Ukraine is pulling out all the stops in its efforts to show the European Union that it is taking meeting the requirements for membership of the bloc seriously by cracking down on one of the country’s endemic problems: corruption. On Wednesday, on the eve of an EU-Ukraine summit being held in Kyiv, the office of the Prosecutor General carried out another large-scale series of raids involving several state institutions, the culmination of numerous investigations into alleged cases of corruption, embezzlement and tax fraud in the upper echelons of power. “I am comforted to see that your anti-corruption bodies are on alert and effective in detecting corruption cases,” European Commission President Ursula von der Leyen said in Kyiv on Thursday.
Agents of the Prosecutor General’s office searched offices belonging to businesses and high-ranking government officials allegedly linked to several illegal schemes. The most serious of these involves oil company Ukrtatnafta, of which the Ukrainian government is the majority shareholder, and from which it is suspected up to €1 billion ($1.09 billion) may have been defrauded. In relation to this case, the Security Service of Ukraine (SSU) searched the house of Ihor Kolomoyskyi, the company’s former CEO. Kolomoyskyi is an oligarch from Dnipro and one of the richest men in Ukraine, who has been a long-term financial supporter of Ukrainian President Volodymyr Zelenskiy during his career as a television producer and actor and, above all, in his political ascent.
Investigations have also been launched against three senior Defense Ministry officials: Bogdan Kmelnitskyi, former deputy director of supplies; Volodymir Tereschenko, deputy director of international procurement; and Vyacheslav Shapovalov, former deputy minister, who are being investigated over alleged fraud in the procurement of equipment for troops of lower quality than what was stipulated in the contracts.
Shapovalov resigned last week after the Anti-Fraud Office opened an investigate into suspicions that he had approved agreements to award a shell company a contract valued at €360 million to supply food to the military at well above market price. The contract was leaked to the ZN media. Initially, Defense Minister Oleksii Reznikov accused journalists of manipulating what was a technical error and threatened action by the secret services.
The Ukrainian authorities have also announced the prosecution of a senior Odesa official for allegedly receiving a $40,000 bribe in a land rezoning fraud case. Former minister of internal affairs Arsen Avakov was also formally informed that he is under investigation for possible irregularities in the purchase of Airbus helicopters in 2018. Avakov, for his part, told Pravda that a possible technical error in the helicopter that crashed in January outside Kyiv, causing the deaths of Interior Minister Denys Monastyrsky and two senior government officials, was being investigated. In addition, the SSU also acted against officials of the Kyiv tax agency and led a raid against a procuring network of which the deputy director of the National Police’s State Migration Service is accused of being the ringleader.
In addition to Shapovalov, the former number two in Zelenskiy’s office, Kyrylo Tymoshenko, was indicted in a possible case of influence peddling. The president announced on Wednesday that he had also dismissed the entire leadership of the State Customs Service. Damilo Hermantsev, head of the parliamentary committee on finance, taxes and tariffs, said Thursday in an interview with the Ukrainian News Agency that irregularities in the border customs service “have only worsened during the war.”
One of the criticisms most often leveled against Zelenskiy is that he had not fulfilled a commitment to reorganize the Anti-Corruption Prosecutor’s Office according to the independence standards he had pledged. Last July, Zelenskiy appointed Andriy Kostin as the new Prosecutor General and Oleksandr Klimenko to head up the anti-corruption office. Kostin had been Zelenskiy’s candidate for the post in 2021, but the appointment met with opposition from organizations outside the government, which claimed he had not been transparent in his declaration of assets and that he was too close to Zelenskiy. One of the entities that voiced concerns about Kostin before the Russian invasion, according to the Kyiv Independent, was Transparency International. In the annual Corruption Perception Index published by the organization in 2022, Ukraine ranked 116th out of 180 countries; a six-place improvement from 2021. In a statement on his social networks, Kostin stated: “There is no return to the past. Ukraine is following the path to Europe and will not deviate from it.”
Last June, the EU accepted Ukraine as a candidate country for EU membership. The European Commission’s report on approving the candidacy included seven recommendations. Three of them concerned corruption and called on the country to strengthen its fight, “in particular at the highest level” and to comply with international standards of legislation to prevent money laundering and limit the power of oligarchs.
Demands on Kyiv to improve its corruption control systems are not only linked to its future as a potential EU member state, but also to the desire of its international allies to monitor the financial aid they are supplying during the war. In January, the president of the European Council, Charles Michel, laid out the amount of aid Ukraine has received from the EU budget: €50 billion, of which €18 billion has gone directly to the state budget for 2023. In addition, the EU has provided €1.1 billion in military aid. Other non-EU countries, notably Washington, have also provided billions in financial and military support. The US has introduced its own mechanisms to monitor the spending of the more than $50 billion in direct humanitarian, financial and military aid it had guaranteed to Ukraine up to the end of 2022.
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