Wednesday, September 28, 2005


Platon met Maria in Crimea, at the Yalta Hotel, where a conference on optimization methods was taking place. Along with the conference participants, also staying at the hotel were either Moscow or Leningrad music hall dancers, two cycling teams, and a small number of individuals who were there without any purpose - but definitely thanks to their connections [po blatu], as there existed no other way for anyone to get into the Yalta Hotel.

Platon's prototype is Boris Berezovsky; this passage is from Yuli Dubov's 2002 novel, Bolshaya Payka (The Big Ration), a thinly veiled story of Berezovsky's evolution from a more or less average research institute guy to the monster he is today. A very interesting book.

I read it at the end of 2002 and found this Yalta Hotel passage somewhat of a revelation.

With our tennis team, we used to go to Yalta twice a year, for three weeks in early spring and two weeks in the fall. Both seasons the weather was - already or still - warm enough to play, and there were few tourists around, so Yalta felt nothing like the hell it always became in summertime. And we stayed at the Yalta Hotel regularly.

It wasn't a completely ordinary thing: a bunch of tennis-playing kids - nothing special, not an Olympic team or something - living in a hotel most people weren't even allowed to enter. But I used to take it for granted, mainly because there was a lot more to Yalta than the Yalta Hotel, and a lot more to the hotel than its relative inaccessibility.

Trying to imagine Berezovsky unable to get himself a room there - or Berezovsky forced to spend even a moment thinking about such a possibility - was overwhelming, and very amusing. He was so much like us then, so much like everyone else - if only everone else's fortunes and status had changed to the same extent as his over the past 20 years! He's so rich and so high above it all now - but back then, just like everyone else, he probably had to stay on the 14th or 15th floor of the Yalta Hotel, the two upper floors reserved specifically for Soviet citizens, a ghetto of sorts...


Our own blat, the pass to places like the Yalta Hotel, were kids from the well-connected families: boys like Sergei Pereloma, for example, whose father was a close associate of Vladimir Shcherbitsky, the Communist czar of Ukraine from 1972 to 1989.

Sergei was two years my senior, had a beautiful face and wasn't very athletic. He was very smart, though. Shrewd.

Sometime in 1983 or 1984, in between tennis and at the Yalta Hotel, he managed to hook us on a game he called Business, a very rough imitation of Monopoly. Using a book as a ruler, Sergei divided an A4 paper sheet into 60 or so little squares, then filled most of them with Western company names, drew their logos or product pictures, and scribbled prices underneath each one, in tens of thousands of U.S. dollars. The game had banks full of fat money sacks, jails with barred windows, and the really evil-looking robbers - but there were no community chests or taxes.

We played Business all the time during that Yalta trip - in fact, we played it more than we played tennis. On our return to Kyiv, I got many of my non-tennis friends addicted as well. We played so much we had to create a new sheet weekly - and how I wish I had kept at least one of them!

Nothing seemed strange about the game then, not until 2002, when it occured to me that Sergei's knowledge hadn't been all that common for a 12-year-old, pre-perestroika Soviet kid.

In the early 1980s, both the word 'business' (biznes) and the process it signified were nothing but exotic; 'monopoly' was a term out of a Marxist theory text, not a board game (Monopol'ka) with those awesome, real-looking paper money bills; possession of foreign currency was a criminal offense; ads did not exist, nor did brand-name stores, and to know much beyond Adidas and Pepsi was a secret priviledge of the caste Sergei's father belonged to.


Thinking of all this in 2002, I began to wonder what became of Sergei Pereloma. I ended up googling his name, of course.

His face wasn't beautiful anymore, but otherwise he was doing very well. After obtaining a degree in international economics and working for state and private investment, banking and insurance companies, Sergei was appointed financial director of the not-yet-privatized Kryvorizhstal in 2000, at the age of 28. Two years later, in March 2002, he became acting CEO at Ukrtatnafta, a joint Ukrainian-Tatar oil processing plant, the largest in Ukraine.

Impressive, isn't it? And not surprising at all: Sergei was quite brainy even as a kid, and though his father's connections and Communist Party resources must have served as a terrific launching pad for his career, they couldn't have been the only decisive factors. After all, Vladimir Shcherbitsky's grandson Vova managed to get himself drafted into the army in the early 1990s - and that was it, as far as I know, despite all the family connections and resources once available to him.

For the next three years, I occasionally used Sergei's example to illustrate how the labels have changed since the collapse of the Soviet Union, but the names haven't - and how, at a closer look, everything turned out to be so much more complex.

Then, ten days ago, something suddenly reminded me of Sergei as I was reading the transcript of Oleksandr Turchynov's press conference, and I decided to google him up again. (I still can't quite figure out what got me thinking of him this time.)

He's still doing very well. After Ukraine's State Property Fund lost control over Ukrtatnafta to Tatneft and Tatarstan's government in early 2003, Sergei returned to Kryvorizhstal as financial director. He was there in summer 2004, during the company's disgraceful privatization.

