump bias to cast doubt on the origins of Mueller’s investigation into Russian interference in the 2016 election.

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Ukrainian General Prosecutor Yuriy Lutsenko.
Credit: Vadim Chuprina, Creative Commons
Lutsenko also told The Hill that Yovanovitch, who was still the U.S. ambassador to Ukraine, had handed him a “do not prosecute” list at their first meeting. The Hill characterized the claim as evidence that Yovanovitch was favoring Democrats in the middle of a presidential election because the purported list contained the names of supposed Democrat allies in Ukraine’s parliament and civil society groups.

The State Department has forcefully rejected the claims. In a statement, the U.S. Embassy in Kyiv told reporters: “The allegation of a ‘do not prosecute’ list is an outright fabrication. Such allegations only help the corrupt.”

Still, the allegations caught like wildfire in U.S. conservative media, and were amplified by Giuliani in a series of interviews with cable news and newspapers.

Trump called claims that Ukrainian officials had helped Clinton’s candidacy “big” and “incredible” in an April interview with Fox News, and said that he would leave it to Attorney General William Barr to decide whether to look into them. Barr announced a probe into the origins of the Mueller investigation — in which Manafort’s Ukrainian work became a focus — the following month.

Parnas said he expected all the information he and Fruman had helped advance to become an important part of Barr’s inquiry, and that it would dominate the debate in the run-up to the 2020 election.

“It’s all going to come out,” he said. “Something terrible happened and we’re finally going to get to the bottom of it.”

Debunked But Not Dead
Experts have largely dismissed most of the allegations raised by the prosecutors and relayed by Giuliani as being at best unfounded, and at worst deliberate disinformation.

Both Shokin and Lutsenko are widely viewed among Ukrainian reformers as lacking credibility, and civil society groups have accused them of covering for suspects in major corruption cases.

Joe Biden had indeed pushed for Shokin’s dismissal, threatening that the U.S. would withhold $1 billion in loan guarantees if he remained.

“I looked at them and said: ‘I’m leaving in six hours. If the prosecutor is not fired, you’re not getting the money,’” Biden recounted in a 2018 speech at the Council on Foreign Relations. “Well, son of a bitch. He got fired.”

However, Biden was not alone in his disdain for Shokin. The former top prosecutor was dismissed by parliament after a chorus of criticism by European diplomats and international organizations, and even street protests calling for his resignation.

Local anti-corruption activists had become convinced Shokin was quashing investigations into Burisma’s owner, Mykola Zlochevsky, and other oligarchs, said Daria Kaleniuk, the director of the Anti-Corruption Action Center, a Ukrainian transparency group.

“Shokin was not dismissed because he wanted to investigate Burisma,” Kaleniuk said. “Quite the contrary. He was dismissed because of a lack of willingness to investigate this particular case as well as other important cases involving high-level associates of [ousted former President Viktor] Yanukovych.”

As for Lutsenko, Kaleniuk said his claims were likely motivated by a desire to hold on to his job as top prosecutor with the incoming Zelensky administration, as well as to find friends in the United States government, where he has long been viewed as toxic.

“He wanted to become a person with whom people in the United States wanted to talk, and then probably he found Giuliani and found a sexy story that fit into the Giuliani agenda,” Kaleniuk said.

Hunter Biden’s work for Burisma, however, still raises eyebrows in Ukraine. The younger Biden’s paid tenure on Burisma’s board came at a time the company and its owner faced multiple corruption investigations. He was likely hired simply to impart his famous last name, Kaleniuk said.

“I think [working for Burisma] was wrong from an ethical point of view,” she said.

In a statement, Hunter Biden defended his previous position on Burisma’s board, saying he worked to help reform the company’s “practices of transparency, corporate governance and responsibility.”

“At no time have I discussed with my father the company’s business, or my board service. Any suggestion to the contrary is just plain wrong,” Biden said.

There is also no known documentary evidence that U.S. officials had worked with Ukrainians to release the black ledger.

Though Giuliani’s visit was canceled and many of his claims debunked, the allegations emerging from Ukraine remain very much alive in the lead-up to the 2020 U.S. election.

The accusation that Yovanovitch had exhibited political bias was reported to be behind her stepping down as ambassador in May.

Lutsenko and Shokin did not respond to requests for interviews. Reporters were unable to reach Yovanovitch.

From the Black Sea to Boca
The previous business dealings of both Parnas and Fruman raise serious concerns about their newfound access to senior American political figures.

A resident of upscale Boca Raton, Parnas once ran an electronics business that was successfully sued for its role in a fraudulent penny stock promotion scheme. He has also worked for three brokerages that later lost their licenses for fraud and other violations. He has never been personally charged.

Court records also show that judges have awarded a series of default judgements against Parnas for multiple unpaid debts. These include over $500,000 he owes to an investor in a Hollywood movie that he had promoted but was never made. He has also been sued a dozen times over the last decade for failing to pay rent on various Palm Beach County properties and has been evicted from two homes.

Fruman’s backstory is even more colorful.

More to come