Swiss banking leak shows how Miami Beach men tied to oligarch reaped a fortune in Ukraine

·14 min read

In their early-20s, Mordechai Korf and Uriel Laber, traveled to Ukraine to help re-establish the country’s Jewish community after the collapse of the Soviet Union.

But Ukraine’s shedding of the yoke of communism and conversion to capitalism allowed the pair to transform their own lives, thanks to their connections and business acumen. They returned to the United States a decade later as multi-millionaires, buying Mediterranean-style waterfront mansions minutes from each other in Korf’s hometown of Miami Beach.

Since then, their success story has gotten more complicated.

The FBI raided their Miami offices in 2020 and also seized commercial properties they owned in Ohio, Kentucky and Texas. The feds’ rationale for the raid, according to court filings, is that Korf and Laber allegedly funneled fraudulent proceeds for a billionaire named Igor Kolomoisky and laundered millions through American real estate, including industrial plants in America’s heartland that have since shrunk or closed. The pair deny doing anything wrong.

Billionaire investors buying up factories and draining assets, resulting in closures and lost jobs, is an old story that has played out across the United States, especially in the northern Rust Belt, though the accusations of money-laundering are a new wrinkle. Korf and Laber deny the allegations of impropriety and maintain that their investments helped local economies.

Kolomoisky, a Ukrainian oligarch, is central to Korf and Laber’s narrative. His story has been well chronicled. He founded one of Ukraine’s biggest banks, PrivatBank, one of his many holdings, only to be accused by the country’s central bank of improperly pocketing $5.5 billion from the institution from 2006 to 2016. It is a claim he has denied.

Kolomoisky has been banned from entering the United States but has not been criminally charged. Korf and Laber, his Miami business partners, haven’t either. The pair have not been questioned by any U.S. law enforcement agencies, said a source familiar with the matter.

A cache of leaked banking data from Credit Suisse, Switzerland’s second-largest bank, shows vast sums of money flowing into accounts owned by Kolomoisky and his family during some of the years when he was alleged to have looted PrivatBank, with a maximum of $2.6 billion held in 2007. It also shows that Korf and Laber held roughly $200 million in the Swiss bank at approximately the same time.

The existence of the Credit Suisse accounts doesn’t necessarily indicate any illegitimate behavior on Korf and Laber’s part, but it opens a window into the high-flying financial world the pair inhabited.

The data was leaked to the German newspaper Süddeutsche Zeitung and the Organized Crime and Corruption Reporting Project, who shared it with the Miami Herald, the New York Times, the Guardian and 48 other news partners across the world as part of a project dubbed “Suisse Secrets.”

Laber, left, and Korf, nearly lifelong friends and associates, made millions in post-Soviet Ukraine.
Laber, left, and Korf, nearly lifelong friends and associates, made millions in post-Soviet Ukraine.

The data doesn’t make clear exactly where the money in Korf and Laber’s accounts originated. The accounts were were closed in 2012.

The duo declined to provide details, but said the accounts were used to hold proceeds from their Ukrainian businesses prior to 2007 and that they complied with all applicable tax laws and regulations.

The American Dream in Ukraine

Korf and Laber first met in the mid-1980s when they were studying at the same yeshiva in Detroit. They were in their early teens and in Korf’s words “hit it off from the beginning.”

In 1991, Korf traveled to Dnipro, Ukraine on a relief mission for Chabad Lubavitch, a branch of Orthodox Judaism. Located southeast of the national capital, Kyiv, Dnipro had a particular significance for Chabad — as the movement’s leader at the time, the Lubavitcher Rebbe Menachem Mendel Schneerson, had grown up there and his father had been the chief rabbi in the city, then called Yekaterinoslav, in the early 20th century.

Under Soviet rule, Dnipro had been a hub of the USSR’s military and space industries and a closed high security city with restricted access. Anti-Semitism persisted, religion was frowned upon by the communist government and Jews were often persecuted.

“These were people that wanted to have some connection and have some ability to practice their religion,” Korf said.

Panorama of Dnipro city in eastern Ukraine.
Panorama of Dnipro city in eastern Ukraine.

Their first Ukrainian business ventures were modest: They imported electronic items to Ukraine and brought Ukrainian hammers, welding rods and light bulbs to the United States, Laber said.

