PPP Millions Went to Firm Identified in Ukraine Laundering Suit
(Bloomberg) -- A company accused of helping launder millions of dollars from Ukraine a decade ago is among the apparent recipients of U.S. virus relief funds, according to federal disclosures.
The company, Optima 777, received at least $2 million in loans from the Paycheck Protection Program, according to virus-relief loan disclosures made public Monday. A company of the same name was part of an international scheme in which billions of dollars were siphoned from a Ukrainian bank by one of its owners, Ukrainian billionaire Ihor Kolomoisky, according to a civil lawsuit filed last year in Delaware. The lender, Privatbank, was seized by Ukraine's government in 2016 following allegations of widespread fraud.
It's unclear who controls Optima 777 now. Kolomoisky, who has previously denied wrongdoing, didn't provide a comment.
Read More: Comeback Unravels for Ukraine's Most Controversial Billionaire
The new U.S. disclosures identified companies that received nearly 5 million loans under the federal government's largest coronavirus relief program, the $669 billion PPP. Under the relief program, PPP loans can be forgiven if the recipient satisfies certain conditions, such as using most of the money to meet payroll.
Optima 777, which owns a stake in a Westin Hotel in Cleveland, received between $2 million and $5 million from the Small Business Administration funds to help retain 240 employees, according to the disclosure, which lists loan sizes in ranges rather than precise amounts.
The address listed for the Optima 777 loan matches that of the Sage Hospitality Group of Denver, which partnered with Optima nearly a decade ago to purchase and refurbish what is now the Westin, according to the Delaware lawsuit.
Sage Hospitality, which manages hotels across the U.S., also received $2 million to $5 million in forgivable loans to retain 150 jobs, according to the disclosures.
A spokeswoman for Sage Hospitality declined to say what, if any, stake Sage has in Optima 777. “A Sage affiliate has a small equity interest in the Westin Cleveland and an affiliate of Sage Hotel Management is the operator of the hotel,” she wrote.
Optima 777 didn't immediately respond for requests for comment placed through Sage and a number listed for the firm at the Cleveland Westin.
According to the Delaware suit, filed by Privatbank's new owners, Kolomoisky and a Ukrainian associate diverted hundreds of millions of dollars into commercial real estate and the metals industry in the U.S. The FBI, along with the U.S. attorney's office in Cleveland, have also been investigating Kolomoisky and the allegations about money being looted from the bank while he was an owner, people familiar with the matter have said.
©2020 Bloomberg L.P.
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