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The Globe and Mail’s interview with Dmitry Firtash in Vienna included a bodyguard, lawyer and various PR officials.HERWIG PRAMMER/The Globe and Mail

At about 8 p.m. on March 12, Ukrainian oligarch Dmitry Firtash left the offices of his family holding company in central Vienna with several colleagues and his usual small army of beefy security guards. Only moments later, he would become, in his view, an instant "victim" of the power struggle in Ukraine between the United States and Russia.

As he stepped onto the street, Mr. Firtash was arrested by Austrian police at the request of the FBI. In an indictment sealed in 2013 and unsealed on April 2, he had been charged with corruption and involvement in a criminal enterprise by a U.S. grand jury.

Without putting up a fuss, he was hauled into a police station and, two hours later, delivered to a detention centre. His release came nine days later, when he posted bail of €125-million ($190-million) by wire transfer – an Austrian judicial system record. Now he cannot leave Austria.

"The reason for my detention was without foundation as I believe strongly that the motivation was purely political," he said a few days after his arrest.

The arrest marked a grim reversal for Mr. Firtash, who was, until only a couple of months ago, one of the most powerful men in Ukraine and an ally of former president Viktor Yanukovych. Mr. Firtash made his fortune trading natural gas and was a big player in Mr. Yanukovych's political party, known as the Party of Regions. When Mr. Yanukovych fled in February after months of often violent protests, Mr. Firtash and other oligarchs became personae non gratae in Kiev. The interim government alleged that some of them siphoned billions of dollars from the country. Mr. Firtash said he did no such thing.

The American allegations against Mr. Firtash and five co-defendants apparently had little to do with Ukraine – the case centres on $18.5-million (U.S) in bribes allegedly paid in India to try to secure the rights to a mining project. But commentators were quick to speculate that the timing of the arrest could not be entirely coincidental. He had been nabbed four days before the pro-Russia referendum in Crimea, a move that triggered U.S. and European Union sanctions against some 30 individual Russians and pro-Russian Ukrainians for what was described as their role in threatening the security and borders of Ukraine.

Mr. Firtash, a natural gas trader reportedly worth anywhere between $500-million and $10-billion or more, was not on the sanctions list. But he had been close to both Russian natural gas giant Gazprom, whose gas contract dispute with Ukraine has turned ugly and threatens to impoverish the country, and to Mr. Yanukovych, who fled to Russia in February after protests in Kiev turned into a bloodbath, killing at least 79 and injuring more than 500 (the interim Ukrainian government has accused Mr. Yanukovych of mass murder).

Timothy Ash, a Standard Bank analyst, called the arrest of Mr. Firtash a "seismic event" that could have repercussions for the oligarchs who are close to Russian President Vladimir Putin and his cronies at the Kremlin. "I think this sends a strong message to former Soviet Union oligarchs that … if they are to do business in or with the West, they need to comply with some basic Western values," he said. " I also think that it sends a strong message to Russia that the West is willing to go down the financial sanctions route, unless it backtracks over Crimea and over broader policy towards Ukraine."

Mr. Putin did not backtrack on Crimea and Mr. Firtash faces extradition to the United States, which, inconveniently for Mr. Firtash, has an extradition treaty with Austria. Since his arrest, he has been busy proclaiming his innocence, protecting his businesses in Ukraine, where he claims to be the biggest private employer, with 100,000 workers, arguing that his entrepreneurial leadership is essential to Ukraine's economic recovery and trying to distance himself from the hated Mr. Yanukovych.

He has also been ramping up his war of words with Yulia Tymoshenko, the former Ukrainian prime minister who is running in the presidential race scheduled for May 25. Mr. Firtash blames her for much of his woes, insisting that she is bent on destroying him, to the point he suspects she had some influence in the timing of his arrest. "Tymoshenko became a serious opponent towards independent gas traders in Ukraine and started a very big war against me, telling people I was a middleman, that I wanted to harm Ukraine," Mr. Firtash said in an interview with The Globe and Mail in Vienna on Monday.

She did more than that. She once accused him of being in a secret partnership with the notorious Ukrainian-born, Russian mobster Semion Mogilevich, who is on the FBI's "10 Most Wanted" list. Ripped-off Canadian investors will remember him as the dark force behind the Toronto Stock Exchange's YBM Magnex, which claimed to make magnets and did not, earning him, in 2003, a pile of U.S. Justice Department indictments for fraud, racketeering, money laundering and other forms of misbehaviour.

The evolution of a trader

Mr. Firtash has seen happier days. He may still be a billionaire but he stands to lose it all if he goes to trial in the United States, and he can't count on his vanishing cohort of allies in Ukraine, among them Mr. Yanukovych, to provide him with cover. "Firtash is a man with a dreadful reputation," said Taras Berezovets, a political analyst who runs the Kiev think tank Politech. "He is known as the man who supported the regime of Yanukovych."

