In a significant ruling that underscores the importance of compliance with court orders, Sergiy Groza and Volodymyr Naumenko, the former ultimate beneficial owners of Ukrainian import-export business GN Terminal Enterprises (GNT), have been sentenced to 21 months in prison by Mr. Justice Bryan of the English High Court. The sentencing, which took place on October 4, 2024, follows a finding of contempt of court for the businessmen’s failure to comply with a worldwide freezing order (WFO) and subsequent asset disclosure order.
The case stems from a US$118 million WFO placed on Groza and Naumenko’s assets in January 2023, obtained by Madison Pacific Trust Limited on behalf of GNT’s secured lenders, Argentem Creek Partners (ACP) and Innovatus Capital Partners. The WFO was upheld in February 2024 after an unsuccessful challenge by the defendants. In April 2024, an additional disclosure order was issued to ensure compliance with the WFO, requiring Groza and Naumenko to provide detailed information about US$97 million in dividends received over a decade, nominees holding their assets, and the funding of their legal fees.
The defendants’ active refusal to comply with the disclosure order led to the committal hearing on August 30, where they were found in contempt of court. During the sentencing hearing, Groza attended remotely but remained silent when given the opportunity to speak in his defense, despite the provision of a Ukrainian translator. Naumenko did not appear at all. Mr. Justice Bryan issued warrants of committal for both men, meaning they will face arrest upon entering the United Kingdom.
This case highlights the severe consequences of non-compliance with court orders in international business disputes. Mr. Justice Bryan emphasized the ongoing prejudice suffered by the claimant due to the defendants’ continued failure to comply with the disclosure order. He also noted the ‘lengths to which [Groza and Naumenko] have gone to fight and, the Claimants would say, seek to frustrate, the Claimant’s debt enforcement steps around the world.’
The legal actions against Groza and Naumenko are part of a larger dispute involving loans provided to GNT Group. In 2019, ACP provided a US$75 million loan under a secured English law facility agreement, and in January 2021, Innovatus extended a US$20 million working capital facility. GNT’s repeated failure to pay interest and repay these loans at maturity in December 2021 led to investigations that revealed an alleged asset dissipation scheme worth millions.
Daniel Chapman, CEO and founder of Argentem Creek Partners, called for entities working with Groza and Naumenko to cease business relations, citing the repeated legal findings against them. John Patton, Head of EMEA & Asia at Argentem Creek Partners, described the court’s decision as ‘a step toward justice’ and highlighted concerns about the defendants hiding millions of dollars offshore during a time when Ukraine needs companies to fully support the country’s war effort.
Ana Firmato, Managing Director at Innovatus, added that the sentencing holds Groza and Naumenko accountable for their ‘repeated wrongdoing’ and expressed appreciation for the English High Court’s support in bringing the former GNT owners to justice.
This criminal sentencing in the UK is separate from ongoing criminal investigations into alleged fraud and asset stripping by Groza, Naumenko, and their associates, including Serbian Dusan Denic and Russian Mikhail Ipatov. Denic is also facing a civil fraud case in New York related to the scheme.
The case serves as a stark reminder of the serious legal consequences that can arise from non-compliance with court orders in international business disputes
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