Investigations

21 April 2023

A corrupt knight. Empire of Lukashenko-linked entrepreneur Zaytsev uses priest as business owners

The Belarusian entrepreneur is the first member of the Order of St Gregory the Great in the history of Belarus.

Businessman Alexander Zaytsev, who is close to Viktor Lukashenko (Viktar Lukashenka), is building huge companies and registering them using church clergy, among others.

The Belarusian entrepreneur is the first member of the Order of St Gregory the Great in the history of Belarus. It is the highest honor for laymen awarded by the Pope. Our investigation explains how such an honor from the Vatican can be earned, how the interests of the church are mixed with personal benefits for some of the reverend fathers, and how it is paid for by Belarusian taxpayers. 

"Knight’s dignity was his prospect"

"The award has pursued Knight Alexander, the knight’s dignity was his prospect. The members of the Catholic Church must be grateful to you and praise God for having such outstanding people in our blue-eyed homeland in the 21st century," said Archbishop Józef Staniewski, head of the Roman Catholic Church in Belarus, in a speech at the Cathedral of the Blessed Virgin Mary in Minsk in November 2022.

The archbishop was speaking of Zaytsev, who fell under the EU and US sanctions as a person linked to Lukashenko. The speech was delivered at a ceremony where Zaytsev was initiated into the third highest Papal Order. Two priests, Ihar Lachouk and Yury Zheharyn, were also present at the event.

Award of the Order of St Gregory the Great to Alexander Zaytsev (from left to right: Alexander Zaytsev, Catholic Priest Ihar Lachouk, Catholic Priest Yury Zheharyn and the head of the Roman Catholic Church in Belarus, Archbishop Józef Staniewski)
Source: Christian Vision / November 2022: Award of the Order of St Gregory the Great to Alexander Zaytsev (from left to right: Alexander Zaytsev, Catholic Priest Ihar Lachouk, Catholic Priest Yury Zheharyn and the head of the Roman Catholic Church in Belarus, Archbishop Józef Staniewski)

Why Zaytsev received the Catholic Order was not specified at the ceremony, but various publications suggest that he made a donation for the construction and reconstruction of Belarusian churches.

"I have known Mister Zaytsev for years. His faith built up incrementally. Not only did he grow in his faith personally, but he also spread and expanded the faith of the Catholic Church here in Belarus," said the Catholic priest Lashuk at the ceremony.

Our investigation revealed that as well as helping Zaytsev to strengthen his faith, Lashuk is also running his smuggling business to evade sanctions.

The Lord gives his blessing

In September 2021, Lashuk, a Catholic priest, founded a company called ALIS MA. The sanctioned owners of the Bremino Group transferred some of their property to this company.

We asked Yury Sanko, press secretary to the head of the Roman Catholic Church in Belarus, whether a priest can engage in business.

"Our mission is ministry. A priest can neither be a member of political parties, nor engage in business. It is impossible under canon law. Such a claim is extremely confusing even for us. Therefore, we will also try to look into it," Sanko told us during a telephone conversation.

We've also sent an official request for comment to the Vatican press service and to the Vatican Ambassador to Belarus. We are waiting for their response.

Bremino Orsha is an “island” of almost total tax exemption, created by a decree of Aleksandr Lukashenko for companies owned by businessmen loyal to him. It has been used to smuggle flowers, fabrics, and foodstuffs from Europe to Russia, and we have repeatedly told about these schemes.

A significant amount of official transit through Belarus uses Bremino or its affiliates. The company got permission to build its warehouses with customs clearance at the Bruzhi and Berastavitsa border checkpoints. This is where the recoupling from European to Belarusian semi-trailers happens. These are the only private customs clearance points on the EU-Belarus border, so truck drivers entering Belarus via Berastavitsa or Bruzhi have no choice but to use the services of Bremino.

