Ukraine: realities | «The Weekly Five»: 22.01 – 28.01

Corruption in the Ministry of Defense: Seven Officials Face Suspicions in 2023

During the year 2023, seven officials of the Ukrainian Ministry of Defense have been accused of committing corrupt offenses. This was announced by the Prosecutor General, Andriy Kostin, during a briefing.

"Among them are notorious officials who, according to the investigation, were involved in the procurement of substandard body armor," he emphasized, adding that one such case has already been transferred to the High Anti-Corruption Court.

According to him, currently, under the procedural guidance of prosecutors from the specialized prosecution office in the defense sector, two investigations are underway regarding the procurement of substandard body armor and personal protective equipment amounting to over 1.4 billion UAH, the supply of substandard winter uniforms for 945 million UAH, as well as misappropriation of budget funds exceeding 250 million UAH.

Kostin noted that in 2023, more than 220 criminal investigations have also been initiated regarding violations in the military accounting sphere, which is four times more than in 2022.

 

Oligarch Igor Kolomoisky's Detention Extended

Businessman Igor Kolomoisky's detention has been extended by the court until March 2, with a bail set at 2.65 billion hryvnias. The relevant decision was approved during the session on January 22.

"To extend the detention period until 02.03.2024. Set bail at 2 billion 650 million hryvnias," stated the judge.

Prosecutors requested the extension of Kolomoisky's detention in the pre-trial detention center during the pre-trial investigation. In turn, his lawyers insisted on changing the preventive measure from custody to house arrest in the village of Mykilske-on-Dnipro in the Dnipropetrovsk region, citing the businessman's unsatisfactory health condition.

The court also rejected the request for Kolomoisky to be released on bail.

It is worth noting that on September 2, 2023, Kolomoisky was accused of fraud based on materials from the Security Service of Ukraine and the Bureau of Economic Security.

"It has been established that during 2013-2020, Igor Kolomoisky legalized over half a billion hryvnias by transferring them abroad, using the infrastructure of financial institutions under his control," stated the Security Service of Ukraine.

 

"The Modest Oligarch": What One of the Richest Ukrainians, Igor Palitsa, Declared for 2022

Igor Palytsia, a close associate of Igor Kolomoisky and an oligarch who, according to Forbes Ukraine, ranked 49th in the list of the richest Ukrainians in 2022, has filed a relatively modest declaration for a person on the list of the richest Ukrainians. According to his income declaration, he did not declare any income for the year, did not use his own car, and lived in an apartment gifted by his father – such conclusions can be drawn from his income declaration.

The Member of Parliament submitted his electronic declaration of property and income for the year 2022 on December 13, 2023, as reported by Irina Kravchuk on the website of the Center for Journalistic Investigations "Power of Truth."

In his declaration for 2022, Igor Palytsia, a representative of Lutsk in the Verkhovna Rada, mentioned a gifted apartment from his father with an area of over 400 square meters, two companies that generated no income, and several million hryvnias in savings. According to the declaration, in 2022, he managed to sustain himself thanks to his savings, as he did not even receive his parliamentary salary. Palitsa also did not declare any vehicles, neither owned nor for use, despite the legal requirement to report any cars he uses.

In 2022, Igor Palytsia entered the list of the top 100 richest Ukrainians according to Forbes Ukraine, although his ranking dropped from 44th to 49th place. This was attributed to substantial losses he incurred due to Russia's full-scale invasion.

Among the family members, Palytsia mentioned only his daughter Maria, registered as residing in Switzerland. She does not own any property or business. However, Igor Palytsia has long ceased to declare his son Zakhar and ex-wife Oksana, who are registered as owners of a significant portion of the family's companies and assets. Despite a promise in September 2020 to declare all family-owned property and businesses, including shares in Bukovel, oil shares, hotels in Austria and Odessa, he has not fulfilled this commitment.

In his 2022 declaration, like in the one for 2021, Palytsia stated that he is the founder of the Igor Palytsia Fund "Only Together" and two companies: LLC "Look Poit" and LLC "High View", registered in 2021. He contributed 14 million hryvnias to the charter capital of the former and a thousand hryvnias to the latter. "High View" showed no signs of activity during its almost two years of existence, receiving no income according to the financial report for 2022 and accumulating debts exceeding 50 million hryvnias. "Look Poit" earned only 51.6 thousand hryvnias in almost two years and accrued debts of over 50 million hryvnias.

