The owner of Pari Match Shvindlerman takes #Ukraine hostage

| February 5, 2020 | 0 Comments

By Henry St George

Eduard Shvindlerman is a very secretive character; his public appearances can be counted on the fingers of one hand. But his betting company Pari Match is at every corner. Huge billboards on the streets, annoying online advertising – someone may get the impression that this is a respected international brand. Actually, there is a huge criminal trail behind Shvindlerman’s company, as well as him personally. This company has in fact monopolized the illegal gaming business in Ukraine and its owner is trying hard to remain the monopolist, pushing through a law to legalize the gambling market that is favorable only for the Pari Match betting company.

Eduard Shvindlerman

Shvindlerman and his business with terrorists

If it seems to someone that a brand advertised by a variety of stars — Koshevoy from the 95th quarter or MMA fighter Conor McGregor — might be considered respectable, it’s not worthwhile to be mistaken. Eduard Shvindlerman is a typical example of a man from the criminal 90s who simply managed to flood with dough both the politicians and athletes, stifle the competitors by means of dirty political fraud and corruption. It is Shvindlerman who is the main beneficiary of the adoption of the bill on the legalization of gambling in Ukraine. He needed to corrupt government officials, attract lobbyists from the criminal world to achieve this. And try to completely bring to heel the gambling business in the country.

Eduard Shvindlerman started his business in Kyiv in the mid-90s. There has never been any illusion at the gambling market regarding the real “shareholders� of the Pari Match: it was obvious to everyone that the criminal world had invested in the betting business.

Today, the Pari Match owns licenses for betting in the Republic of Belarus (Statuskvo LLC), Georgia (Ringbet LLC) and Russia (Betring LLC). And according to the same open sources, it works absolutely calmly … in the Donetsk People’s Republic (DPR).

Here is a quote on the activities of the Pari Match in the occupied Donetsk from one of the gambling sites: “This betting company (BC) may offer a wide range of sporting events to everyone. The Pari-Match BC has opened about four hundred offices, however, most of the bets are currently made online, which is not at all surprising. If you prefer to intelligently exploit your own time, then the Pari-Match BC is an ideal option.� That is, the Shvindlerman company is successfully developing its business in the occupied territories, in particular, in the present-day Donetsk. And, without a doubt, they give a kickback to the terrorists who rule the unrecognized republics. This information is useful for understanding that today a person who is trying to take over the gambling industry in Ukraine chums the separatists who kill the Ukrainian soldiers at the front almost daily.

After the ban on gambling in 2009, the Pari Match did not disappear and continued its activity but already illegally. Gambling, betting, casino, poker – all this is the playground of Shvindlerman. The owner of the company and his accomplices managed to circumvent the ban by registering the betting business as a Toto lottery – this is a lottery, the winners of which are determined depending on guessing the results of random events in different types of professional or amateur competitions.

After the ban on gambling, Shvindlerman stated that the company had left the Ukrainian market and had nothing to do with the site www.parimatch.com. Of course, this is a blatant lie. All this time, the Pari Match has been gaining momentum and entangled the country with its nets. Moreover, it tried to whiten its illegal gambling business by injecting money into sports tournaments. Thus, the Shvindlerman’s betting company acts as a sponsor of a number of sports structures in an undefined status, including the football Premier League and the Ukrainian Federation of Hockey.

Nevertheless, Eduard Shvindlerman always had problems with the law: he could not buy everyone. For example, the ruling of the Pechersky District Court after a search at the place of residence of one of the founders of the betting company on October 15, 2015 states: “Documents, objects and things were found during the searches that indicate the organization and conduct of gambling under the Pari Match logo on the Internet. An investigation on the fact of gambling business is conducted by the National Police. The Prosecutor General’s Office brought a case against the Pari Match then. According to the investigation, a group of criminals organized a scheme for withdrawing funds, passing them through the betting company to Russia. An account at Alfa Bank was used for laundering, with the daily flow according to the estimates of the investigators at about 20 million Hryvnias. The total amount of the laundered funds is $350 million per year.