These customs checkpoint points have come under the control of Vlate Logistik, a Bremino Group company. Formerly owned directly by the Bremino Group, it has now been transferred to six individuals, most of whom represent one of the three real owners. As a result, the sanctions on Bruzhi and Berastavitsa have been lifted.

These customs centres are making huge profits due to lack of competition. But the company's profits look very low. The standard rate of return in the industry is around 20%. Vlate shows half that, even though it is a monopolist on two border sections. They pay hardly any tax on these profits, thanks to favours granted to them personally by Lukashenko. At the same time, a significant percentage of the company's income is spent on "other payments", and the net profit rarely exceeds 20 million Belarusian rubles (about $US 7.5 million). 

Bremino should have to pay tens of millions more rubles in taxes for its border monopoly. This money would be enough to fully equip one health centre.

Zaytsev is a key figure in Bremino. In other deals, he’s one of a trio of businessmen who, while attempting to avoid sanctions, divided their shares equally among a few loyal individuals. But in Bremino Orsha, everything was transferred to Zaytsev's confidant, the priest Lashuk, and the ALIS MA company founded by Lashuk.

Reports show that ALIS MA ended the year 2022 with a loss of 2.6 million Belarusian rubles (about $US 1 million).

This may have something to do with our investigation into an offshore flower business. After it was published, Russian authorities shut down or at least considerably cut down the flower trade.

The net losses are also due to significant investment spending in affiliated companies, such as RuzSpedition and Vlate Logistik, for the construction of a logistics center and other infrastructure.

We asked Lashuk how he suddenly came to own a company linked to Bremino. We did not get a clear answer.

"This is my personal matter. I am a priest. There are some questions I don't answer, not even if the Pope asks me, you know? Some questions are just between me and God," Lashuk told us in a telephone conversation.

From private sector to civil servant — and back again

Zaytsev partly described his journey to big business and knighthood on his website. He stated that he graduated from the State Economic Institute in 1997 and had worked in the private sector as well as in some independent Belarusian mass media — Belorussky Rynok, Belorusskaya Delovaya Gazeta and Delo magazine. He also worked for both the Ministry of Economy and the European Humanities University. Thanks to the CyberPartisans hacker group, we learned that Zaytsev worked in the Council of Ministers beginning in December 2003. He acted as an assistant and advisor to Prime Minister Sergei Sidorsky.

In 2007, Zaytsev joined the State Secretariat of the Security Council. At the end of 2012, he left the Security Council and engaged in big business. However, his resignation did not mean the end of his travels with Viktor Lukashenko.

Data from the Passport Automated System; provided by CyberPartisans
Source: Data from the Passport Automated System; provided by CyberPartisans

With the assistance of CyberPartisans, we found out that while working in the Security Council, Zaytsev constantly accompanied Lukashenko on trips abroad.

For example, on a flight to Abu Dhabi in September 2010. Lukashenko, Zaytsev, then "arms baron" Vladimir Peftiev (Uladzimir Peftsijeu), Deputy Foreign Minister Siarhei Aleinik, and head of the Military-Industrial Committee Sergei Gurulev were on board. They flew on a plane associated with Russian billionaire Mikhail Gutseriev.

Data from the Passenger Traffic Automated System; provided by CyberPartisans
Source: Data from the Passenger Traffic Automated System; provided by CyberPartisans

One month later, Zaytsev and Lukashenko headed to Oman.

Data from the Passenger Traffic Automated System; provided by CyberPartisans
Source: Data from the Passenger Traffic Automated System; provided by CyberPartisans

A month later, they flew together again to Abu Dhabi. That time, they were accompanied by the former Ambassador of Belarus to the UAE, Vladimir Sulimsky.

Data from the Passenger Traffic Automated System; provided by CyberPartisans
Source: Data from the Passenger Traffic Automated System; provided by CyberPartisans

Zaytsev was on flights from Qatar in 2011 and to Turkey in 2012, accompanied by Lukashenko's entire family.