But around 1994, according to Korf, their Ukraine footprint expanded dramatically when they partnered with an investor in the United States — they declined to say who — and landed a contract to establish a fixed line telecommunications company. They established Optima Telecom — the name “Optima” from Optima International of Miami, which they had registered for their import-export business.

“By 2003-2004, I think we had the largest fixed-line and internet company in Ukraine besides the government telecom,” Korf said.

Enter Kolomoisky

By the late 1990s, the duo had also started dabbling in the Ukrainian energy sector. That’s how they first partnered with Igor Kolomoisky.

A native of Dnipro, Kolomoisky started trading in consumer goods after the fall of the Soviet bloc and capitalized on the country’s privatization drive, as the formerly communist state sold off its assets.

Together with fellow oligarch Gennadiy Bogolyubov, who cuts a comparatively lower profile, Kolomoisky amassed a sizable portfolio. By the 2000s, they were each billionaires and controlled companies across the world involved in industries as wide-ranging as energy, minerals, airlines, media, banking, soccer and real estate.

Korf and Laber had also started to get involved in the privatization boom. Under the umbrella of Optima Investments, Korf and Laber bought shares of companies worth between $70 and 100 million, Korf said. They began, according to Korf, by first investing for “non-Ukrainian investors” — again, they wouldn’t say who — and charging a fee or an interest rate. Later, they moved into asset management and finally started investing their own money.

Laber said they were primarily interested in “very strategic, large companies,” such as energy producers, electric transmission companies and cement companies.

They were reticent to talk about the nuts-and-bolts of these ventures.

Former U.S. officials said that while it was possible for ambitious foreign entrepreneurs to make a fortune in the chaos of the privatization drive, they, like big corporations, would need local connections.

“There tended to be a lot of corrupt influence that enabled well-connected people to get licenses to do some of those kinds of things,” said William Courtney, special assistant to President Bill Clinton on Russia, Ukraine and Eurasia in the late 1990s. “In strategic sectors you’d often find oligarchs playing a key role.”

Korf and Laber said they first met Kolomoisky in 1997 but their relationship deepened when they worked together to modernize Ukraine’s gas stations.

They said they helped Kolomoisky acquire, among other assets, UkrNafta — the country’s sole crude oil producer and one of the two crown jewels in Kolomoisky and Bogolyubov’s portfolio, along with PrivatBank.

“As a result of the work Motti and I put in … we came to own a small minority stake in a large gas and oil business that is active in the Ukraine market,” Mr. Laber said.

Kolomoisky had a reputation for aggressive business dealings, most notably a raid on Kremenchuk steel plant in central Ukraine in 2006, when under orders allegedly given by him, an army of hired thugs wielding guns, iron bars and chainsaws forcibly took control, according to Forbes.

In this photo taken in Feb. 26, 2010, billionaire businessman Igor Kolomoisky, center, plays soccer in Kiev.
In this photo taken in Feb. 26, 2010, billionaire businessman Igor Kolomoisky, center, plays soccer in Kiev.

But Korf and Laber said Kolomoisky’s notorious reputation was exaggerated — he was “aggressive, tough, but … not bad or violent.”

“I found him to be very straightforward, very personable and a reliable business partner,” Laber said.

Experts on the region paint a different picture.

“He has been a master at corporate raids and certainly has been very aggressive in taking over state companies in the 2000s,” said Margarita M. Balmaceda, a professor at Seton Hall University, who has written multiple books on the post-Soviet energy sector.

She pointed to a 2015 incident where when the Ukrainian government introduced measures to curb his control over the state’s oil pipeline, Kolomoisky sent his men — dressed in military fatigues and reportedly carrying weapons — to the company’s headquarters. When journalists questioned him, he claimed he had liberated the company from “Russian saboteurs.”

The return of the kings

Korf moved back to the United States and settled in his hometown of Miami Beach in 2007, two years after he and Laber sold Optima Telecom for “eight-figures.” Laber, who had grown up in Milwaukee and Chicago, followed his friend to Miami Beach in 2009. They were now millionaires, several times over.

The leaked Credit Suisse data provides an indication of their finances at this time. It shows:

A joint account held by Korf and Laber, opened in 2005 and closed in 2011 that held a maximum of $160 million in 2005. When the account was shut down, only around $150,000 was still in it.

Two accounts owned by Laber, both opened in 2005 and closed in 2010. The maximum the accounts held together was roughly $31 million from 2005 to 2007. The closing amount for them in total was roughly $2 million.

