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Here’s why Ukraine paid Manafort insane amounts of money

by David Gilbert and Greg Walters
Oct 30 2017, 7:43pm

Just as he had done for dictators in the Philippines and Zaire, Paul Manafort found himself in Ukraine in the fall of 2005 to help reshape the public perception of an unpopular, pro-Kremlin political party associated with “oligarchs and mobsters.”

For Manafort, the rewards were obvious. According to the federal grand jury indictment unsealed Monday, some $75 million flowed through offshore accounts linked to Manafort and his consulting company’s work with individuals, businesses, and political parties in Ukraine over the course of nine years.

For pro-Kremlin Ukrainian politicians who had found themselves on the wrong side of a revolution, Manafort promised to be their best shot at a return to power — and an influential go-between with the United States.

A revolution and a strongman

At the time, Viktor Yanukovych looked like a spent force in Ukrainian politics. The Orange Revolution that swept through Ukraine that winter had crushed Yanukovych’s hopes of assuming the presidency and marred his reputation in the West.

“Yanukovych was ruled politically dead by late January 2005.”

In the eyes of many young Ukrainians, especially those in the capital and the western parts of the country, Yanukovych stood for everything that was backwards, corrupt, anti-democratic about their own country. In Western diplomatic circles, he was seen as a hapless tool of Russian President Vladimir Putin, who had sought to install Yanukovych in the presidency to keep Ukraine from moving toward Europe.

After his victory in the November 2004 election was declared fraudulent by the country’s Supreme Court, Yanukovych went on to lose the re-run election months later to his opponent, Orange Revolution leader Viktor Yushchenko.

“Yanukovych was ruled politically dead by late January 2005,” said John E. Herbst, United States ambassador to Ukraine from 2003 to 2006.

But the disgraced leader didn’t slink off into obscurity. Instead, he staged one of the greatest political comebacks in modern political history. And to do it, he hired Paul Manafort.

FILE - In this Tuesday Dec. 17, 2013 file photo, Russian President Vladimir Putin, right, and his Ukrainian counterpart Viktor Yanukovych talk during a news conference in Moscow.(AP Photo/Ivan Sekretarev, file)

Though the sums Yanukovych and his friends paid Manafort may seem astronomical, they may also have been only a small portion of what the notoriously corrupt administration of Viktor Yanukovych had to offer.

“It sounds like a lot of money, but by the standards of the overall graft of the Yanukovych administration, reportedly in the range of $40 billion, it’s a drop in the ocean,” Josh Kovensky, a reporter for the Kyiv Post, told VICE News.

“He realized that his Russian advisers had failed him, and Manafort became his guy,” Herbst said.

The quiet Americans

Manafort was working for a Ukrainian oligarch Rinat Akhmetov when he was introduced to Yanukovych.

Manafort’s firm, Davis Manafort, had produced an analysis of the Orange Revolution that Yanukovych found instructive, according to one report. Manafort also offered another key asset: deep contacts in Washington.

Before turning his attention to controversial world leaders, Manafort had served briefly in the Reagan administration and consulted for George H.W. Bush and Bob Dole, and his connections throughout K Street were legend.

But it was his reputation as an international fixer that proved most applicable to Yanukovych. Manafort had a track record of improving the public reputations of corrupt dictators, like Philippine President Ferdinand Marcos and Zaire’s military strongman Mobutu Sese Seko.

In the fall of 2005, Manafort and Gates quietly opened an office in downtown Kiev, and they quickly went to work.

A 2006 cable to the State Department from U.S. diplomats reported that Yanukovych’s Party of Regions was in the midst of an “extreme makeover,” aided by Manafort and his colleagues.

“Ex-PM Yanukovych’s Party of Regions is working to change its image from that of a haven for mobsters into that of a legitimate political party,” the cable said. Manafort and his team were busy “nipping and tucking” with a goal of ridding the party of its gangster image.

The Manafort-led makeover was profound, even down to Yanukovych’s physical appearance.

“There’s no question that Manafort realized that Yanukovych needed to be presentable to the West.”

Yanukovych tidied up his Soviet-style bouffant hairdo, and began speaking Ukrainian rather than Russian. He pledged to take the country into the European Union. He spoke out about corruption, and began painting himself as a reformed politician who’d left his vote-rigging days behind him.

“Here’s the guy whose team tried to steal the election, and they failed,” Herbst said. “So then Manafort appeared and presented himself to me, saying he was going to help Yanukovych win the old-fashioned way, by out-organizing the opposition.”

Taras Chornovil, Yanukovych’s campaign director, who stalked the halls of their Kiev headquarters during the last days of the Orange Revolution looking pale and distraught, later said that Manafort told Yanukovych’s surrogates to wear makeup and Hugo Boss suits during their television appearances.

When Chornovil complained about Manafort to a close associate of Yanukovych, Chornovil said the man told him Manafort was untouchable — “a big cheese here, in charge of everything,” according to NBC News.

Although he doesn’t speak Ukrainian, Manafort even reportedly penned Yanukovych’s campaign slogan for the 2006 election: “A better life today.”

Manafort helped Yanukovych craft messages that appealed to both Western governments and his own party’s anti-Western base in the country’s eastern regions, Herbst said.

“There’s no question Manafort realized that Yanukovych needed to be presentable to the West, especially after his misbehavior, and the misbehavior of his team, during the revolution,” Herbst said. “But they played on wedge issues to their core voters in the east and south of the country by portraying the United States in a nasty way.”

Manafort’s intervention paid off. By 2006, Yanukovych had risen to become prime minister of Ukraine, while leaders of the Orange Revolution fought with each other.

“He was their face to the West.”

And in 2010, Yanukovych finally achieved what had once seemed impossible: He was elected president of Ukraine in an election deemed free from serious fraud. A team of international observers led by the Organization for Security and Cooperation in Europe declared the vote an “impressive display” of democracy in action, and his main opponent, Orange Revolution stalwart Yulia Tymoshenko, later withdrew her legal challenge to the result.

Observers say Manafort played a central role in Yanukovych’s six-year journey from reject to president as both a top domestic political adviser and a key diplomatic conduit to the Western centers of power.

Yet while Yanukovych’s grand return used many of the traditional tools of Western political stagecraft, as president, he would be accused of returning to his old tendencies.

“Once he won, first slowly, then more quickly, he began to act as an authoritarian,” said Herbst.

Manafort again flexed his muscles on Yanukovych’s behalf, helping to arrange for a prestigious New York law firm to produce a report justifying the jailing of his top political rival, Tymoshenko, on charges her supporters claimed were politically motivated, according to a report in the New York Times — a move Ambassador Herbst called “outrageous.”

“He was the Yanukovych administration’s contact to the West,” Kovensky said. “He was their face to the West.”