Data from the Passenger Traffic Automated System; provided by CyberPartisans
Source: Data from the Passenger Traffic Automated System; provided by CyberPartisans
Data from the Passenger Traffic Automated System; provided by CyberPartisans
Source: Data from the Passenger Traffic Automated System; provided by CyberPartisans

We have learned from CyberPartisans that Zaytsev often traveled with Lukashenko's retinue, including businessmen Pavel Topouzidis, Vladimir Peftiev and Mikalai Varabei.

Data from the Passenger Traffic Automated System; provided by CyberPartisans
Source: Data from the Passenger Traffic Automated System; provided by CyberPartisans
Data from the Passenger Traffic Automated System; provided by CyberPartisans
Source: Data from the Passenger Traffic Automated System; provided by CyberPartisans
Data from the Passenger Traffic Automated System; provided by CyberPartisans
Source: Data from the Passenger Traffic Automated System; provided by CyberPartisans

In 2021, having come under EU sanctions, Zaytsev decided to challenge them. He claimed that he had never been an assistant to Lukashenko.

Wood, fertilisers, space

Since 2013, according to CyberPartisans, Zaytsev has been involved in establishing or co-owning about three dozen companies.

In January 2013, the Stiskho agriculture company was founded. In 2022, it joins Bremino Orsha SEZ with plans to open a meat production facility. Through this company, Zaytsev was a co-owner of Vlate Logistik, Sohra and other firms.

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The company's revenue in 2022 rose sharply to 25 million Belarusian rubles (about $US 9,5 million) and its net profit to 650,000 Belarusian rubles (about $US 250,000).

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Another company, SM Industrial Engineering, was set up jointly with businessman Milutin Smiljkovic, who is linked to Dmitry and Anna Lukashenko’s, one of the president’s sons and his wife. The company was engaged in woodworking.

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In November 2013, Zaytsev and Varabei founded Bremino Group, which became their main company. In April 2014, Aliaksei Aleksin (Alexei Oleksin) joined them.

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In October 2014, Sohra, a group of companies and Zaytsev's main asset, is established. In the same year, Sohra Overseas is founded in the United Arab Emirates to supply Belarusian machinery, fertilisers and mining equipment.

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In 2014, Zaytsev’s business portfolio is reinforced by Vlate Logistik, which traded in sanctioned goods and has now taken over the management of the Bruzhi and Berastavitsa TLCs, after Bremino was hit by sanctions.

More companies were set up, including IT firm Cyber Genesis, TOD-Invest, a pasta supplier to major retail chains, and Belkosmos Space Agency.

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Thanks to the activists of Rabochy Rukh (Workers' Movement) we have learned that Zaytsev's company Belkosmos, which is not subject to sanctions, tried to negotiate with the logistics company World Atlantic Ghana for the delivery of five tonnes of unidentified cargo from Ghana to the Belarus airfield Balbasava. It should be noted that Ghana has a company linked to Sohra, which is involved in gold mining.

Document provided by the Rabochy Rukh initiative group
Source: Document provided by the Rabochy Rukh initiative group

In a letter, Belkosmos is frank: since Sohra and Zaytsev are under sanctions, payment will be difficult, and Belkosmos offers to deliver some goods to Balbasava for cash.

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Hot weapons – cold calculation

While still a member of the Security Council, Zaytsev repeatedly went on trips with "arms baron" Vladimir Peftiev. Lukashenko was on some of these trips.

In 2016, together with Varabei, Zaytsev founded ZSPZ Arsenal, a private company that sells hunting weapons and accessories. They own the Krasny Bor gun shop.

Shortly before, Zaytsev, through TEMO, became co-owner of BSVT-Novye Tekhnologii, which manufactures small arms and optics and upgrades military equipment. In 2019, Orshansky Patronny Zavod was incorporated into the firm. In March 2021, the company's name changed to Kidma Tech.

