Yulia Tymoshenko’s second attempt to hire US political consultants

EPP Summit Lisbone 18 October 2007 Photo: European People's Party (cc) wikimedia.org

It was only a few months ago when Yulia Tymoshenko’s first attempt to pull the wool over the eyes of Ukrainian voters failed, after she severed his agreement with a pricey Washington lobbying firm.  Tymoshenko could not possibly pay for the exorbitant 65,000 US dollars per month fee on her own because of her wealth declaration and since Ukrainian law prohibits a gift of such value for a People’s Deputy of Ukraine. Instead, Marlen Kruzhkov, a NY-based lawyer, registered Two Paths LLC, a Delaware-based limited liability company, to contract with Trump-connected Avenue Strategies on Tymoshenko’s behalf. 

Kruzhkov, who “represents what he calls Russian oligarchs”, signed a contract with Avenue Strategies on February 20, 2018 according to documents filed with the U.S. Department of Justice’s (DOJ) Foreign Agent Registration Act (FARA) unit on March 13. Two Paths company was registered in Delaware, just a week earlier, on February 13.  As a Washington Times columnist pointed out, Kruzhkov’s past representation of Russian oligarchs “[raised] the issue of who in fact was paying [Tymoshenko’s] bill and for what reason.” Tymoshenko first feigned shock and denied any knowledge of this generous lobbying gift, then informed Two Paths LLC that she cannot work with lobbyists.  On May 11, the contract between Two Paths and Avenue Strategies was terminated, “without engaging in political or other activities” on behalf of Tymoshenko. As reported by a Ukrainian columnist, the two months of payments for these non-existent lobbying services was the easiest 130,000 US dollars made in Washington since Stormy Daniels was paid into silence by Donald Trump.

Yulia’s intricate operation on the east coast

However the shrewd Tymoshenko would not allow her outreach to Washington policymakers to be ended so quickly. Days before her lobbying services agreement between Avenue Strategies and Kruzhkov’s Two Paths was terminated, another company was registered in Maryland, on May 7, 2018 – Innovative Technology and Business Consulting (ITBC).  A month after registering, ITBC’s managing member, Sergei Krasnitski, finalized a 50,000 US dollars per month lobbying contract with the Livingston Group for “government affairs representation and lobbying services before the federal government on promotional issues related to Ukraine and any other matters mutually agreed upon.”  The Livingston Group is headed by Bob Livingston, a former Congressman who was forced to resign from office and as the House Speaker-Elect because of an love affair while the Republican-led Congress was investigating former U.S. President Clinton’s infidelities. He registered with the U.S. Department of Justice as a foreign agent for ITBC on July 6 at 11:46 am, to “provide government relations and representational services for persons supporting reform in Ukraine.”

In a little-seen amendment to the ITBC foreign agent registration with Department of Justice, the Livingston Group filed a dissemination to Members of Congress and Executive Branch officials on July 6 at 11:56 am, announcing Tymoshenko’s intention to “travel to Washington in mid-July to discuss increasing ties between the US and her country.  She is hopeful that you will be willing to meet with her at a time of mutual convenience.”  In exactly ten minutes on July 6, the Livingston Group evolved from advocating on behalf of an unknown, Maryland-registered company for nebulous government relations services to lobbying for Ukrainian opposition leader Yulia Tymoshenko. Impressive. This is express work!

ITBC has no website and according to Maryland’s business entity search engine, the office is registered to a Regus office address at 1829 Reistertown Road, Suite 350 in Pikesville, Maryland. According to LinkedIn, ITBC’s managing member Sergei Krasnitski is a web designer for Blue Cross/Blue Shield. 

A former CIA operative who works closely with the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) and the Office of Financial Assets Control (OFAC) expressed concern about Tymoshenko’s slippery techniques for registering her lobbying services in the United States.  “This does not pass the smell test,” he said.  “Rest assured, the Department of Justice will scrutinize the Livingston Group’s filing and question why direct lobbying for a Ukrainian presidential candidate is done through an LLC, which is likely a violation of Ukrainian law. 

Is Bob Livingston jealous of all the press coverage Paul Manafort has received for legally murky lobbying contracts?”

The Livingston Group previously represented Ukraine’s “Association of Enterprises UKRMETALURGPROM,” headed by Oleksandr Kalenkov.  This 20,000 US dollars per month representation in Washington, registered with DOJ’s FARA unit on April 12, 2018, focused on “advancing the bilateral relations between the governments of the United States and Ukraine.”  Kalenkov was investigated by the International Consortium of Investigative Journalists during the Panama Papers leaks for his role as shareholder of IT Worldwide Services, Inc. which apparently opened offshore accounts in Cyprus via its agent Mossack Fonseca through Omni Management Consultancy FZE.  Kalenkov’s IT Worldwide Services is registered at 63 Sofia Kovalevskaya Street, Apartment 42 in Dnipro, Ukraine – Tymoshenko’s hometown.

