Thursday, April 3, 2014

Ukraine Updates - April 3 , 2014 -Ukraine announces new plan for autonomy to its pro-russian eastern regions , naturally a plan to undercut Putin - time will tell whether the plan has legs ......... NATO warns of Russian incursion whereby Ukraine could be swept away in three to five days , US makes symbolic gesture of sending one boat to the Black Sea........Russia's Binbank to take over Ukrainian bank unit after 'political pressure' .......Ukraine far-right leader Sashko Bily 'shot himself' - so says Kiev ..... EU lawmakers urge ‘Magnitsky list’ sanctions against Russia



Move is an attempt to undercut Russian hopes for federalized Ukraine; separately, NASA cuts cooperation with Russia
Crisis-hit Ukraine took a first step Wednesday toward granting more autonomy to its pro-Russian eastern regions as part of an effort – backed by Western diplomats – aimed at undercutting Moscow’s assertion that Russia is justified in violating Ukrainian sovereignty in order to protect ethnic Russians who are allegedly under threat.
The move, which would fall well short of the type of political federation that Russia has reportedly proposed for Ukraine, comes as tens of thousands of Russian troops remain massed along its border and a day after Moscow raised the price on natural gas shipments to Kiev, a move it threatened to repeat Wednesday.
But Ukraine's new government — having won both vital financial backing from the International Monetary Fund  last week and moral support from a meeting of NATO foreign ministers on Tuesday — appeared ready to resist Moscow’s attempts to dislodge the regions in the east of the country that have sizable pro-Russian constituencies.

Ukraine Crisis

See more Al Jazeera America coverage of Ukraine's crisis

In announcing its new plan, the Ukrainian government said it would like to eliminate the current practice under which local governors are appointed by the president, and then move toward a system with local elections. But Ukraine said nothing about granting regions the right to set their own trade policies or establish special relations with foreign states, as Russia desires.
"The main idea behind the concept is to decentralize power in the country and substantially broaden the authority of local communities," the government said in a statement published on its website.
Moscow wants major constitutional reforms in Ukraine in the wake of the February overthrow of the pro-Russian government of former President Viktor Yanukovich, whose rejection of closer economic trade ties with Europe launched months of unrest that morphed into a broader anti-government movement.
Russia would like to see Ukraine transformed into a federation that allows eastern regions in the nation of 46 million to adopt Russian as a second state language, and to overrule some decisions it dislikes made in Kiev.
Moscow has argued that the changes are needed because ethnic Russians have comes under increasing attack from ultranationalist forces that helped the new leaders overthrow Yanukovich. But such accusations from Russia have been largely uncorroborated, and Ukrainian officials have said that they are a fiction.
But the United States and its EU allies fear that Russia – having already annexed Crimea last month – is using the federation idea as an excuse to further splinter Ukraine by effectively granting Moscow veto powers over Kiev's regional policies.
U.S. officials have instead urged Ukraine's new leaders to introduce more targeted reforms that undercut Russian President Vladimir Putin's arguments for sending troops into the pro-Russian regions of Ukraine.
The Ukrainian government's statement is closely in line with U.S. wishes in stressing that a system under which regional governors are appointed by local legislatures would be more efficient.
Earlier Wednesday, in his first interview since fleeing the country in February, Yanukovich called Russia's annexation of Crimea tragic and said he hoped the Black Sea peninsula could come back under Ukraine's control someday.
But he stopped short of placing any blame on Putin.
"Crimea is a tragedy, a major tragedy," Yanukovich said during an interview with The Associated Press and Russia's NTV television, insisting Russia's takeover of Crimea would not have happened if he had stayed in power.

No quiet on the Eastern front

While Ukraine announced the new plan for autonomy, and as Western and Russian diplomats are still struggling to reach a diplomatic solution to the unresolved crisis, Moscow has kept its forces massed on Ukraine's eastern border.
According to NATO on Wednesday, the size of the Russian force would allow Moscow to satisfy any attempt to carry out an "incursion" into Ukraine in a matter of days.
Calling the situation "incredibly concerning,” NATO's supreme allied commander in Europe, U.S. Air Force Gen. Philip Breedlove, said NATO had spotted signs of movement by a very small part of the Russian force overnight but had no indication that this was part of a withdrawal to barracks.
NATO military chiefs are concerned that the Russian force on the Ukrainian border, which they estimate stands at 40,000 soldiers, could pose a threat to eastern and southern Ukraine.
"This is a very large and very capable and very ready force," Breedlove said in an interview with Reuters and The Wall Street Journal.
The Russian force has aircraft and helicopter support as well as field hospitals and electronic warfare capabilities – "the entire suite that would be required to successfully have an incursion into Ukraine, should the decision be made," Breedlove said.
"We think it is ready to go and we think it could accomplish its objectives in between three and five days if directed to make the actions."
Russia has said it has no intention of invading its neighbor, although since the toppling of Yanukovich it has asserted a right to intervene to protect ethnic Russians if necessary.
Further Russian intervention in Ukraine would be an "historic mistake" that would deepen Moscow's international isolation, NATO Secretary-General Anders Fogh Rasmussen said on Wednesday.

