Ukraine uncovers corruption scheme implicating top officials

Two high-ranking Ukrainian officials have been named as suspects in an embezzlement scheme uncovered by Ukrainian anti-corruption authorities this week, involving the procurement of humanitarian aid.

Ukraine’s first deputy minister of agrarian policy and food and the former deputy minister of economy reportedly misappropriated UAH 62 million (about €1.5 million), the National Anti-Corruption Bureau of Ukraine (NABU) and the Specialized Anti-Corruption Prosecutor’s Office (SAPO) found, according to POLITICO.

This is just the latest wave of corruption that has swept Ukraine since the war with Russia started in 2022. In January, two major corruption scandals centered on government procurement of military catering services and electrical generators shook the country.

Rather than sweeping the suspect deals under the carpet, President Volodymyr Zelenskyy launched a major crackdown, in a bid to show allies in the U.S. and EU that Ukraine is making a clean break from the past. Earlier this month, he fired all regional military recruitment bosses amid reports of corruption, replacing them with soldiers who have been on the front lines or who have been hurt in combat.

The most recent scheme involved the purchase of food which was intended as humanitarian aid for regional military administrations and for the populations of Donetsk, Kherson, Sumy, Zaporizhzhia, Kyiv, Khmelnytsky, Dnipropetrovsk and Poltava regions and the city of Kyiv, SAPO said.

According to the agencies, in one episode the first deputy minister of agrarian policy purchased food at prices two to three times higher than market value through a controlled company, which in turn bought the products at market value from a Polish manufacturer.

This cost Ukraine’s railway company Ukrzaliznytsia about €719,000 between March and August 2022.

“He was aware of the actual market value of the products, as he regularly received relevant data from the state statistical service,” said NABU in a press release. “He also knew about the possibility of purchasing products from Ukrainian manufacturers but deliberately ignored this fact.”

In a separate scheme involving both officials, food was purchased once again at higher prices through an intermediary company which, in turn, bought food at market value from a Turkish manufacturer. The deputy minister of economy hid proof that there were better offers available and pushed officials to illegally approve applications and invoices from the controlled companies.

As a result of this scheme, Ukrzaliznytsia overpaid companies about €841,000.

“Having been received, the funds were transferred to a foreign company with signs of fictitiousness for further legalization,” NABU said. “Draft records outlining the distribution of the ill-gotten gains were discovered during a search at a scheme participant’s place.”

The investigation is ongoing.