Until 2021, Latvian Marks Blats, a member of arms dealer Igor Zimenkov's large network, was Zaytsev's business partner. According to the U.S. Treasury Department, Zimenkov supported the Belarusian defence industry after the imposition of sanctions "by facilitating the sanctioned Belarusian defense entity Belspetsvneshtekhnika (BSVT)'s sales efforts in Latin America." Until 2021, Belspetsvneshtekhnika co-owned Kidma Tech together with Sohra Overseas (UAE) and, therefore, Zaytsev.

Sohra (Belarus) is engaged in extraction of outstanding natural resources in multiple countries including those that buy arms from Belarus. Permission for this extraction is arranged personally by Aleksandr Lukashenko. Take Sudan, for example, one of the biggest buyers of Belarusian arms. In 2018, Lukashenka personally thanked the ruler of Sudan at the time, Omar al-Bashir, for allowing Belarus to mine for gold there.

“Belarusian companies will mine gold on your territory, your depths are very rich in this metal. I am grateful to you for your decision to let us operate a second gold deposit," said Aleksandr Lukashenko.

However, gold was not mined there by Belarus, but by the Emirati offshore company Sohra Mining, linked to Zaytsev.

Knight and Taleteller

Zaytsev's personal life is also rather convoluted. He got married in 2002. He divorced in 2011, but interestingly, in the passport database, he is registered as single. The database contains no evidence that he was ever married at all.

The divorce was a sham, and Zaytsev now lives with his — officially — ex-wife and son in a private house in Barauliany. She is Volha Hramyka, a writer and author of humorous fantasy books.

Data from the Passport Automated System; provided by CyberPartisans
Source: Data from the Passport Automated System; provided by CyberPartisans
Data from the Passport Automated System; provided by CyberPartisans
Source: Data from the Passport Automated System; provided by CyberPartisans

Volha has been running a blog for many years. Zaytsev is mentioned there as Sashiy. In the blog, Hramyka has a reference to her fictitious divorce.

"We formally divorced due to some circumstances in our lives [...] My husband had to stand up and read out a list of his 'sins', which he had shamelessly copied from a friend's divorce statement while preparing the paperwork. [...] There was the failure to fulfill marital duties, neglect of kids, lack of warmth and affection, and financial insolvency," Hramyka wrote.

The woman often shares stories from her life on the blog. In a post, she described an episode of her husband's work in the Security Council.

"About five years ago, when Sashiy worked for a significant and respected organisation, his boss suddenly expressed a need to get a cat. Not just any cat, but an extra-class red Maine Coon, a gift for his wife and children. [...] The breeder, overwhelmed by the sudden opportunity, sold the cat to the new owner along with all the cat's gadgets. [...] The pet was handed over to the new owner with all his belongings, and then the fun began. [...] When a Jeep with blacked-out windows pulled up in front of the vet's office and the guards resembling combat cyborgs secured the perimeter and brought the cat on a velvet tassel pillow, he was not the only one who felt a twinge of fright. [...] The vets looked at the stern faces of the cyborgs and realised that if this particular cat had a 0.01% chance of dying, they wouldn't get out of the clinic alive either," Zaytsev's wife described.

Volha Hramyka does not say much about who her husband is and goes by her maiden name.

"The writer's husband's name is Alexander, he is a Belarusian politician and advises Volha who to vote for during elections," reads Zaytsev's description on a writer's fansite.

Volha owned a company in the UK called Cyborg Protection Union beginning in 2018. The company was set up to publish Volha's books in English, but judging from just two books published, business did not go well and the company was liquidated in 2022.

The Zaytsev family lives in Barauliany, where they have a private house. It is not their only property. As we found out with the help of CyberPartisans, Zaytsev has a manor in the village of Karouchyna, Bykhau District.

He also owns a flat in Minsk, a house in the village of Chachevichy, and another house in his native Ruzhany.

We would like to thank CyberPartisans for their help in this research.

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