You're reading: A year after European football championship, corruption cases linger

Almost a year after Ukraine co-hosted the European football championship with Poland, the nation is still coughing up some of the after-effects of lavish spending for the tournament – especially the many cases of corruption associated with procurement.

The multi-million dollar stadiums were often at the center of media attention during the preparation phase. And they still are now, only for investigators and judges. There are certainly lessons to be learned, especially since Ukraine is preparing for the 2015 Eurobasket championship and getting ready to bid for the right to host the 2022 Winter Olympics.

In one case a state technological safety official was allegedly bribed and allowed unsuitable fire doors to be installed at the Olympic Stadium in Kyiv that hosted the finals, attended by more than 70,000 spectators.

The general prosecutor’s office discovered the inspector allegedly received Hr 350,000 for signing all the approvals, Ekonomichna Pravda website reported. Journalists had earlier discovered that expensive fire doors were installed using flammable construction foam. That means that in the case of a major fire, the doors could simply collapse.

The online newspaper reported that the bribe was allegedly paid by trade company Vist, a subcontractor. If the state officer is found guilty, he might get a prison term of 8 to 12 years, with confiscation of his property. Vist managers, however, only feature as witnesses in this case.

Vist top managers could not be reached for this story. The company’s secretary told the Kyiv Post she wasn’t aware of the situation.

Vist, the subcontractor, signed a contract with AK Engineering, the general contractor for the Olympic Stadium, which was handpicked after the then-deputy Prime Minister Borys Kolesnikov took charge in 2010 of the nation’s Euro 2012 agency.

In the course of two years, the company received hundreds of millions of hryvnias from the state budget to finance the ever-growing construction costs. This led some media to suggest AK Engineering had ties with Kolesnikov, which he vigorously denied. The total amount paid for the stadium went up from the original estimate of Hr 1.37 billion to a whopping Hr 4.6 billion.

Experts said at the time that up to 40 percent of the budget was lost to corruption. This, in part, happened because all procurement operations related to Euro-2012 were freed from competitive procedures.

Speaking at a recent conference in Kyiv, director for Freedom House’s Eurasian Program Susan Corke said the loss of a third part of the funds allocated for the construction of Ukrainian Euro-2012 stadiums was “one of the clearest examples of corruption.”

“Quite often people know that if they have no money for bribes, they will be unable to ensure defense. Public procurement is often aimed at stuffing the pockets of government officials,” she said.

One of the classical cases of non-transparent use of budget happened during the purchase of seats for the stadium. AK Engineering procured them though a chain of little-known companies. One of them, Spetspostach, was accused by Cherkasy region tax police of tax evasion to the tune of Hr 3.8 million in value added tax. Another player in this chain, Vailis LLC, was named by a Cherkasy court as “displaying signs of a fictitious company.”

AK Engineering’s director Volodymyr Artiukh also features in corruption cases. In June 2012, he confessed to being involved in embezzling Hr 24 million during the renovation of Rodovid Bank in 2009, later bailed out by the state. Artiukh remained free and now is trying to improve his company’s reputation.

Kyiv Post staff writer Kateryna Kapliuk can be reached at [email protected].