Geopolitics

Ukraine Fails To Free Tymoshenko, EU Bid At Risk

A Tymoshenko supporter in Kiev
A Tymoshenko supporter in Kiev
Waclaw Radziwinowicz and Tomasz Bielecki

KIEV — So Ukraine's former Prime Minister Yulia Tymoshenko is still a prisoner — and Ukraine's future as part of the European Union hangs in the balance.

The Ukrainian Parliament balked Wednesday night on any decision to release the opposition leader, who has been jailed since 2011. Meanwhile, the EU has sent Kiev a clear message: If Tymoshenko stays in, Ukraine stays out.

Ukraine was expected to sign an accession agreement with Brussels on Nov. 28, paving the way towards becoming the 29th member of the European Union. But the fate of the former prime minister and one of the leaders of the Orange Revolution (2004-2005) stands in the way, as Tymoshenko continues to serve a sentence on charges of abuse of power, a conviction that is regarded by the EU as politically motivated.

Tymoshenko, who is reported to have health problems, is currently serving her seven-year sentence in a hospital under police surveillance.

The current Ukrainian President, Victor Yanukovytch, who won the 2010 presidential elections against Tymoshenko, is accused by many to have pulled the strings in her case.

“I am sure that President Yanukovytch wants to sign the accession agreement,” said Aleksander Kwasniewski, the former Polish president, who together with Ireland's Pat Cox, the former head of the European Parliament, is leading an EU mission to negotiate the release of Tymoshenko.

The two European politicians came to Ukraine to observe the Parliament's voting on a bill allowing the imprisoned to leave abroad for health treatments. It is an open secret that the new law aims to create a gateway for Tymoshenko to accept the offer of medical care in Germany.

On Wednesday night, Kwasniewski and Cox were supposed to report back in Brussels on the results of their mission, but left Kiev empty-handed as the Ukrainian deputies decided to postpone the voting over the changes to the criminal code. Parliament chief Wolodymyr Rybak announced the end of the session shortly after it had started, explaining that the opposition and the ruling party could not come to an agreement over the bill that would set Tymoshenko free.

What should happen with the former prime minister after her treatment in Germany remains the main bone of contention. Whereas the opposition wants the automatic cancellation of the penalty, Yanukovych’s camp wants Tymoshenko back in jail.

One more chance?

If it is not for the sake of justice, it is surely in the ruling president’s best interests. If liberated, Tymoshenko — the most popular politician of the opposition — could become a formidable challenger for Yanukovytch in his 2015 bid for reelection.

The EU emissaries, who understand well the rules of the Ukrainian political game, were showing their poker faces as they exited the Wednesday parliamentary session. “We understand why the agreement could not be made today,” said Kwasniewski. “Nevertheless, we expect the final decision to be made on the next session of the parliament, on Nov. 19.”

The voting over the new criminal law is also being followed closely in Moscow. Russians are monitoring the Ukrainian aspiration to join the EU with a skeptical eye, aiming to keep their neighbor within their sphere of influence.

Reports say Moscow has offered financial aid to help plug Kiev’s leaky budget. On the other hand, the United States put pressure on the International Monetary Fund to unblock a loan program worth $15 billion. The only condition that the IMF imposes — the gas price rise — is however rejected by Yanukovytch who is afraid to loose his popularity before the elections in 2015.

“Signing the agreement with the EU would make Ukraine much more reliable in the IMF's eyes,” a source in Brussels told us.

Pat Cox declared on Wednesday that "our patience has been greatly tested ... but our good will remains undiminished."

Still, the overall mood in Brussels is growing ever more skeptical. “Some of the Western foreign ministries think that Kiev disregards the EU,” a senior EU diplomat says. Others note that Yanukovych is suspected of trying to secure benefits from both Moscow and the EU.

Jacek Saryusz Wolski, a Polish member of the European Parliament, said the latest non-decision is a bad sign. "The constant delaying has made many in the EU lose hope about signing the accession agreement,” he said.

