Jan 3, 2018
GOP Leaders Held Private Meetings With Ukrainian Politician Under Investigation for Money Laundering and Supporting Russian Separatists
Two well-connected GOP operatives registered as foreign agents on behalf of Serhiy Rybalka after arranging meetings with Republican congressmen to discuss the war in Ukraine.
By: Scott Stedman
At least four Republican congressmen held private meetings on Capitol Hill this September with an embattled Ukrainian politician and businessman mired in allegations of money laundering, tax evasion, and supporting Russian separatists in Eastern Ukraine.
The meetings were arranged by Great America PAC board member and NYGOP Finance Co-Chair Yuri Vanetik and former Trump Transition Team member Mark Cowan — both well known to GOP lawmakers for their fundraising and lobbying work. The two men registered as foreign agents for these recent activities.
Congressmen Kevin McCarthy (R-CA), Ed Royce (R-CA), Robert Pittenger (R-NC), and Senator Steve Daines (R-MT) each met with Deputy MP Serhiy Rybalka, a member of the Radical Party in Ukraine who claims the criminal allegations against him are politically motivated. Rybalka is known as the “Snack King” for his ownership of snack conglomerate S Group. None of the four congressmen responded to requests for comment.
Raids and Arrests Targeting Rybalka’s Business
The General Prosecutor’s Office in Ukraine has been investigating Rybalka for financial crimes since at least February. In 2016, an investigative report into Rybalka’s business dealings was published by a team of journalists from Radio Liberty, a US-funded broadcasting organization, and Ukraine’s National TV Channel “UA: First”. The reporters found over three dozen trademarks for S Group products were registered to an offshore company in Cyprus. This arrangement, the report alleged, allowed S Group to claim the offshore royalties as costs rather than profits, thus skirting the amount of taxes they owed to the Ukrainian treasury. Following a raid of Rybalka’s offices in February, the Attorney General’s spokesperson confirmed they were carried out “within the framework of criminal proceedings”.
The Secret Service in Ukraine (SBU) has also opened an intelligence investigation into Rybalka for alleged violations of the country’s trade blockade against Russia and Russian-occupied territories. Investigative reports published by The Ukrainian National News Agency (UNN) in late 2016 and early 2017 revealed that S Group products were being sold in Russian-occupied territories, and that “clone companies” using a factory in Russia were manufacturing these products under trademarks owned by a Cyprus company. The reports alleged that Rybalka made millions from this business inside Russia and with Russian Separatists. This revelation led the former Prime Minister Yulia Tymoshenko to call Rybalka a “Kremlin fool.”
In October, one month after Rybalka’s visit to D.C., the SBU raided S Group offices once again and arrested of one of Rybalka’s top executives. According to a statement from SBU, the raid was conducted in relation to “a criminal proceeding investigating the circumstances of financing terrorist organizations” in Russian-occupied eastern Ukraine.
Rybalka did not respond to requests for comment. On his website he denies all allegations, claiming he is under “political persecution”.
Rybalka’s American Agents
Rybalka’s trip to America surprised Ukrainians, as it came amidst calls to boycott his products and a vote by Ukrainian Parliament to strip him of his Chairman position on the country’s committee for financial policy and banking activity. Rybalka documented much of the trip on his personal Facebook page, posting images of himself inside the Capitol Building and posing with McCarthy, Royce, and Pittenger. In one Facebook post, Rybalka wrote that he and Senator Daines “discussed the situation in [Russian-occupied territories] and possible paths to it’s peaceful settlement”.
In FARA filings submitted by GOP donor Yuri Vanetik and former Trump Transition team member Mark Cowan, the foreign agents described their lobbying activities as arranging “meetings with U.S. government officials to discuss U.S. foreign policy relating to Ukraine, international commerce and related matters.”
Rybalka’s US fixer, Yuri Vanetik, is a USSR emigre and U.S. citizen who now resides in Orange County, California. A self-proclaimed financier and philanthropist, Vanetik bundled for John McCain in 2008 and served as the California co-chair and All American Vice Chair for Rudy Giuliani’s presidential campaign before becoming heavily involved in fundraising for the 2016 election.
Vanetik joined the board of scandal-plagued Great America PAC in early 2016, and helped raise $30 million for Trump’s campaign. During the campaign, investigative journalists caught PAC leadership attempting to accept a $2 million foreign donation by routing it through an affiliated non-profit. Contributions from foreign entities are illegal under FEC guidelines. Two months before the election, Eric Trump spoke at a Great America PAC fundraiser hosted at Trump World Tower in Manhattan.
Vanetik was appointed National Finance Co-Chair to the NYGOP earlier this year, despite despite being a California resident. In June, Lara Trump appeared as a special guest during an NYGOP fundraising event
While it’s unclear how Vanetik became involved with Rybalka, the two men share a similar affinity for social media. Vanetik’s now-private Instagram account is a veritable who’s who of GOP elites, showcasing numerous meetings with Speaker of the House Paul Ryan and international tristes with Vanetik’s own California Congressman Dana Rohrabacher. Vanetik has been a major donor/bundler for Rohrabacher since at least 2011. He traveled with the congressman to Berlin in April 2017 and acts as somewhat of an informal advisor.
In July, Vanetik’s Wyoming-based Medowood LLC hired lobbying group Potomac International Partners to provide services on behalf of Rybalka. The firm’s founder, Mark Cowan, is a CIA veteran who served as a member of Trump’s transition team. According to his FARA filing, Cowan was paid $30,000 to arrange meetings between the American and Ukrainian politicians. Vanetik was paid at least $12,000.
Vanetik did not register as a foreign agent until October, even though he began receiving payments from Rybalka in July. DOJ laws state that, “One must register within ten days of agreeing to become an agent and before performing any activities for the foreign principal,” unless given an exemption from the State Department. The State Department referred requests for comment to the DOJ and the DOJ did not respond.
Lydia Dennett, an expert on foreign lobbying and investigator at Project On Government Oversight (POGO) said that this filing appears to be illegal. “It does look like they registered significantly late which is, technically, a violation of the law” she said. However, she cautioned that these laws are rarely enforced, “we here at POGO have found (and confirmed by the DOJ Inspector General) these kind of violations are shockingly common.”
Vanetik and Cowan did not respond to a request for comment when asked how they came to represent Rybalka or how much they have been paid to “raise the positive visibility” of Rybalka among GOP leadership. After meeting with the Ukrainian Prime Minister in June 2016, one of those leaders — House Majority Leader Kevin McCarthy — was caught in a leaked conversation alleging “There’s two people I think Putin pays: Rohrabacher and Trump…Swear to God.” Paul Ryan, who was part of this conversation along with other Republican congressmen, swore the group to secrecy.