NASA cuts Russia cooperation

In another sign of the deteriorating Russian-U.S. relationship on Wednesday, NASA announced that it was suspending most joint activities with its counterparts in Moscow.
“Given Russia's ongoing violation of Ukraine's sovereignty and territorial integrity, until further notice, the U.S. Government has determined that all NASA contacts with Russian Government representatives are suspended, unless the activity has been specifically excepted,” read an internal NASA memo announcing move Wednesday.
Activities excepted from the suspension of NASA’s engagement with the Russian government include the multinational efforts at the International Space Station.

Putin 1 - Dimon 0: JPMorgan Unhalts Russian Money Transfer

Tyler Durden's picture

Yesterday when we reported that a "Furious Russia Will Retaliate Over "Illegal And Absurd" Payment Block By "Hostile" JPMorgan", in which we explained that unlike previous responses to Russian sanctions by the West, which were largely taken as a joke by the Russian establishment, this time Russia is furious, we said that "we certainly can not be the only ones looking forward to the epic battle prospect that is Vlad "Shootin" Putin vs JP "Fail Whale" Morgan." Alas the title fight lasted for just about a day, and was won, with a technical knock out in the first round, by none other than the former KGB spy who can now add the whale which manipulates all markets to its trophy case which includes about 100 statues of a crushed and beaten John Kerry. 
Because after shocking the world with its unilateral decision to halt Russian money transfers without a direct order from the administration, Reuters reports that JPM has folded and will process said payment from Russia's embassy in Kazakhstan to insurance agency Sogaz, easing tension after Moscow accused the U.S. bank of illegally blocking the transaction under the pretext of sanctions.
In other words, Putin 1 - Jamie Dimon 0.
More from Reuters:
The confrontation threatened to further strain ties between Washington and Moscow, locked in the worst standoff since the Cold War over Russia's annexation of Ukraine's Crimea region.

"Following consultation with our regulators, we are processing this transaction," JPMorgan said in a statement.

Last month, Washington imposed sanctions, including visa bans and asset freezes, against several Russians close to President Vladimir Putin and against Rossiya Bank, which it said was the "personal bank" for the leader's inner circle.

The destination for the embassy payment was insurance agency Sogaz, which is 48.5 percent owned by Abros, a wholly-owned subsidiary of Bank Rossiya.

Industry consultants in Moscow say financial institutions are unclear about how to apply the new rules in some situations, such as when dealing with subsidiaries of companies which have either been sanctioned or which have shareholders that have been punished.

Several Western investors and their banks are facing quandaries over individual situations.

Guidelines on the U.S. Treasury department's website from the U.S. Office of Foreign Assets Control says that property which is more than 50 percent owned by a person on the sanctions blacklist is affected and advises acting "with caution" when ownership interests are less than 50 percent.

"It is up to private companies and lawyers to figure out who is subject to sanctions," said one Moscow-based lawyer. "Of course (a U.S. bank) is more scared of the American (authorities than the Russian ones)."
Needless to say, this is quite anticlimatic, as we were certainly looking forward to the discovery of JPM documents which would be released into the public domain following the imminent annexation of all JPM offices in Russia. Looks like we'll have to wait a little longer.
Meanwhile, if even Jamie Dimon.... 
....can't stand up to Putin.... who can?

NATO: Russia Could Invade Ukraine in 3-5 Days

Ignoring Russia Pullback, Officials Keep Hyping a War That Isn't Coming

by Jason Ditz, April 02, 2014
NATO Supreme Allied Commander Gen. Philip Breedlove continues to hype the idea of Russia invading the Ukraine at some point in the near future, saying he believes Russia could conceivably carry out an “incursion” in three to five days.
Russia had a training operation ongoing near the Ukrainian border, but ordered some of the troops redeployed earlier this week. Breedlove insisted the troops are still technically “in the battlefield,” though since there isn’t an actual battle going on the definition of battlefield appears nebulous, at best.
NATO Secretary-General Anders Fogh-Rasmussen insisted that the Russian invasion, which Russia has repeatedly promised isn’t happening, would be “an historic mistake,” and would have “far-reaching consequences.”
Though Russia reiterated that an invasion is not coming, the foreign ministry also mocked the latest NATO comments as revealing a “Cold War-era mindset” among the alliance’s leadership.