Two accounts belonging to Korf, both opened in 2005 and closed in 2010 and 2012. Together, the maximum they had held was around $27 million in 2007. Less than $1 million is listed as their last holdings amount.

Korf bought his Miami Beach mansion in 2008 for more than $4.5 million, while Laber spent $9.7 million for a mansion of his own, around half a mile from Korf’s. The pair have otherwise lived quiet lives in Miami, with their only known big spending $25 million they have donated to Jewish charities, per a Herald analysis of IRS records.

Back home, their objective was simple: Look for investments less risky than the ones they had undertaken in Europe.

FILE - The Stepova coal mine just before dawn in Pershotravensk, Dnipropetrovsk region, eastern Ukraine, Monday, April 1, 2019. (AP Photo/Evgeniy Maloletka, File)
FILE - The Stepova coal mine just before dawn in Pershotravensk, Dnipropetrovsk region, eastern Ukraine, Monday, April 1, 2019. (AP Photo/Evgeniy Maloletka, File)

They ventured into real estate and their first acquisitions were in Michigan and Ohio.

As the deals grew bigger, the duo realized they couldn’t raise the capital by themselves and turned to their “billionaire friends” Kolomoisky and Bogolyubov in 2008 to help finance the acquisition of One Cleveland Center in Cleveland, Ohio, the city’s fifth-tallest skyscraper.

From around 2006 to 2017, they acquired steel and iron-alloy plants in Kentucky, Michigan and West Virginia and “more than five million square feet” — roughly the size of 90 football fields — of commercial real estate in Ohio, including the Westin Hotel in Cleveland. In 2008 they also acquired the former Motorola campus in Harvard, Illinois and two years later, the 31-story PNC Plaza in Louisville, Kentucky and commercial property in Dallas, Texas.

Things fall apart

Korf and Laber describe these investments as legitimate, but largely unsuccessful. PrivatBank, now under Ukrainian state control, and U.S. prosecutors see it differently.

Ukraine nationalized PrivatBank in 2016 following concerns about the bank’s viability. By that point, the country’s central bank, the National Bank of Ukraine, had discovered a $5 billion hole in Privat’s books. The country’s seizure of the bank set off a flurry of lawsuits across the globe, many of which are ongoing. Kolomoisky and his associates challenged the move’s legality while the bank has alleged that its previous owners, Kolomoisky and his partners, embezzled billions from the bank’s coffers.

Kolomoisky and Bogolyubov were the controlling stockholders of PrivatBank from at least 2006 through 2016. After the bank was nationalized, PrivatBank alleged in a 2019 Delaware civil lawsuit against the two that the pair used the institution as “their own personal piggy bank” during that period and laundered “hundreds of millions of … misappropriated loan proceeds into the United States.” The lawsuit accuses Korf and Laber of being part of the scheme.

The mechanics, per the litigation, involved a series of shell companies, through which Kolomoisky and Bogolyubov took loans from PrivatBank and rarely paid them back. A “special committee’‘ they installed allegedly forged documents and rubber-stamped applications. The funds were not used for their stated purposes but were shuffled through companies all over the world, sometimes within minutes of being disbursed. Millions of dollars were funneled into Miami and companies controlled by Laber and Korf and then used to invest in the United States, the U.S. Department of Justice alleged in civil forfeiture complaints filed in Florida days after the FBI raided Korf and Laber’s offices.

The “Optima Schemes,” as the Delaware lawsuit calls them — referring to Korf and Laber’s Optima companies — were so pervasive that the owners had at one point become “the largest commercial real estate holders in Cleveland.”

Both the Delaware and the Florida suits allege that Optima International of Miami, Inc. and other Florida firms are owned by Korf and Laber on paper but effectively controlled by Kolomoisky and Bogolyubov. The firm allegedly worked with other entities, all of which were controlled by Kolomoisky under the daily management of Korf to “effectuate and coordinate the Optima Schemes.”

To conceal their scheme, the suits states, old loans issued by PrivatBank would be repaid with newer ones and those in turn would be repaid with another round of loans.

Meanwhile, these companies left a trail of boarded-up buildings and unpaid taxes. At least four of their steel plants went bankrupt, leaving hundreds of workers in New York, Ohio, Kentucky and Illinois unemployed, the International Consortium of Investigative Journalists reported in 2020.

Korf and Laber dispute that assessment. They point out that even if many of the investments ended poorly, the net effect was to boost the local economies in which they invested.

