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Ukraine energy firm hiring Biden’s son raises ethical concerns

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FILE: Dec. 4, 2013: from left, Vice President Joe Biden, granddaughter Finnegan Biden, son Hunter Biden, arriving in Beijing, China.AP

Vice President Joe Biden’s visit Saturday to Ukraine in support of the country's new democratic government is renewing concerns about his youngest son being hired by a Ukraine company promoting energy independence from Moscow.

Hunter Biden will be working for the company while his father and others in the Obama administration attempt to influence energy policies and other issues of the new government, which is gripped in a struggle with Russia and pro-Russian separatists to control the county.

The company, Burisma Holdings Limited, says it wants to reduce Ukraine's dependence on Russian gas and oil, a goal that parallels U.S. efforts to aid Ukraine's energy industry.

The other major issues are Hunter Biden’s new employer leases natural gas fields in Crimea, an eastern Ukraine peninsula being controlled by Russia in the country’s months-long political upheaval. And the company is owned by a former Ukraine government minister, Nikolai Zlochevskyi, who has ties to the country's ousted pro-Russian president, Viktor Yanukovych.

The 44-year-old Biden was hired in April and will be a director and lawyer for the company.

American conflict-of-interest laws and federal ethics rules essentially do not regulate the business activities of adult relatives of those who work in the White House, and there’s no indication that the situation crosses legal or ethical lines.

But ethics experts appear divided over the implications.

"The primary problem here is the fact that Hunter Biden has set up a financial arrangement with someone who might have business pending before this administration," said Craig Holman, an ethics expert with Public Citizen, a Washington-based government reform organization.

Joe Biden led the U.S. delegation at Saturday's inauguration of Ukraine's new president, Petro Poroshenko, and announced $48 million in additional aid for the Kiev government. Biden met Poroshenko and said "there is a window for peace and you know as well as anyone that it will not stay open indefinitely ... America is with you."

The Office of the Vice President said some of the money will help Ukraine “enhance its energy security.” 

Ukraine is an important natural-gas and petroleum-liquids transit country. Two major pipeline systems carry Russian gas through Ukraine to Western Europe.

At least two oil and natural gas fields leased by subsidiaries of Burisma are in Ukrainian territories where pro-Russian sentiments remain strong, according to government and media releases, independent energy maps and Burisma's website.

One is in the breakaway Russian-backed state of Crimea. The other is in the eastern Ukrainian Kharkiv region. Instability there could force the younger Biden's new company to coordinate with pro-Russian separatists whom the U.S. considers illegitimate.

White House officials declined to comment on Hunter Biden's association with Burisma and the company's holdings in Crimea and east Ukraine.

The vice president's spokeswoman, Kendra Barkoff, previously said that Biden's son is a private citizen and a lawyer, and that Joe Biden "does not endorse any particular company and has no involvement with this company."

Presidents and vice presidents have long been vexed by relatives rewarded for family ties.

Political loan troubles shadowed Vice President Richard Nixon's brother, Donald, during the 1960 election, and President Jimmy Carter's brother, Billy, who accepted a $220,000 stipend in 1981 from Libya's Moammar Gadhafi.

In recent years, several Bush and Clinton relatives were caught in a string of murky financial and political dealings.

But "unless there's solid evidence that Hunter Biden got his job to influence American foreign policy, there's no clear line that's been crossed," said Melanie Sloan, executive director of the Citizens for Responsibility and Ethics in Washington.

A former Washington lobbyist, the vice president's son is effectively exempt from most rules that would require him to describe publicly the legal work he does on behalf of Burisma.

Zlochevskyi's name is missing from Burisma's web site, but financial documents in Cyprus as well as U.S. Securities and Exchange records show that he owns the bulk of Burisma's shares. Zlochevskyi's Cyprus-based Brociti Investments Limited controls Burisma.

The Associated Press contributed to this report.