The investigative journalists of the Nashi Groshi publication wrote about this criminal proceeding, in which the journalists named Eduard Shvindlerman and Alyona Shevtsova (née Degrik). The latter, as indicated in the publication, was the owner of the FC Leogaming Pay. In October 2017, the accounts of the FC Leogaming Pay and of the Leogaming LLC  were arrested

Thus, Shvindlerman allegedly sponsors the Ukrainian sports with one hand, and with the other hand he withdraws hundreds of millions to Russia and feels great in his relations with the terrorists in the occupied East. What a respectable businessman, what a respected brand!

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Appetites for a billion

To understand the extent of the illegal profits that Shvindlerman receives from Ukraine, it’s enough to watch an interview with the CEO of the Pari-Match Sergey Portnov. We learn from it that the Pari Match, which, let’s remind once again, conducts illegal betting business in Ukraine, receives an annual income increase of + 43% in dollars, and its market share in Ukraine is up to 40% (even more according to the unofficial sources). Taking into account the fact that the shadow turnover of the betting market in Ukraine exceeds 1 billion US dollars per month.

At least 60 million US dollars are spent on marketing per year. And, according to various estimates, the profit that Shvindlerman’s company receives from the illegal gambling business reaches 25.2 – 85 million dollars a year.

The cost of the Pari Match company is estimated at $500 million by its management. Back in 2016, there was a wish to sell it to the GVC company, and the sale was supposed to happen at the peak – in order to gain $1 billion. But a license in Ukraine was needed for sale, since the main market and the company’s income is in Ukraine. The CEO Portnov said: “The Ukrainian market is huge for us, incredibly huge, a player’s price is cheap. In Ukraine, a player is at least 3 times cheaper than in Russia.â€�

But you can’t sell an illegal business. That is why Shvindlerman’s appetites continued to grow further. So a large-scale special operation was conceived under the name “legalization of gambling for one company.â€� And here he needed lobbyists and political corruption.

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The Servants of Pari Match

Shvindlerman decided to implement his plan to monopolize the gambling market on a large scale. He is sure of himself due to the fact that he, as they say, “made the right bet�, namely, he financed the election campaign of the “Sluha Narodu� (“Servant of the People�) party, and now he wants to return a million times more. Even Kolomoisky could not dream about it.

First of all, representatives of the current government were involved in the scheme, for example, the head of the “Servant of the People� faction, David Arakhamia, as well as the ambassador of the Luzhniki criminal group, lobbyist Boris Baum.

Who is leading a potentially important branch of the Ukrainian economy into the teeth of a monopoly monster in the interests of Eduard Shvindlerman? The journalists of the “Schemes� program in their investigation established that the head of the “Servant of the People� faction, David Arakhamia, has been visiting the central office of the Pari Match betting company at14a, Bozhenko Street in Kiev since July 2019, where he meets with the minority owner of the company and its CEO Sergey Portnov. The rumor has it that the amount involved to interest the parliamentarian amounted to 5 million US dollars. The figure apparently seemed nice.

David Arakhamia

David Arakhamia attracted the law firm Eterna Law to the development of the government bill, and more specifically, its owner and founder, Andrey Astapov, who had previously worked with the Pari Match. In direct communication with reporters, Arakhamia directly admitted that Andrey Astapov was involved in the working group to prepare the bill. As well as one more extremely odious character – Boris Baum. Here is what Arakhamia told the reporters: “And Boris Baum is also there. “Boris Baum? Who is it?� “This is an expert provided by other people.�

Who are these “other people�? Boris Baum is the most purebred representative of the real crime world. The owner of the “gambling� offshore First National Lotteri Ltd. is known as a representative of the Luzhniki group, whose main characters are the Russians Alexander Babakov (who was sanctioned by the US government and the European countries, voted for annexation of the Crimea), Evgeny Giner, Mikhail Voevodin, who have many assets in Ukraine.