During the Livingston Group’s representation of UKRMETALURGPROM, which abruptly terminated on July 8, two days after Livingston began lobbying for Tymoshenko through ITBC, Bob Livingston shepherded Ukraine’s Deputy Minister of Economic Development Natalia Mykolska during her visit to Washington in May.

As a Washington-based lobbyist with experience in Ukraine told me, Tymoshenko thinks either Ukrainian voters or the U.S. government, or possibly both, are fools and can be again hoodwinked. “Red flags are going up throughout Washington on this, and likely in Kyiv in the near future,” the lobbyist said on background due to sensitives with his work in the region. 

The money trail

“Tymoshenko has a sordid history of hiding money outside Ukraine.  Although her methods to hire and pay for lobbying services is a complicated tale, her attempted strategy is simple: to deceive voters in Ukraine and officials in Washington.

First, she initially failed at having the Delaware-based LLC, Two Paths, register on her behalf for advocacy services directly with Avenue Strategies.  This agreement was terminated because it was a violation of Ukrainian law to accept a “gift” 65,000 US dollars per month. 

Second, in April, when Tymoshenko faced criticism and pressure over the Two Paths representation and before the lobbying contract was terminated, she had a member of one of the Dnipropetrovsk business clans, Kalenkov, to begin a lobbying relationship with Livingston.  Simultaneously, it seems, Tymoshenko hired Krasnitski, to register a new company in Maryland, called ITBC. 

Once ITBC was registered, Kalenkov introduced Krasnitski’s ITBC to Livingston for representation and terminated his agreement with Livingston’s firm so as not to appear as though he was receiving lobbying services from Tymoshenko’s representative.  Finally, Livingston registered as a foreign agent for ITBC without mentioning Tymoshenko anywhere in the contract or FARA documents and then inserted an amendment ten minutes later to clarify the Livingston Group was lobbying on behalf of Tymoshenko.”

In addition, there are 3 questions she should be asked.

The first is the question now, as it was before, of who is paying for Tymoshenko’s lobbying and where did this money originate from? 

The second is why is the payment of money to US consultants which is far in excess of her e-declaration not a cause of concern for the Ukrainian authorities?

The third is why does Tymoshenko look at people in general as fools and why does she believe she can hoodwink Ukrainian voters and the American authorities?

Yulia Tymoshenko and US Consultants: 2018 Timeline

 February 6-9 Yulia Tymoshenko visits the United States. In Washington, she meets with Ambassador Volker and Senators Rubio and Nelson; addresses the National Prayer Breakfast on February 8; and attends the Ukrainian Prayer Breakfast on February 9. 

February 13 Tymoshenko middleman Marlen Kruzhkov incorporates Two Paths, LLC in Delaware, USA.

February 20 Two Paths, LLC contracts with Washington lobbying firm Avenue Strategies to provide lobbying services for 65,000 US dollars per month on behalf of Yulia Tymoshenko. 

March 13 Tymoshenko lobbyist Avenue Strategies fileswith the United States Department of Justice as her registered foreign agent (FARA).

March 29 When asked by Ukrainian journalists, Tymoshenko denies any knowledge of the lobbying agreement between Two Paths and Avenue Strategies on her behalf.

April 9 Dnipropetrovsk businessman Oleksandr Kalenkov contracts with the Livingston Group for 20,000 US dollars per month lobbying services for UKRMETALURGPROM

April 11 Tymoshenko informs Two Paths she no longer can accept lobbying services from Avenue Strategies.

April 12 Livingston Group files with the Department of Justice as UKRMETALURGPROM’s foreign agent.  

May 7 Sergei Krasnitski incorporates Innovative Technology and Business Consulting (ITBC), LLC in Maryland, USA. 

May 11 Avenue Strategies terminates agreement with Two Paths, LLC and is no longer Tymoshenko’s foreign agent. 

June 28 Krasnitski’s ITBC contracts with the Livingston Group for lobbying services for 50,000 US dollars per month.

July 6 At 11:46 am, the Livingston Group registers as a foreign agent for Krasntski’s ITBC, LLC.

July 6 Ten minutes later, at 11:56am, the Livingston Group files an amendment that it is advocating on behalf of Yulia Tymoshenko.

July 8 Dnipropetrovsk native Kalenkov’s UKRMETALURGPROM terminates its agreement for lobbying serviceswith the Livingston Group

Taras Kuzio is a Non-Resident Fellow at the Center for Transatlantic Relations, Johns Hopkins – SAIS and Professor at the Department of Political Science National University Kyiv Mohyla Academy. His book, Putin’s War Against Ukraine. Revolution, Nationalism and Crime was published in March 2017.

2019 Ukraine presidential election, corruption, Ukraine, Yulia Tymoshenko