After Yushchenko won the election, however, Sergei very quickly found himself near the top of Naftogaz Ukrainy, a state-owned oil and gas company: in late February 2005, he was appointed acting first deputy of the company's head, Yuri Boiko; a month later, he was confirmed in this position, though his boss was by then a different person, Oleksiy Ivchenko (hopefully, just a namesake of Valery Ivchenko, the corrupt guy asserting pressure on the courts, mentioned by Turchynov).


It's tempting to believe that Sergei Pereloma's invaluable finance skills make him a man of his own - but, unfortunately, politics is never too far away.

Sergei was once known as Oleg Dubina's protege; Oleg Dubina, in his turn, served as head of Kryvorizhstal from 1999 to 2001, until being moved to replace Yulia Tymoshenko as vice prime minister in Victor Yushchenko's government, under Kuchma.

Here's what the Halytski Kontrakty weekly wrote (in Ukrainian) about Dubina in January 2001, shortly after his appointment as vice premier:

The premier [Yushchenko] is trying to convince the public that Dubina is his candidate alone. The oppositional Internet publication Ukrainska Pravda considers the new vice premier to be under strong personal influence of Leonid Kuchma. Yulia Tymoshenko's allies claim the opposite: "According to some information, Victor Pinchuk has had a hand in Oleg Dubina's appointment. And this can affect his work in the government," said [...] Artur Bilous, a parliamentarian from [Tymoshenko's] Bat'kivshchyna faction.

This Dubina-Pereloma Connection farce is further complicated by Sergei's alleged/imaginary closeness to Yushchenko. Here's what Ukrainska Pravda wrote (in Ukrainian, reprinted in Obozrevatel) in late June 2005, when Sergei became head of the supervisory council of Ukrnafta, an oil company integrated into the structure of Naftogaz Ukrainy:

In early 2000, Pereloma was the financial director at Kryvorizhstal, then headed by Oleg Dubina; later, he worked at Ukrtatnafta; he returned to Kryvorizhstal when the company was owned by Pinchuk and Akhmetov. This may lead one to believe that the new head of the supervisory council [Pereloma] is connected with Dubina. But in reality, Pereloma's earlier biography demonstrates his connection with Oleksandr Morozov, a parliamentarian from Yushchenko's circle.

Pereloma worked at Prominvestbank, Derzhinvest of Ukraine, and Oranta insurance company, at the very same time Morozov was involved in these structures. Taking into account the friendship between Morozov, Tretyakov and Mykola Martynenko, head of Nasha Ukraina faction, and their proximity to Yushchenko, it appears that the person who'll be watching over the finances of Ukrnafta [Pereloma] is someone who enjoys the president's trust.

This is all so nonsensical and confusing that at some point it seems logical to ask this question: and whose man is Yushchenko himself?

One way or another, would it really matter, though? I mean, really...


I'm not sure what point I'm trying to make in this entry. None, I guess.

Or - go figure. That's the best way to sum it up, as always.


Mishah said today: "And imagine if Ukraine were a really small country, like Estonia. You'd probably know every second state official personally, you'd be neighbors with them or something. And perhaps this is why it all works so much better over there - because they all know each other, more or less..."


  1. Veronica, we had a homemade Monopoly-like game back in the '80's in Leningrad also. I thought we were the only ones! This is very interesting - if I have time, I'm going to do a long post about all of the memories this is triggering. Unfortunately, since I was just there for 3 years as a foreign service kid, I lost touch with most of my friends from that time period and don't know what they're up to nowadays. I would bet most on the success of a guy I didn't know very well, but who always offered to buy dollars from me for 10 rubles each (when the official rate was 1 ruble = $1.60!), although I never took him up on the offer. Wow. Let the Soviet-childhood memoirs begin. Thanks for sharing this story.

    09.29.05 - 6:41 am

  2. Hi,

    My name is Laryssa Chreptowsky Reifel and I am Vice Chairman of the Board at the Ukrainian Institute of Modern Art in Chicago.

    We are working on a joint project with the Center For Contemporary Art in Kiev to bring the Orange Revolution Exhibit to Chicago on the anniversary of the revolution.

    The story of the exhibit is a compelling one and I was wondering if you would consider posting our press release on your blog.

    Please email me if you are interested. I can provide you more details.


    09.29.05 - 7:18 am

  3. Lyndon, I do hope you write about it! (And if your story lacks any connection to contemporary politics, that'll make it only better!)

    09.29.05 - 10:49 am

  4. Laryssa, I'll be happy to post your press release here - but I can't email you since you haven't left your address!

    Here's my email, just in case: vkhokhl/at/

    Hope you read this,

    09.29.05 - 10:54 am

  5. Estonia as an example? Maybe things were running better after a short transition period. But there is still Edgar Savisaar one of the famous polticians during the time of the independence movement. Later often called a populist. Had a lot of affairs but turned out to be an Estonian "come back kid".

    09.30.05 - 10:19 am