In 2022, Igor Palytsia earned an income of 439.5 thousand hryvnias, which constituted his salary averaging 36.6 thousand hryvnias per month. However, the source of his livelihood in 2022 remains unknown, as reported by "Power of Truth," the Verkhovna Rada apparatus directed his entire parliamentary salary to charity. The politician did not declare any other income.

Regarding personal savings, the former leader of the political party "Za Majbutne" declared 3.22 million hryvnias, with 1.73 million hryvnias in bank accounts and 1.49 million hryvnias in cash.

Igor Palytsia did not declare any significant expenditures in 2022, unlike in 2021 when he spent over 17.2 million hryvnias. The declared real estate included two offices in Lutsk, previously reported, and an apartment with an area of 423.1 square meters in Lutsk, transferred to him by his father Petro Palytsia in 2020. He did not declare any vehicles for ownership or use.

In addition, the politician listed valuable watches in his declaration, including Rolex Oyster Perpetual, Audemars Piguet Tourbillon Chronograph, and Audemars Piguet Automatic (industrial sample - graphic image for advertising with the inscription "Only together, we are Ukraine"), as well as seven bank accounts.

On December 24, 2023, Igor Palitsa notified the National Agency on Corruption Prevention (NACP) of significant changes in his financial state – he received dividends of 5 million hryvnias from LLC "Look Point." The document also mentioned one million hryvnias in expenditures related to this company.

Previously, the Center for Journalistic Investigations "Power of Truth" investigated  what Palytsia could have declared as significantly greater wealth if he had adhered to his own promise.

In 2021, the Prosecutor General's Office opened a criminal case against MP Igor Palitsa for possible money laundering of illegally obtained income. However, the results of this investigation are unknown.

 

USA Opens Hotline for Confidential Reports on Corruption in Ukraine

The United States has opened a hotline for reports on corruption and abuses affecting the support for Ukraine. This was announced  by the Office of the Inspector General of the United States Agency for International Development (USAID).

"The United States is committed to supporting the Ukrainian people during Russia's resolved aggressive war. We must oversee the use of funds and resources provided by American taxpayers to support Ukraine," the statement reads.

"We encourage timely and open reports of corruption and abuses that impact the support for Ukraine and its people from the United States," emphasized the American agency.

This includes potential issues such as "corruption, sexual exploitation or abuse, fraud, mismanagement, human trafficking." Confidential reports on any suspicious activities related to the programs or operations of the U.S. Department of Defense, the U.S. Department of State (including the U.S. Agency for Global Media), and the U.S. Agency for International Development can now be submitted to the respective hotline.

 

Denmark Allocates Over $8.5 Million to Combat Corruption in Ukraine, EU Also Contributes

Denmark will contribute nearly 60 million Danish kroner (over $8.5 million) to the European Union Anti-Corruption Initiative (EUACI) program aimed at combating corruption in Ukraine. This announcement was made during the visit of the Danish Minister of Foreign Affairs to Ukraine. The support is part of the third stage of the initiative that has been ongoing since 2016, as reported by the Danish Ministry of Foreign Affairs.

"Despite Russia's illegal invasion, Ukraine has made significant progress in combating corruption, and even while the country is at war, it has managed to continue positive changes. However, there are still areas that can be improved, and it is crucial for Ukraine's EU aspirations that we help them achieve their goals," said Danish Minister Lars Løkke Rasmussen during his visit and meeting with his Ukrainian counterpart, Dmytro Kuleba.

The European Union will also allocate funds to the program, contributing over $10 million. The program aims to promote transparency and integrity in the reconstruction of facilities in the city of Mykolaiv through close collaboration with the mayor and his team. The plan is to develop best practices during the reconstruction that can be applied in other cities across Ukraine.

 

The project «Ukraine: realities» is implemented by the News agency «Konkurent» together with the Civic Movement «SVIDOMI» in English for readers from other countries to tell to tell about current news and events in Ukraine.

Проєкт «Ukraine: realities» реалізовується Інформаційним агентством «Конкурент» спільно з Громадянським Рухом «СВІДОМІ» на англійській мові для читачів з інших країн аби розповісти про актуальні новини та події в Україні.