Extortion of UAH 2.4 mln by Ternopil top officials

Top officials from Ternopil went beyond traditional corruption schemes. They demanded a kickback from a local entrepreneur not for future tender victories but for fulfilling their duties in projects that he had already completed. They were undeterred even though the entrepreneur was a well-known local volunteer who actively supported the Ukrainian military by procuring and repairing equipment.

The persons involved are the head of the Ternopil Regional Council and two deputy heads of the Regional Military Administration, who demanded a "reward" for signing completion certificates for the construction and renovation of infrastructure facilities as well as settling debts for completed work. The owner of a private company was demanded to pay 5-10% of the sums lengthily owed to him by a department of the Ternopil Military Administration. The total kickback reached almost UAH 2.4 million.

However, the entrepreneur decided not to pay, acted within the law, and turned to the National Bureau. While the officials were anticipating the illegally obtained funds, detectives were recording their actions. After the third installment, worth over UAH 600,000, was handed over, they were caught red-handed. All three were notified of suspicion under Part 4 Article 368 of the Criminal Code of Ukraine. The investigation is ongoing.

Embezzlement of UAH 18 mln from SE "Antonov"

NABU detectives successfully uncovered the embezzlement of funds at State Enterprise "Antonov" after a report from the current management of the company. According to it, certain legal papers signed by a former director for legal affairs and a law firm looked suspicious.

The investigation revealed that the law firm was supposed to help the state enterprise recover a debt of over UAH 347 million from the bankrupt PJSC "Brokbiznesbank." Part of the debt was settled with a building worth over UAH 120 million, which was transferred to Antonov in 2018. According to an additional agreement to the contract, the lawyers' fee was supposed to be 5% of the value of the transferred but unsold property. However, the parties conspired and unjustifiably increased the lawyers' fee to 10%, resulting in an overpayment of about UAH 7 million.

Later on, the building was transferred to one of the state institutions at its market value of over UAH 212 million. The debt obligations of Antonov to the state were written off for this amount. Subsequently, the state enterprise additionally paid over UAH 11 million to the law firm.

Thanks to the efforts of NABU detectives, these facts were not only uncovered but also led to the arrest of the entire amount of funds illegally overpaid to the law firm. The ex-Antonov official and the director of the law firm were notified of suspicion.

Corruption in Supreme Court

On May 15, 2023, NABU and SAPO carried out one of their most significant operations, exposing the Head of the Supreme Court accepting a bribe. He, along with a middleman lawyer, is suspected of receiving USD 2.7 million in exchange for rendering a decision in favor of the owner of the "Finance and Credit" group. The "judicial services" were priced at USD 1.8 million, with an additional USD 900,000 supposed to be distributed among the intermediaries.

On April 19, 2023, after finalizing all "financial matters" among the crime participants, the Supreme Court issued the "required" decision – to return over 40% of the shares of the Poltava Mining and Enrichment Plant, which were sold more than 20 years ago, to the group owner. The crucial hearing had been postponed for a month so that the necessary cash was gathered: only the first tranche amounted to USD 1.35 million. During the receipt of the second tranche of USD 450,000, the Head of the Supreme Court and the lawyer were caught red-handed.

To minimize the risk of information leakage, the operation was conducted with maximum secrecy and without the use of phone tapping. Approximately 100 Bureau employees were involved during the final stages of the operation, including the exposure and 30 searches.

The investigation is ongoing, other possible participants in the crime are being identified.

Boiler scheme: Deputy Minister exposed

In January, NABU and SAPO conducted an operation to expose high-level corruption within the Ministry for Communities, Territories and Infrastructure Development of Ukraine. One of the participants in the scheme turned out to be a Deputy Minister, who was caught receiving an undue benefit of USD 400,000.

In the summer of 2022, the Cabinet of Ministers allocated UAH 1.41 billion to restore critical infrastructure to supply Ukrainians with power, heat, and water in winter, given the ruination of critical infrastructure facilities. As the investigation revealed, the Deputy Minister decided to misappropriate a part of these funds. By conspiring with a group of persons and using his official position, he ensured the conclusion of supply contracts at prices 25-30% higher than the market average with pre-selected companies. Those companies were supposed to provide 7-10% kickbacks of the contract amount as a "reward."

