14 Hurt as Pro-Moscow Militants Take Another E. Ukraine Town, Attack Bank and Rally

Heavily armed pro-Russian gunmen on Monday seized another town in east Ukraine, storming the town hall in Kostyantynivka and setting up barricades, as militants attacked a bank owned by an anti-Moscow billionaire.

Kostyantynivka has 80,000 inhabitants and is located mid-way between the flashpoint town of Slavyansk and the regional hub city of Donetsk, both of which are also under the control of insurgents.

Later on Monday, some 300 masked pro-Russian militants wielding baseball bats attacked a branch of the bank owned by an oligarch regional governor who has voiced criticism of Moscow.

The gang attacked the Donetsk office of the powerful Private banking and metal industry holding belonging to Igor Kolomoisky, a billionaire who is also governor of the nearby region of Dnipropetrovsk.

They shouted slogans accusing Kolomoisky, 51, of being a "fascist" and "enemy of the people," an Agence France Presse reporter on the scene said.

A leader of Ukraine's Jewish community, Kolomoisky is worth $2.4 billion (1.7 billion euros).

Kolomoisky has been particularly vocal in his opposition to Russian President Vladimir Putin, attacking him as "not normal."

"He has gone mad with his mission to re-establish the Russian empire," he has said, vowing that "separatism will not pass in Dnipropetrovsk."

Putin himself responded by calling Kolomoiski "garbage" and a "scoundrel."

The oligarch has hit the headlines recently in Ukraine by offering a bounty of $10,000 for each separatist held and handed over to the authorities.

The eastern Ukrainian region of Donetsk is in the grip of a separatist movement which the West believes is being backed by the Kremlin.

In the evening, fourteen people were wounded when pro-Russian militants wielding baseball bats, iron bars and knives attacked a rally for national unity in the east Ukrainian city of Donetsk, according to journalists and local authorities.

Those hurt in the bloody assault were taken by ambulance to hospitals in Donetsk.

One Ukrainian journalist in a hospital trauma unit, Yevgen Shibalov, 32, was hit in the head with a brick.

He told AFP that the demonstration was initially attacked by masked men in uniforms without insignia who pelted them with bricks and fireworks.

Another group "then rushed in and attacked with baseball bats," he said.

"There were several dozen police there. They didn't arrest anyone, though they tried to place themselves between the two groups," Shibalov added.

Several European journalists at the scene tweeted that they too were targeted by the pro-Russian group and had to run.

Donetsk's municipal authorities told AFP that 14 people were wounded.

Russian state media portrayed the violence as a clash between pro-Russian "self defense groups" and pro-Kiev "ultra-nationalists."

The brutality added to spreading unrest in east Ukraine, which the United States and the European Union accuse Russia of fomenting to destabilize Kiev's Western-backed government.

Also on Monday, OSCE chairman and Swiss President Didier Burkhalter said that plans to broaden the organization's monitoring mission in Ukraine depended on Kiev's ability to ensure security for the monitors.

"Today we have a clear willingness not only to continue but also to strengthen the mission," Burkhalter told Agence France Presse, saying the Organization for Security and Cooperation in Europe planned to gradually up the number of monitors from the current 122 to 500.

However, he said the abduction of a team of international observers in the country raised concerns, hinting that if security could not be ensured, the organization would reconsider the mission.

"We don't want to stop, but it is our responsibility to assess the situation steadily," Burkhalter said on the sidelines of an OSCE conference in the central Swiss town of Interlaken, stressing that "if there is a change, then we will act."

"OSCE is really determined to continue the monitoring mission... but the security needs to be assured by the Ukrainian authorities," he said.

"There are more and more people in this monitoring mission and we want their security to be assured. We know that this is a special situation... but there are at least a series of measures that have to be undertaken to ensure the security of these people."

He suggested the Ukrainian authorities would make better progress on the security front if they made "more efforts in the national dialogue, in the integration of the different parts of the country, and less action in the direction of violence."

Burkhalter also stressed the important role Russia had to play in ensuring the release of the observers being held hostage and in calming the escalating tensions.

"Russia's support will be crucial and must now rapidly translate into progress in the negotiation," he said, adding that Russian Foreign Minister Sergei Lavrov had assured him he wanted to see the hostage situation resolved quickly.

"But this message was not really heard in Slavyansk (the eastern city where the observers were abducted), and we have to redouble all the efforts to ensure this message is heard," he said.

Burkhalter also urged nations to refrain from paying ransoms to free hostages, insisting the cash only fuels more kidnappings.

"There is plenty of evidence that ransom payments finance additional terrorist activities and fuel further kidnappings," he said.

"The most effective measure to disrupt this pattern is to apply and promote a policy of no-ransom," he added.

Addressing the opening of the OSCE conference in Interlaken on the organization's role in addressing today's "terrorist" challenges, Burkhalter stressed that "if we want to fight terrorism, we have to effectively hinder its financing."

The issue of whether a country should pay a ransom to free its nationals is a controversial one, with the public at home often pressuring governments to do everything possible to ensure the victims are returned safely.

Burkhalter acknowledged that "applying the no-ransom principle is no easy policy to pursue," but said he was "convinced that it is an indispensable measure to prevent kidnappings in the future and discourage potential hostage takers."

In addition to dissuading countries from coughing up cash to get kidnapped citizens back, Burkhalter urged countries to work together when a "terrorist kidnapping" occurs, and said countries should try to prevent their citizens from traveling to or pursuing activities in places with a high risk of kidnapping.

The two-day conference, which was also scheduled to focus on the importance of upholding human rights in the fight against terrorism and the problem of foreign fighters flowing into places like Syria, was heavily colored by the spiraling crisis in Ukraine.

"The Ukraine crisis has brought to the fore how perceptions of external threats in the OSCE area can diverge. The net effect of this divergence is growing insecurity and uncertainty for everyone," Burkhalter said.

In the flashpoint town of Slavyansk, rebels have refused to release a group of international monitors from the OSCE. They were presented to the media Sunday as "prisoners of war" in what Germany said was a "repugnant" display.

While blasting the hostage taking as "unacceptable" and stressing that the OSCE was doing everything in its power to ensure the hostages safe return, Burkhalter stressed there was no question of paying a ransom.

"We want them to be freed, and we don't discuss about ransom," he told AFP.

Later on Monday, Russia said the decision to send OSCE observers into the east of Ukraine was "extremely irresponsible."

"I would like to point out that it was quite an adventure, or a provocation, I'm not sure, to bring these people to a hot spot," Andrei Kelin, the Russian representative to the OSCE said in Vienna.

"People are expecting an operation or an aggression every moment, so it's extremely tense. That is why it was extremely irresponsible to direct people to this region in this tense situation," Kelin told journalists after leaving the extraordinary OSCE session.

The diplomat reiterated the fact that Moscow wants to see the observers freed, and said that as well as issuing statements to that effect, the country was also taking "some steps" to see that happen.

Eight observers were captured on Friday and held in the Slavyansk town hall.

One of the them, a Swede who was said to suffer from diabetes, was freed late Sunday, but four Germans, a Pole, a Dane and a Czech remain in custody.

The rebels also captured four Ukrainian OSCE representatives, but they have not been seen in public since.

The OSCE is tasked with monitoring a faltering April 17 accord signed in Geneva between Russia, Ukraine, the United States and the European Union that was meant to ease the dangerous crisis in the ex-Soviet republic.

Under the deal, all "illegal armed groups" in Ukraine were supposed to disarm, but the pro-Russian rebels in the east have refused to do so.