Boris Baum (right)

Baum personally, as a Latvian citizen named Boriss Baums, is a co-founder of the London-based companies Banita Limited, Himalita Limited, Maslav Limited, which appeared in the ownership scheme and in the litigation for the Kyivska Rus hotel in the center of Lyiv ten years ago. Baum is also a co-owner of Brenrose Limited company, which owns the RTVI television channel. The National Television and Radio Broadcasting Council has several times caught this channel in recent years for broadcasting in Ukraine concerts of the Russian pop stars, who, after the Russian attack on Ukraine, were listed as persons who are a threat to the national security.

Boris Baum also appeared in the Ukrainian Interior Ministry reports. The Main Investigation Department of the Ministry of Internal Affairs of Ukraine is still carrying out an investigation in criminal proceedings of March 11, 2015, on the facts of misappropriation of the state funds by the officials of the VS Energy International Ukraine company and among them was the current lobbyist of the legalization bill. In the course of the pre-trial investigation, it was found that the theft of the budget funds was carried out by the officials of these companies and by the business entities controlled by them.

The Bill “Give everything to Shvindlerman�

The saga around the development and promotion of the bill, which in the interests of Shvindlerman was actively pushed by Arakhamia and Baum, has been going on since September 2019. Moreover, everything took place in a secret backstage mode. Market participants and the public were content with only occasional leaks of information and rumors.

But this is how it happened chronologically. First, the Cabinet of Ministers on Sunday, September 29, at an extraordinary urgent meeting, under cover of night, approved the bill on the legalization of gambling in Ukraine, which none of the experts had ever seen before. Moreover, the final text of the bill was not made public, although it should be made public at least one month before it is submitted to the parliament.

The bill, as expected, turned out to be lobbist, and in favor of the bookmakers. Despite the fact that the President declared the goal of legalization to limit the activities of casinos exclusively to the territory of 5-star hotels, it turned out quite differently. According to the norms proposed in the bill, bookmakers received the right to conduct any activity literally unlimited: they could install betting machines, have the right to set up online casinos, and so on. In fact, instead of all the slot machines and casinos came the bookmakers. Isn’t that a failure of the President’s task?

Moreover, even after the decision was made, the Cabinet of Ministers could not draw up this project in order to register it in the parliament during 17 more days! Its poor quality is evidenced by the fact that the Verkhovna Rada’s scientific and expert department issued its verdict – the project needs to be improved due to the large number of conceptual comments and legal inconsistencies with the law.

Shvindlerman’s lobbyists took a huge amount of effort to push the project through in this form. Although many ministers were opposed – the Ministry of Finance, the Ministry of Economics, the Ministry of Justice wrote dozens of pages of comments. But Arakhamia and Baum continued to put pressure on behalf of the President: they said, it had to be signed, because the dates had already been set by the President.

It is worth recognizing that the forced legalization of gambling solely in the interests of bookmakers has outraged many deputies from the ruling party. Some of them have registered their alternative bills. In total, seven of them appeared on the Verkhovna Rada’s website.

Of course, it was not in the interests of Shvindlerman, who had already agreed on everything with Arakhamia, to waste time discussing all the draft bills. Therefore, the meeting of the Committee took place quickly, roughly and without careful consideration of the alternatives.

On December 17, at a meeting of the relevant Committee, a member of the Parliament from the “Servant of the People� faction Marusyak, who, together with Boris Baum, was engaged in the project on the instructions of Shvindlerman, instead of the planned bills (Reg. No. 2285 from the Cabinet of Ministers and 7 alternative ones) began to report on the provisions of another draft law not specified on the agenda. He called it No. 2285D, allegedly finalized by some members of the committee, as an alternative to the already registered draft bills. It turned out that a new text was sent to the deputies on Viber at night, which had to be approved. On that day, the deputies –- members of the Committee rightly noted that they could not make decisions on the unofficial text and rejected all the draft bills.