To minimize the risk of exposure, the participants in the crime resorted to secrecy: the first tranche of the undue advantage amounting to USD 400,000 was transferred to a trusted person of the Deputy Minister in Lviv. After receiving the funds, this person, along with four other participants in the crime (one of whom attempted to leave Ukraine), was detained and later notified of suspicion. More than 150 NABU officers took part in the operation. The investigation is ongoing.

Exposure of Judges

What unites three judges from Rivne, Odesa, and Kyiv? Not just their profession, but also the fact that NABU detectives exposed their unlawful actions within one week.

The judges from Odesa and Rivne were caught accepting bribes. The first judge was nabbed receiving USD 4,000 for a decision in a civil case, while the second one received USD 1,100 for closing an administrative case related to drunk driving. Their colleague from Kyiv is suspected of abusing power and providing deliberately false information in a ruling. In 2020, she lifted the arrest on EUR 110,700 and USD 9,300, falsely claiming that these funds did not belong to a person implicated in the case but to a completely different person. She also ordered the Asset Recovery and Management Agency (ARMA) to return the money. However, she had no right to consider this matter, and the motion to lift the arrest did not contain any information about the accused whose funds were seized, nor any evidence of these funds belonging to another person. Moreover, the case was already being heard in court at that time, and the decision on whether to cancel the property's arrest should have been made by another judge who was handling the case on merits.

The case against the Odesa judge was sent to court in June. The judge from Rivne and the intermediary lawyer became suspects. The investigation regarding the Kyiv judge is completed, and the defense is currently reviewing the case file.

UAH 55 million fuel procurement scam at Ukrspyrt

In May 2023, NABU and SAPO uncovered corruption at the state-owned enterprise «Ukrspyrt», involving the procurement of coking fuel used for alcohol production. The participants include two executives and a manager of the state-owned enterprise, two entrepreneurs, and two accountants from private companies.

According to the first scheme, entrepreneurs produced fuel on their own and sold it to Ukrspyrt at prices higher than the market average. In the second scheme, the fuel was purchased directly from a related producer and sold to the state-owned enterprise with a significant margin. Tenders for the procurement of fuel were fiction, as the winning companies were determined in advance. To simulate the transparency of the auction, the entrepreneurs ensured the participation of technical candidates.

During both schemes in 2017-2020, the "winning" companies supplied more than 20,000 tons of coking fuel, and due to the inflated prices, Ukrspyrt suffered losses of more than UAH 55 million.

NABU and SAPO have served all seven participants of the scheme with suspicion notices. Their actions fall under Part 5 Article 191 of the Criminal Code of Ukraine. The investigation is ongoing.

Сriminal organization inside SPFU

In March, NABU and SAPO exposed a criminal organization led by the head of the State Property Fund of Ukraine (2019-2022), which embezzled more than UAH 500 million from JSC "Odesa Port Plant" and JSC "United Mining and Chemical Company".

JSC "Odesa Port Plant"

The SPFU head secured the election of a loyal director of the plant. That director secured the prolongation of additional agreements with the LLC under their control on the processing of gas into urea and ammonia at a reduced cost. In order to avoid awkward questions about the constant, groundless extension of the unfavorable contract, the participants conducted a tender for a new raw materials supplier, assuming that the company under their control would win it. After their plan failed, they canceled the results of the tender and signed a contract with a predetermined LLC on the old terms. As a result, Odesa Port Plant in May-December 2020 incurred losses of over UAH 390 million.

JSC "United Mining and Chemical Company"

In this episode, the SPFU head also managed to appoint a loyal director of the enterprise. He deliberately concluded four contracts for the sale of titanium-containing raw materials (ilmenite concentrate) at discounted prices with a Czech company controlled by his adviser. The products were then resold at market prices and subsequently delivered to russians enterprises and those in the temporarily occupied Crimea. This resulted in losses to the state worth over UAH 118 million.

The SPFU head and other members of the group tried to conceal their criminal activity. Moreover, in order to create the image of a person with appropriate ethical principles, he acted as a whistleblower three times during 2019-2020, submitting relevant reports to NABU and widely informing the public about it. In truth, the SPFU head’s "good intentions" were aimed at eliminating competitors at Odesa Port Plant, United Mining and Chemical Company, and other enterprises under the SPFU control and ensuring that only companies controlled by his group could earn money.

