Co-owner of Platinum Bank Gurtovoy arrested in Israel in connection with fraud

One of the key shareholders in Platinum Bank (Kyiv) Gregory Gurtovoy on February 17, 2016 was arrested by Israeli authorities and he is suspected of taking money out of his BGI holding company in violation of the law, the Haaretz publication has reported.

According to the newspaper, Gurtovoy appeared at Tel Aviv Magistrate’s Court and was ordered held in custody.

Investigators decided to arrest him after Gurtovoy moved some $3 million out of Willi-Food accounts (part of BGI holding) in January to invest in bonds issued by a European company with no connection to Willi-Food’s core food business.

The name of the company is not disclosed. The company's sole asset is the Grand Hotel Europa.

Investigators suspect that the hotel was used as a conduit for taking money out of Willi-Food.

According to the newspaper, other transactions are being investigated as well. The arrest follows a lengthy secret investigation by the Israel Securities Authority (ISA), which said it suspects him of financial reporting violations, false reporting, aggravated fraud and money laundering.

The alleged violations, which involved BGI executives as well, involve at least tens of millions of U.S. dollars.

The publication said that investigators had been quietly investigating Gurtovoy for some time after he bought BGI from fellow Ukrainian Oleksandr Hranovsky in July 2015. However, there are suspicions that the violations being probed may have begun when Granovsky controlled BGI, which is structured as a pyramid holding group and holds a lot of cash.

Gurtovoy is held in custody while Israel Securities Authority investigators continue to examine the company’s affairs.

As reported, the ultimate beneficiaries include Gurtovoy, Dmytro Zinkov, U.S. citizens David Hаlpert and Boris Goldstein, British citizen Paul Gillham, citizens of Serbia Madjid Dusan Paji'c, Marko Mi'canovi'c and Milica Kostic, citizens of Cyprus Chrysostomos Sofokleous and Marinos L.Karydas, as well as Paul Mousel from Luxembourg. Each of them holds from 7.91% to 9.9% of Platinum Bank's shares indirectly, via offshore entities.

Platinum Bank was founded in 2005.

Platinum Bank ranked 24th in terms of assets worth UAH 6.947 billion among 123 operating banks as of October 1, 2015, according to the National Bank of Ukraine (NBU).

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