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Economy

Air Next: How A Crypto Scam Collapsed On A Single Spelling Mistake

It is today a proven fraud, nailed by the French stock market watchdog: Air Next resorted to a full range of dubious practices to raise money for a blockchain-powered e-commerce app. But the simplest of errors exposed the scam and limited the damage to investors. A cautionary tale for the crypto economy.

Sky is the crypto limit

Laurence Boisseau

PARIS — Air Next promised to use blockchain technology to revolutionize passenger transport. Should we have read something into its name? In fact, the company was talking a lot of hot air from the start. Air Next turned out to be a scam, with a fake website, false identities, fake criminal records, counterfeited bank certificates, aggressive marketing … real crooks. Thirty-five employees recruited over the summer ranked among its victims, not to mention the few investors who put money in the business.

Maud (not her real name) had always dreamed of working in a start-up. In July, she spotted an ad on Linkedin and was interviewed by videoconference — hardly unusual in the era of COVID and teleworking. She was hired very quickly and signed a permanent work contract. She resigned from her old job, happy to get started on a new adventure.


Others like Maud fell for the bait. At least ten senior managers, coming from major airlines, airports, large French and American corporations, a former police officer … all firmly believed in this project. Some quit their jobs to join; some French expats even made their way back to France.

Share capital of one billion 

The story began last February, when Air Next registered with the Paris Commercial Court. The new company stated it was developing an application that would allow the purchase of airline tickets by using cryptocurrency, at unbeatable prices and with an automatic guarantee in case of cancellation or delay, via a "smart contract" system (a computer protocol that facilitates, verifies and oversees the handling of a contract).

The firm declared a share capital of one billion euros, with offices under construction at 50, Avenue des Champs Elysées, and a president, Philippe Vincent ... which was probably a usurped identity.

Last summer, Air Next started recruiting. The company also wanted to raise money to have the assets on hand to allow passenger compensation. It organized a fundraiser using an ICO, or "Initial Coin Offering", via the issuance of digital tokens, transacted in cryptocurrencies through the blockchain.

While nothing obliged him to do so, the company owner went as far as setting up a file with the AMF, France's stock market regulator which oversees this type of transaction. Seeking the market regulator stamp is optional, but when issued, it gives guarantees to those buying tokens.

screenshot of the typo that revealed the Air Next scam

The infamous typo that brought the Air Next scam down

compta online

Raising Initial Coin Offering 

Then, on Sept. 30, the AMF issued an alert, by way of a press release, on the risks of fraud associated with the ICO, as it suspected some documents to be forgeries. A few hours before that, Air Next had just brought forward by several days the date of its tokens pre-sale.

For employees of the new company, it was a brutal wake-up call. They quickly understood that they had been duped, that they'd bet on the proverbial house of cards. On the investor side, the CEO didn't get beyond an initial fundraising of 150,000 euros. He was hoping to raise millions, but despite his failure, he didn't lose confidence. Challenged by one of his employees on Telegram, he admitted that "many documents provided were false", that "an error cost the life of this project."

What was the "error" he was referring to? A typo in the name of the would-be bank backing the startup. A very small one, at the bottom of the page of the false bank certificate, where the name "Edmond de Rothschild" is misspelled "Edemond".

Finding culprits 

Before the AMF's public alert, websites specializing in crypto-assets had already noted certain inconsistencies. The company had declared a share capital of 1 billion euros, which is an enormous amount. Air Next's CEO also boasted about having discovered bitcoin at a time when only a few geeks knew about cryptocurrency.

Employees and investors filed a complaint. Failing to find the general manager, Julien Leclerc — which might also be a fake name — they started looking for other culprits. They believe that if the Paris Commercial Court hadn't registered the company, no one would have been defrauded.

Beyond the handful of victims, this case is a plea for the implementation of more secure procedures, in an increasingly digital world, particularly following the pandemic. The much touted ICO market is itself a victim, and may find it hard to recover.

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