U.S. Navy Sending Destroyer to Black Sea to Support Ukraine

The U.S. Navy is sending a destroyer into the Black Sea in the coming days as a symbolic gesture of support for Ukraine and other allies in the region, according to two senior defense officials.
The USS Donald Cook, a guided missile destroyer based in Rota, Spain, and will travel to the Black Sea "in the next week or so," according to one senior defense official.
The ship will take part in to-be-scheduled exercises with allies in the region — most likely pass exercises, where ships from different nations pass one another while at sea — and the Donald Cook will make several to-be-scheduled port calls.

The USS Donald Cook docks in the southern port of Rota on Feb. 11, 2014.

Pentagon spokesperson Colonel Steve Warren confirmed that a ship is heading to the Black Sea in the coming days to "reassure our allies of our commitment to the region."
The last U.S. Navy ship in the Black Sea was the USS Truxton. It departed on March 21.
There was no word on exactly when the Donald Cook will arrive or how long it will stay there.
Six countries border the Black Sea, including Ukraine and Russia and the Russian-annexed Crimea.

Russia's Binbank to take over Ukrainian 

bank unit after 'political pressure'

MOSCOW Wed Apr 2, 2014 9:17am EDT


(Reuters) - Russian lender Binbank said on Wednesday it could buy the Moscow subsidiary of Ukraine's Privatbank in two weeks from its Ukrainian owners who say they were under political pressure to sell.
Russia's central bank put Moskomprivatbank under temporary administration last month to prevent its bankruptcy, but some analysts said it was aimed at punishing Ukraine's new rulers for pursuing closer ties to the West. Moscow denies the charge.
Privatbank, Ukraine's largest bank, said its subsidiary had faced unwarranted political pressure, suggesting it was a victim of the standoff between Moscow and Kiev which resulted in Russia annexing Crimea.
Privatbank is part of Privat group, co-owned by Igor Kolomoisky, called "a unique imposter" by President Vladimir Putin last month when the businessman was appointed governor of Ukraine's Dnipropetrovsk region.
Binbank's co-owner, Mikail Shishkanov, said the Ukrainian side would be happy with the deal.
"It is an absolutely friendly, normal business deal ... in any case the Ukrainian partners will be satisfied," he told journalists, adding the deal should be closed in two weeks.
He said Binbank, a medium-sized lender, would pay for the deal with cash and shares in property in Ukraine.
Privatbank said in a statement the Russian authorities had made it difficult to operate.
"Despite the unprecedented political pressure on Moskomprivatbank from the Russian authorities, effectively blocking bank checks and the unreasonable imposition of temporary administration, the bank continued to work and fulfilled all its obligations to customers," it said.
"We are emerging from a difficult situation with our heads held high despite the difficult political situation."
Ukraine's new rulers have accused Russia of moving to confiscate Ukrainian businesses in Russia to punish the new western direction of its government, installed after months of protests against pro-Moscow President Viktor Yanukovich.
But Binbank said Russia's Deposit Insurance Agency had ruled that Moskomprivatbank, Russia's 95th biggest by assets according to Interfax news agency data, did not have enough liquidity to cover its obligations and a "lack of a fully-fledged independent information infrastructure".
Last month, Moskomprivatbank, with assets of 50 billion rubles ($1.4 billion), had capital requirement ratios above the levels required by the Russian central bank to keep a banking license.
According to the central bank's data for January, the latest available, it had no violations of capital requirements.
It was not clear what had changed since then.

Ukraine far-right leader Sashko Bily 'shot himself'

Right Sector leader Oleksandr Muzychko, who died in a shoot-out with police in western Ukraine - 21 February 2014Oleksandr Muzychko died in a shoot-out with police in western Ukraine
A Ukrainian far-right leader accidentally shot and killed himself during a shoot-out with police last month, an investigation has concluded.
The inquiry by the interior ministry said Oleksandr Muzychko, aka Sashko Bily, had shot himself in the heart as police tried to wrestle him to the ground during the chase.
He was a member of the Right Sector - a key player in Ukraine's mass protests.
The group had threatened revenge for the death, blaming the police.
However, group members have so far made no public comments on the inquiry's findings.
The Right Sector played a prominent role in the Kiev protests - and the clashes with police - that led to the removal of President Viktor Yanukovych from power.
The results of the inquiry into the 24 March shoot-out in the western Rivne region were published on the interior ministry's official website.
Right Sector members protesting outside the parliament building in Kiev - 27 March 2014Hundreds of Right Sector activists blocked the parliament building in Kiev last month
The investigators determined that Mr Muzychko, 51, had shot twice as police were trying to arrest and handcuff him.
The first shot scratched his skin, they said, but the second proved fatal.
The policemen tried to treat him at the scene and called an ambulance.
'Contract killing'
Earlier, one of the police officers was shot and injured by Mr Muzychko during the chase.
The inquiry concluded that the police had acted lawfully.