Dmitry Firtash does not travel light. The cast of characters in support of his interview with The Globe and Mail, held at the offices of a Vienna communications firm, included a bodyguard; his lawyer; a London PR man flown in for the occasion; the Kiev communications man for Group DF, the umbrella company for his Ukrainian and international businesses; the head of Inter Media Group, his TV company in Ukraine; and Robert Shetler-Jones, the Briton who was chief executive officer of Group DF until 2012 and is now its deputy chairman.

Fluent in Russian, Mr. Shetler-Jones acted as Mr. Firtash's interpreter during the meeting. Not present, except by phone to clear up a misunderstanding about the conditions of the interview, was Lord Tim Bell, the London PR guru who helped to steer Margaret Thatcher to three general election victories. Evidently, Mr. Firtash still has a lot of money to spend.

Mr. Firtash is tall, slim and well groomed, with salt and pepper hair and a carefully manicured beard of maybe five days' growth. He wore a light blue shirt – no tie – light blue blazer and grey pants of obvious high quality.

For a man of such power and formidable reputation, his voice is surprisingly soft. He spoke at a measured pace and liked to answer his own questions. "Why did this happen? Let me explain …" he would say. He has three children, one from his first wife, two from his second and current wife, Lada, who is chairman of the Firtash Foundation, which runs the family charities. They are – or at least were until his arrest – regulars in the London social scene and own a house near Harrod's, in Knightsbridge, complete with underground pool.

Mr. Firtash's rise to the top of Ukraine's oligarch heap is remarkable when you consider he came from nothing, admits he was an academic underachiever and didn't get his big break as a gas trader until fairly late in his career. But he took outsized risks that occasionally paid off, had an instinct for business and was skilled at forming relationships. "I always had a feeling about people," he said.

Mr. Firtash was born in the town of Sinkiv, in western Ukraine (the largely non-Russian-speaking part of the country). The son of a truck driver and an accountant who worked in a sugar refinery, young Dmitry was expected to do what other Soviet-era boys did, which was to attend the schools assigned to them, join the military and then work in a collective farm or hellish factory. The only unusual feature of his youth was his work in the family greenhouse, a sort of off-the-books operation that brought in a few extra kopecks and gave Dmitry an early taste for business.

He attended Krasnolimansk Railway Vocational School and learned how to drive steam trains. "I was middling in my abilities at school," he said. "When I tell people I was a train driver, they laugh. I know how to throw coal into a boiler."

Then it was off to the military, after which he joined the fire brigade in his home town, got married, had a kid and realized he would face a life of near poverty unless he boosted his income. As luck would have it, the political and economic reforms under perestroika in the mid-1980s, and the collapse of the Soviet Union a few years later, meant a capitalism free-for-all was about to be unleashed. Mr. Firtash became a trader, selling everything from bed sheets to dried fruit. With a partner, he once made a small fortune by selling dried milk to Uzbekistan and taking cotton in return. "My job was to ensure the cotton got to the port of Odessa, then was sold into Europe," he said. "I made on the deal somewhere between $200,000 and $250,000. I was 24."

Hooked on trading, he moved to Moscow, which was operating as an enormous souk at the time as representatives of the former Soviet republics came to town to barter and beg for life's essential products. His big break came when he based himself in the Rossiya hotel, Europe's biggest hotel until it was demolished in 2006. Located near Red Square, it was the city's deal-making hub. There, he met a trade official from Turkmenistan. The country desperately needed food and Mr. Firtash raised money from acquaintances (some of whom are now famous oligarchs, he said) and delivered enough flour, oils and other products to fill entire warehouses. But the bill went unpaid for three months and his backers were getting surly. So he flew to Ashgabat and learned the government had no money. "The only product I could take in return was gas," Mr. Firtash said. "It was effectively a barter trade. … Eventually, we contracted for almost the entire volume of central Asian gas."

Rather suddenly, Mr. Firtash found himself in the unlikely role of gas tycoon. From the late-1990s, he was supplying Ukraine with almost all its imported gas, some of which was in turn sold into European spot markets, where he earned fortunes. In 2004, Mr. Firtash formed a joint venture in Switzerland with Russia's Gazprom called RosUkrEnergo (RUE). The deal: Gazprom would get access to central Asian gas and the Ukrainian market and Mr. Firtash would gain access to Gazprom's pipeline network, which extended into Europe. "Gazprom made no investment in the [joint venture] but got in return an awful lot," he said.