But it was not in the interests of Shvindlerman to allow the decision on the draft law to be postponed until the next year. Since a hundred million dollars has already been invested in the company’s pre-sale advertising, including more than $7 million in a contract with the UFC. On the same day, the deputies were summoned to the Office of the President and were explained that it was necessary to adhere to the position on the dates announced by the President. And it doesn’t matter that the draft law does not comply with the President’s position.

The next day, on January 18, without paying attention to hundreds of comments by the deputies, the Committee voted to consider the draft law in the first reading. But during the voting on December 19, a mishap occurred – the people’s deputies of Ukraine did not vote for the draft law on the legalization of gambling. Moreover, many of the deputies strongly opposed such legalization in favor of the Pari Match solely because of their civil position.

Obviously, the expert opinion influenced the deputy corps. Indeed, legalization of gambling in the form in which it was spelled out in the government law automatically meant “killing� in Ukraine both legal lotteries and potential competition among bookmakers. The whole market was to be given over not just to bookmakers, but to one company – Pari Match. At the same time, the norms of this draft law practically cut off foreign market operators who could bring both rules, values, and respectability into the Ukrainian wild gambling business. This is what the experts, the market participants and international experts say.

Resistance to Shvindlerman’s attempts to establish his own “thieves’ den� in Ukraine is quite logical both from the side of the experts, other market participants, and public activists. The key problem of the proposed bill is that it, in fact, does not solve the problems of the gambling business through legalization. The problem of illegal slot machines remains unresolved, the rules for placing casinos, betting shops and gambling halls are incomprehensible, the strategy and tools to combat gaming addiction are completely absent. That could turn into a real social disaster for Ukraine.

Push it through at all costs

Thus, we know that the owner of the Pari Match Shvindlerman needed the license no matter what, as the costs of the legislative campaign were growing, and the price of the betting company was falling. But the bill was still being discussed, many people were against it. That is why Arakhamia, together with Baum, came up with the ambitions of President Zelensky and still managed to submit the draft for the first reading on December 19, 2019. It is true, the project did not get the required number of votes then.

After the failure of the voting in the first reading in the Parliament, Shvindlerman’s lobbyists decided so to say “to turn the chessboard over�. Shvindlerman, Arakhamia and Baum blamed the market conspiracy for the failure in voting, apparently telling Zelensky that the deputies had been simply outbid by the competitors. Although, in fairness, the gaming market is now too fragmented to agree on the rules of the game so quickly.

And literally on December 20, after the emotional reaction of the President, the Cabinet of Ministers began to close the gambling halls throughout the country. As a result, the entire instant lottery and sports betting market has ceased to exist. Lottery halls that paid taxes into the budget and had 90 thousand employees are all closed and taxes are no longer paid into the budget. The rental market has lost revenues, the state has lost hundreds of millions of budget revenues, and the lottery operators have been left without ground distribution points.

However, there is one big “butâ€�! Shvindlerman even in this situation managed to stay the winner. First, using his ties in power, he has eliminated Favorit – its main competitor in the illegal gaming market. On January 23, law enforcement officials in Kyiv announced searches and cessation of the illegal activities of this betting company in the virtual gambling market. Shvindlerman’s Pari Match, doing exactly the same activity, has not been harmed in any way. And it continues to work, as if nothing had happened. Of course, in the shadow economy, without any payments to the state budget. There is hardly any doubt that the law enforcement authorities have received a very substantial payment from Shvindlerman so that the “clean-up operationâ€� of the gambling halls and virtual casinos would bypass his shadow business. At the very least, the activities of such illegal sites as www.parimatch.com/, https://air.parimatch.com/ru/live-casino are not going to be stopped.