Currently, there are ten suspects in the case. Seven persons, including the former head of the State Property Fund, are wanted.

Attempted seizure of land by an MP

The actions of a lawmaker falling beyond a legislative routine caught the attention of the detectives at the National Anti-Corruption Bureau.

In March 2023, NABU and SAPO notified him and three other persons of suspicion of an attempt to abuse the official position to misappropriate an 8-hectare land plot in Kyiv in favor of a private entity for development. This parcel was housing the State Construction Plant of the Verkhovna Rada Secretariat.

The MP conspired with the management of the state enterprise and the then-deputy head of the Verkhovna Rada Secretariat. As a result, the plant's director conducted an illegal auction to conclude an investment agreement for the development of the parcel, in which a company controlled by the lawmaker won. The signed agreement stipulated a share of participation by the state enterprise amounting to around UAH 300 million. However, as established by NABU and SAPO, the actual value of the parcel with the facilities exceeded UAH 525 million.

Further fate of the plant was to be as follows: cutting the workforce, demolishing the buildings, and destroying the equipment. Instead, the participants planned to construct there a residential complex. However, this did not happen, as the parcel was seized by court upon the request of NABU and SAPO. The investigation is ongoing.

Corruption at Ukrzaliznytsia. Episode 1: gas scam

UAH 206 million was embezzled by executives of the "Production Support Center" branch of JSC "Ukrzaliznytsia" (Ukrainian Railways) and other persons involved in the procurement of fuel at inflated prices.

The scheme, which existed from 2016 to 2020, was exposed by NABU detectives in June. It was about the purchase of gas for Ukrzaliznytsia's needs beyond tender procedures through a pre-selected supplier company. After signing the initial contract, scheme participants repeatedly coordinated the markup on gas supply, ranging from UAH 200 to 1000 per thousand cubic meters at different times. The margin was then distributed among the participants.

Corruption at Ukrzaliznytsia. Episode 2: procurement scam

This case became further evidence of systemic procurement corruption at Ukrzaliznytsia (Ukrainian Railways). In May 2023, NABU and SAPO detained three persons, including the deputy director of the «Production Support Center» branch of JSC «Ukrzaliznytsia». The official facilitated the conclusion of contracts with suppliers. Along with the needs of the railway, he partially satisfied his own interests by receiving an undue advantage - a Toyota Camry. In return, he set up conditions for predetermined companies to win the tenders.

According to the scheme, the winners had to give a percentage of the Ukrzaliznytsia payments to intermediaries who had informal relations with the official. The deputy director demanded a car as remuneration. In the spring of 2023, the intermediaries purchased a vehicle for UAH 1.55 million from a dealership and later handed it over to the official.

Alas, he failed to drive the new vehicle, as he and two other participants in the scheme were notified of suspicion. The undue advantage, Toyota Camry, was seized and handed over to the National Agency of Ukraine for finding, tracing and management of assets derived from corruption and other crimes (ARMA).

NABU detectives are checking the possible involvement of other Ukrzaliznytsia officials in the scam. The investigation is ongoing.

Over half a billion hryvnias has been allocated for the needs of the army, and almost a billion hryvnias has been reimbursed to state-owned enterprises.

The economic impact of NABU and SAPO's work since the beginning of 2023 amounts to more than UAH 1.67 billion.

Thanks to NABU and SAPO, an additional UAH 662 million has been sent for the country's defense needs since the start of 2023. In total, since russia unleashed its all-out aggression, almost UAH 2 billion has been allocated. These are assets seized or voluntarily contributed within the scope of criminal proceedings investigated by NABU and SAPO, as well as bail deposited following the rulings of the High Anti-Corruption Court.

Besides funding for the Armed Forces of Ukraine, nearly UAH 1 billion has been reimbursed to the state, including public enterprises. Over UAH 883 million was returned by private companies to PJSC "Ukrnafta" (50%+1 share owned by the state), and an additional UAH 2 million was compensated for damages to JSC "Ukrzaliznytsia" (fully owned by the state).

The materials collected during the investigation by NABU detectives helped successfully prevent the embezzlement of nearly UAH 70.5 million. Throughout 2023, several guilty verdicts were also legally enforced with property confiscation, including both monetary assets and real estate, totaling over UAH 25.5 million.