A client enters PrivatBank as others stand by in Kiev, Ukraine, Monday, Dec. 19, 2016. Ukraine nationalized PrivatBank, the nation’s largest bank, following concerns over its stability.
A client enters PrivatBank as others stand by in Kiev, Ukraine, Monday, Dec. 19, 2016. Ukraine nationalized PrivatBank, the nation’s largest bank, following concerns over its stability.

Laber also denied the allegation that their businesses were controlled by Kolomoisky.

“The deals were all found and analyzed by me and Motti [Korf] with the assistance of respected advisors … It wasn’t the other way around where someone like Kolomoisky said, ‘Hey, you know, go find something there’,” Laber said.

“They’ve [Korf and Laber] done absolutely nothing wrong and they’ve engaged in no money laundering whatsoever,” said Marc Kasowitz, their attorney, stressing that his clients had “nothing to do with any of the allegedly fraudulent Ukrainian loans taken out as part of an alleged scheme purportedly orchestrated in Ukraine.”

He said 11 Ukrainian courts have found that no funds had been misappropriated: “The fact that these courts are coming down unanimously and finding that the loans were legitimate means that funds were not laundered.”

The Justice Department and Kolomoisky’s attorney in the United States declined to comment. PrivatBank and its attorneys did not respond to the Herald’s questions.

The judge in the Delaware suit has paused proceedings pending the resolution of the lawsuits in Ukraine, stating he wants to avoid inconsistent judgments and that Ukrainian judges are expert in their laws.

Korf and Laber have asked a federal judge in Florida’s Southern District to dismiss the DOJ’s forfeiture case, citing the Ukrainian judgments. One of those Ukrainian judgments found that a 2009 loan for $14 million that the Justice Department alleged to be fraudulent was legitimate. Representatives for Korf and Laber also highlighted this ruling to the Herald.

But DOJ pushed back on taking the Ukrainian judgments at face value in a subsequent filing, arguing that Kolomoisky and his associates had filed a “veritable avalanche” of Ukrainian lawsuits — to obtain favorable outcomes — only after the agency opened their case against them.

“Kolomoisky and Bogoliubov [sic] embarked on a campaign of strategic litigation in Ukraine specifically designed to thwart that U.S. litigation, and the Ukrainian courts obliged by ruling on the claims in these cases,” said the Justice Department in a filing opposing the motion to dismiss.

Experts on the region told the Herald that there is potential for corruption in the Ukrainian judicial system, though they declined to comment on the specific cases.

“The judicial and prosecutorial functions have been vulnerable to corruption all along … and Kolomoisky’s had a lot of influence,” said William Courtney, the former U.S. diplomat.

In this file photo taken on Wednesday, March 25, 2015, then-Ukrainian President Petro Poroshenko, left, listens to billionaire businessman Igor Kolomoisky in Kiev, Ukraine. Poroshenko sought to disparage then-candidate, now president, Volodymyr Zelensky as a ‘puppet’ of Kolomoisky.
In this file photo taken on Wednesday, March 25, 2015, then-Ukrainian President Petro Poroshenko, left, listens to billionaire businessman Igor Kolomoisky in Kiev, Ukraine. Poroshenko sought to disparage then-candidate, now president, Volodymyr Zelensky as a ‘puppet’ of Kolomoisky.

Kolomoisky counts the most influential people in Ukraine among his friends.

His TV stations are courted by Ukrainian politicians and he is reportedly the chief backer of the current president, Volodomyr Zelensky, who has achieved almost mythic status for his leadership amid the ongoing invasion by Russia. When Rudy Guiliani, Donald Trump’s personal lawyer, sought to dig up dirt on President Joe Biden’s son ⁠— an effort that would later lead to Trump’s first impeachment ⁠— he had Florida men Lev Parnas and Igor Fruman, meet Kolomoisky to arrange a meeting with Zelensky.

In 2014, when Russia annexed Crimea and Kremlin-backed separatists attacked eastern Ukraine, Kolomoisky became governor of Dnipro ⁠— the front line ⁠— and bankrolled pro-Ukrainian militias.

It’s unclear where Kolomoisky stands — or currently lives — during the current war with Russia. He also holds Israeli and Cypriot passports and appears to have entirely slipped off the radar.

As for whether Korf and Laber are still working with Kolomoisky, the pair only say that they are still attempting to “preserve the value of the assets” and the jobs of their employees while they await a ruling in the United States.

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