Thus, Shvindlerman with his Pari Match company today has remained the only company that successfully conducts gambling business in Ukraine, doing bookmaking, casinos, slot machines and poker games. All the players and all the money is already flowing to the balance of Shvindlerman. As follows from the interview with CEO Sergey Portnov, the entire system has already been set up, the payment methods have been connected, they have migrated to the new platform, and political issues seem to have been settled already.

All cheap gamers from Ukraine are already on the Pari Match website, including those who have moved from the street segment. The share of Pari Match in this market is close to monopoly.

There is no doubt, using bribery and corruption, Shvindlerman was able to increase his capitalization in the shadow market at times. Having cleared the market, it remains to push through the “legalization� and get the license to be able to sell the company for $1 billion.

The Verkhovna Rada’s meeting of the Committee on Finance, Tax and Customs Policy on January 14, 2020 took place according to the known scenario. The text of the probably improved draft law was sent to the committee members at night on the Viber messenger (or maybe it was not sent, none of the deputies already remembers that). It is important that at the meeting of the committee, the deputies were asked to make a couple of amendments to the already rejected by the meeting of the Verkhovna Rada draft law and to send it back for voting. The deputies were not allowed to propose significant changes, as this would “delay the consideration�. And as it follows from the course of the Committee’s meeting, the deputies didn’t have any options, as “the customer Shvindlerman loses money, and the executors are dragging out the process�. The committee again agreed the same text of the draft law, and the deputies voted for it in the first reading on January 16, 2020. So for the time being, everything is going according to the plan of the big shots of the illegal gambling business.

What’s next? While the public is discussing the legalization of gambling, the market participants are meeting with the deputies in working groups, the experts are preparing materials, the deputies are preparing their amendments to the draft law, Shvindlerman and his group are getting ready for the final chord. When the deputies gather in the parliament on February 4 after the holidays, they will be again insistently “askedâ€� to vote for the same bill already in the second reading. Obviously, the beneficiaries of monopolization will have to use all the methods of pressure, blackmail and buying up the votes of the people’s deputies in order to have the coveted majority of the “for votesâ€�.

In fact, there is now an absolutely non-illusory threat that a whole direction of the country’s economy will be taken hostage by the smart dealers with a very noticeable criminal past and present. And it will all happen under the name of the ruling party in the country and even the head of the state. The deputies do not seem to think about attracting investors anymore, as understanding is growing that a western investor will not pay a large price for a license in Ukraine. In the Ukrainian market, where Pari Match does not pay taxes, but has already taken all the advertising space and gathered the entire customer base “for cheapâ€�, they have nothing to do already, since the competitive environment is no longer equal.

Apparently, Zelensky’s people do not understand it (or do not want to understand it). Which suggests that in the Office of the President, some people already see their share in this market. Considering the reactions of the head of state after a disastrous vote for the bill on legalization, which took place first on December 19, it cannot be ruled out that he personally and his inner circle may be interested in pushing the bill through in its current form.

When Mr. Shvindlerman’s gambling market under the brand name Pari Match is legalized in Ukraine, the number of dependent gambling addicts will continue to grow, as well as Shvindlerman’s business will be growing 200% per year in dollars. Taxes, of course, will not be paid, but people will be losing 100 billion Hryvnias, but already legally. Thus, the original goal of Shvindlerman will be achieved. And the Pari Match will reach the planned cost of 1 billion dollars. Ukraine’s record in selling an illegal startup will be set, and then one couldn’t care less what happens, those will be problems of the Ukrainian society.

In connection with everything that is happening, the question arises: How is it possible at all that a warring state is ready to legalize the entire gambling market for one person, Eduard Shvindlerman, the main beneficiary of the whole legalization story? The person who has been conducting illegal business in Ukraine for years and decades, quietly earning shadow millions in Russia and at the occupied territories, with which we are still in the state of war by the way? The whole story is obviously beyond good and evil. And if the authorities blindly obey the international swindler and nevertheless finish the legalization according to the rules he has written, they will definitely receive a hard lesson in the future on the motives for making catastrophically wrong decisions.

Source:: EU Reporter Feed

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