Right Sector

  • Far-right group that played key role in protests and clashes with police in Ukraine
  • Has well-organised armed units
  • Believed to have hundreds of members across Ukraine
  • Unofficial leader is Dmytro Yarosh, who is running for presidency in May
  • Has been trying to transform itself into mainstream political party
Right Sector activists have been furious over the death of Mr Myzuchko.
"We will avenge ourselves on [Interior Minister] Arsen Avakov for the death of our brother. The shooting of Sashko Bily is a contract killing ordered by the minister," member Roman Koval was quoted as saying by the Ukrayinska Pravda website after the shoot-out.
The minister has denied the allegation.
On 28 March, Right Sector activists blocked the parliament building in the capital Kiev and smashed windows.
The Right Sector's continued presence on the streets has complicated the work of Ukraine's new leaders, who have struggled to demonstrate they are fully in control after Russia's disputed annexation of Crimea and violent pro-Russian protests in eastern parts of the country, the BBC's David Stern in Kiev reports.
What is more, Right Sector has bolstered the Kremlin's seemingly exaggerated claims that "fascists" have taken over Ukraine's government and are roaming the capital's streets, threatening minorities and Russian-speakers, our correspondent adds.
However, the Right Sector has been trying to turn itself into a mainstream party.
Its leader Dmytro Yarosh has already been registered as a presidential candidate in 25 May elections.

EU lawmakers urge ‘Magnitsky list’ sanctions against Russia

Published time: April 02, 2014 22:47
A general view of the Louise Weiss Building, headquarters of the European Parliament, in Strasbourg. (AFP Photo / Frederick Florin)
A general view of the Louise Weiss Building, headquarters of the European Parliament, in Strasbourg. (AFP Photo / Frederick Florin)
The EU Parliament passed a resolution calling on the EU Council to introduce its own version of ‘Magnitsky list’ sanctions against Russia, which consists of 32 Russian individuals.
The list copies a 2012 US law intended to punish a number of Russian citizens believed to be linked to the death of Russian lawyer Sergey Magnitsky. Russia slammed the Magnitsky Act and responded with similar measures against US officials.
“The EU should deny visas to and freeze the EU assets of 32 Russian officials involved in the death of Russian lawyer Sergei Magnitsky, its judicial cover-up and the continuing harassment of his family,” the EU Parliament statement said on Wednesday.
The EU Parliament cited independent investigations which established that Magnitsky, who died in pre-trial detention in 2009, experienced "inhumane conditions, deliberate neglect and torture."
The resolution is advisory in nature and in order to have any weight it must be approved by the EU Council.
MEPs also added their concern that EU foreign policy chief Catherine Ashton neglected to include the issue on the Foreign Affairs Council agenda despite the European Parliament’s earlier request in October 2012.
A handout photo provided on Novenber 15, 2010 by Hermitage Capital Management and taken on December 29, 2006 shows Russian lawyer Sergei Magnitsky in Moscow. (AFP Photo)
A handout photo provided on Novenber 15, 2010 by Hermitage Capital Management and taken on December 29, 2006 shows Russian lawyer Sergei Magnitsky in Moscow. (AFP Photo)

The EU tried to pass a similar resolution back in 2012 and was criticized by Russia. Head of the State Duma’s International Affairs Committee, Aleksey Pushkov, told reporters back in October that the resolution threatened to undermine progress in Russia-EU relations and was the latest example of “anti-Russian activity” spearheaded by Magnitsky’s former employer, William Browder.
Before the arrest in November 2008, Magnitsky worked as a lawyer for the UK-based Hermitage Capital Management Fund. He was detained on charges of tax evasion and was facing trial in Russia on numerous corruption charges. The 37-year-old died several months later in a pre-trial detention center.
Two forensic evaluations showed that Magnitsky died of acute heart failure. Experts confirmed that he was suffering from heart problems, but that it was not at an acute stage.
His family and colleagues claim he was deliberately denied medical help. Two prison doctors have been charged with negligence during the ongoing investigation.
Magnitsky said the criminal case against him was retaliation for his testimony, in which he allged the involvement of law enforcement officials in the embezzlement of budget funds. The company he worked for announced after his death that the case against the lawyer was made up because he had uncovered a multi-million-dollar corruption scheme involving high-ranking state officials.