Hints of criminal connections

This is where Mr. Firtash's often murky investments became even murkier. While RUE was ostensibly more or less an equal joint venture, more than a few officials in the Ukrainian government believed the true power behind it was not Mr. Firtash, but Mr. Mogilevich, the mob boss. In 2005, Oleksandr Turchynov, now acting president, then head of Ukraine's secret service, the SBU, told the Financial Times that "The name Mogilevich isn't in the [gas trade] agreements or the ownership documents but there are many indications that a group of people under his control could be involved."

Ms. Tymoshenko, the former prime minister, made the same accusation a year later on BBC's Panorama program. Mr. Firtash denies the allegations. "He was not involved in the business and not associated with the business," he said.

But a curious and widely reported story, first published by Wikileaks in 2010, suggested that Mr. Firtash did have some sort of relationship with Mr. Mogilevich. In 2008, Mr. Firtash requested a meeting with Gordon Taylor, then the U.S. ambassador in Ukraine. A cable sent to the U.S. State Department after the meeting stated: "Firtash's bottom line was that he did not deny having links to those associated with organized crime. Instead, he argued that he was forced into dealing with organized crime members, including Mogilevich, or he would never have been able to build a business."

Mr. Shetler-Jones, Mr. Firtash's deputy chairman, confirmed that the meeting with the ambassador did happen, and that Mr. Firtash did on one occasion meet Mr. Mogilevich. "But the comments [reported in the cable] in reference to Mogilevich were not made by Dmitry Firtash," he said.

In 2009, RUE's Ukrainian gas import monopoly vanished when the Ukrainian government, then led by president Viktor Yushchenko, predecessor to the ousted Mr. Yanukovych, rewrote the gas import script and handed the market to Russia's Gazprom.

Mr. Firtash thinks Ms. Tymoshenko was the driving force behind RUE's banishment and argues that Ukraine is the poorer for it because Gazprom is charging Ukraine higher prices than RUE did (a new gas war has just broken out between Russia and Ukraine, with Russia demanding the end of discounts and arrears payments of more than $2-billion). "I cannot prove what I am saying, but she created a situation where Ukraine is completely dependent on Russian gas with no alternative to go to a different market and we have all these problems. Immediately after this, the Ukrainian budget began to shudder."

He thinks the Kremlin is expertly using its control of the Ukrainian gas supply to exert pressure on Kiev as tensions rise in Eastern Ukraine, where pro-Russian and pro-Ukraine forces were clashing this week. "Russia needed geopolitical influence in Ukraine," he said. "And when Ukraine doesn't have debts and doesn't have problems, and when the economy is working normally, it is impossible for Russia to influence Ukraine. There are no weak points. So they had to create a scenario [to weaken Ukraine] through the price of gas."

It appears, however, that Mr. Firtash's empire – whose sales, he says, reached $6-billion in 2012 – largely survived Gazprom's takeover of the Ukraine gas market in 2009. He still traded gas inside Ukraine and expanded into banking, media, real estate, titanium, chemicals and fertilizer. His connections obviously proved fruitful. Mr. Firtash has a close relationship with Sergey Levochkin, who was chief of staff in the administration of Mr. Yanukovych. Last year, Mr. Firtash and Mr. Levochkin purchased Ukraine's Inter Media Group, the broadcaster that owns one of the country's main TV networks.

Mr. Firtash faces an uncertain future in spite of his vast holdings and wealth. He could get extradited, in which case all bets on the health of his empire are off. While he has distanced himself from Mr. Yanukovych, and insists he supported his removal from the president's office, Ukrainians still associate him with the kleptomaniac strongman.

He says he still has full control over his Ukrainian businesses, and that the jobs they create, and taxes they pay, will play a big role in the sustainability of Ukraine after the May elections. He believes that Ukraine, under a strong elected government, can act as a "neutral state that is a bridge between Russia and Europe." In the presidential elections, he is backing Petro Poroshenko, who owns the confectionery company Roshen and is known as the "chocolate king." Smart move – Mr. Poroshenko is ahead in the polls.

Mr. Firtash obviously hopes that Mr. Poroshenko, should he win, will highlight his role as a big employer and the president of Ukraine's Federation of Employers. "I think I am one of those people who can be quite useful, to put it mildly, in the resolution of the country's problems."

The problem is that Mr. Firtash has lost a lot of his allies in Kiev and Moscow. The next chapters in the oligarch's story are unlikely to be as rousing, or as lucrative, as the first ones and may end in a lengthy prison sentence.

For her part, Ms. Tymoshenko isn't shedding any tears about her old foe's woes. In an interview published April 13 in Austria's Die Presse, she was asked how she felt about Mr. Firtash's arrest. "That there is justice that prevails – sometimes earlier, sometimes later," she said.

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