borys feldman is the brains behind the sloviansky bank.

for a year feldman has languished in jail, awaiting trial on charges of income tax evasion, misuse of office and misappropriation of collective property.

his zaporozhia-based bank, which set record profits among ukrainian commercial banks for 1998 and 1999, began experiencing problems last march when tax authorities arrested five of its managers, including feldman.

since then, the nbu has suspended sloviansky’s licenses to perform key banking operations and the state tax administration confiscated securities constituting a large proportion of the bank’s assets.

last month the sta said they had proof that yulia tymoshenko, former deputy prime minister for the energy sector, conspired with feldman to steal about $1 billion intended to pay for russian gas.

tymoshenko and feldman say none of the numerous investigations into their companies’ operations have uncovered any evidence of wrongdoing.

both say a corrupt regime is attempting to shut them up, a charge backed up by recently released secret recordings of alleged conversations between president leonid kuchma and state tax administration chief mykola azarov.

this q&a was conducted via correspondence with feldman, who has asked the european court for human rights in strasbourg to overturn rulings by the ukrainian courts.

q. why did authorities go after your bank?

a. the motivation for launching the case against the bank is rather complicated. first, many and varied officials initiated the action against the bank and me. secondly, their desires have changed over time, in accordance to both internal and external circumstances, which have changed over time.audio records of conversations recorded [by former security guard mykhola melnychenko reveal part of the reason authorities went after sloviansky, as do recent statements made by public officials.from the beginning, authorities have tried to portray sloviansky as the wallet or financial instrument of tymoshenko.

the spin was simple: it is necessary to destroy sloviansky in order to deprive tymoshenko of her financial empire.

tax agents had a slightly different aim – to show their readiness to carry out any order to demonstrate who rules the roost.

destroying sloviansky enhanced sta’s prestige and provided a lesson to other banks, which the sta could – and would – act against with impunity.for sloviansky’s business competitors, the objectives were more apparent – access to profitable clients, invested credits, and a way to eliminate an uncompromising competitor.for state officials, our demise represented an opportunity to use sloviansky as the scapegoat for their own sins.

on saturday, feb. 17, mr. marchuk took to the airwaves on national state television [ut-1] and said sloviansky and grado banks were underwriting protest actions in order to avoid prosecution themselves. as for the sta officials, after the liquidation of sloviansky, the goal has become to wash their hands of the matter as quickly as possible.

both tax authorities and employees of the nbu need to endure possible court action and want to escape criminal responsibility for what has been done. they want what happened to sloviansky to be forgotten as quickly as possible. but in order to use the case against sloviansky against tymoshenko, all judges in ukraine would need to be controlled by the authorities.

q. why did the nbu jump on the bandwagon?

a. what motivated the actions of [national bank of ukraine governor volodymr] stelmakh and the nbu vis-a-vis sloviansky can be summed up using one word -fear.

q. what was your bank’s relationship with united energy systems of ukraine and yulia tymoshenko?

a. sloviansky bank was formed in 1989.

i became a shareholder five years later. in 1995, i made the acquaintance of yulia tymoshenko of united energy systems of ukraine (uesu). earlier, in 1992 and 1993, i had met her casually on a few occasions. our relationship was on the level of “hello” and “goodbye.”