The “selective” justice being employed by Ukrainian authorities – as recently noted by the United States and the European Union – involves not only a crackdown on former officials from the government of ex-Prime Minister Yulia Tymoshenko. The other part of the “selectivity” involves ignoring, it appears, numerous cases involving people close to the current government.
Different rules, it seems, apply to different political camps.
Take the case of Serhiy Demishkan, the son of a government official who is reportedly a close friend of President Viktor Yanukovych. He is accused of murder, but has been released on bail, while former Interior Minister Yuriy Lutsenko, under investigation for abuse of office in a case that involves $30,000 at most-, remains behind bars.
With such varied treatment, the authorities are fueling claims of persecution. Meanwhile, evidence implicating top officials close to Yanukovych in corruption appears to be routinely ignored by prosecutors and police.
Yanukovych’s administration appears much more intent on chasing Tymoshenko for alleged abuse of power by spending hundreds of millions of dollars in government money on pensions, instead of on energy efficiency, as it was earmarked for.
Meanwhile, such cases such as the investigation of billions of dollars in central bank aid – allegedly misused by banks and top officials in the wake of the 2008 global financial crisis – appear to be going nowhere.
The following are some of the most obvious and striking alleged corruption cases where authorities appear to be taking a softer position than the hard line taken against Tymoshenko and her allies:
Accused killer free
Serhiy Demishkan is the son of Volodymyr Demishkan, who is reportedly a close friend of Yanukovych and heads Ukravtodor, the state monopoly responsible for development of the country’s road network. The elder Demishkan is also a member of parliament representing the pro-presidential Party of Regions.
His son Serhiy is charged with committing a murder in October 2007. According to the indictment, Demishkan and his two accomplices kidnapped Kyiv resident Vasyl Kryvozub, 62, the director of a small airline, as they tried to force him to give Demishkan one of the planes belonging to Kryvozub’s company.
When Kryvozub refused to do so, Demishkan and his accomplices allegedly murdered him by throwing him in an irrigation channel with a radiator tied to his back. If proven guilty, Demishkan could face a life sentence. However, the Kyiv Appellate Court, where the trial started in September 2008, in late 2010 released Demishkan on bail.
At the same time, the prosecution requested additional investigation, despite the fact that Prosecutor General Viktor Pshonka – also a close Yanukovych friend – in 2007 had, as a deputy prosecutor, signed Demishkan’s indictment before submitting it to the court.
Now, the prosecutor’s office has to decide which authority will investigate the case further, while the victim’s family plans to submit an appeal to the European Human Rights Court for violating the maximum duration term for investigation. Andriy Mamalyga, who represents the victim’s family in court, is pessimistic that this case will ever reach a verdict, due to the fact that Demishkan’s father is now a government official.
Volodymyr Demishkan denied interfering on his son’s behalf. But Mamalyga predicts that the case against Demishkan “will simply disappear” along with the many other cases of alleged corruption and wrongdoing since Ukraine became a nation in 1991.
Yanukovych’s palace
Mezhyhirya is the name of a cozy area near the village of Novi Petrivtsi, some 20 kilometers from Kyiv that most Ukrainians never heard of a decade ago.
This all changed back in the early 2000s, as then-Prime Minister Viktor Yanukovych developed a liking for this place, located right on the shores of Kyiv Sea, a reservoir, and moved in to a state mansion located there. What started as a rather modest state-owned house with 1.5 hectares of land was transformed into a gigantic private clubhouse with 138 hectares of land.
The former state residence and surrounding land are now privately owned or leased by a number of obscure companies or foundations paying the state very low rental fees. And Yanukovych lives there.
Evidently, they don’t mind Yanukovych using the property, while the president himself doesn’t feel it necessary to answer how he or companies close to him acquired the estate.
Stadium cost overruns
Kyiv’s Olympic Stadium, the venue for the Euro 2012 football championship final, may need $550 million for reconstruction. Since the signing of a contract in 2008, costs have more than doubled. By the time the games are played, the funds spent may be much closer to the $1.5 billion world record – set by London’s Wembley Stadium.
After all, as Ukraine’s Vice Prime Minister Borys Kolesnikov admitted last May, it’s impossible to say how much the stadium will end up costing due to the lack of necessary project-related paperwork, which makes it sound more like a corruption sinkhole. At least one criminal case has already been opened in relation to the misuse of funds during the reconstruction of Olympic Stadium.
Last May, the Security Service of Ukraine and the Prosecutor General suspected Chernyavsky gave out a contract worth $70,000 for consulting services that had been already done and paid for. Earlier, the parliamentary commission investigating reconstruction of the stadium found that – during the currency exchange operations under Chernyavsky’s management – the state incurred losses totaling Hr 4.3 million ($543,000).
Just two months later, Chernyavsky married Ekaterina Bogolubova, daughter of billionaire Gennady Bogolubov, one of Ukraine’s richest men. Neither the General Prosecutor’s Office, nor the Security Service of Ukraine, which started this case, returned the Kyiv Post’s request for information, breaching the 30-day deadline provided by law that they have to respond to press inquiries.
Violence in parliament
The fight in parliament that took place on Dec. 16 shocked even the most cynical of Ukrainians. Watching members of the Party of Regions violently battering their opponents who blocked the podium made one wonder not only if the Ukrainians should continue paying their taxes, but also if these people should be isolated from the rest of society.
The most obvious question that one might ask is if any of these people will be persecuted, especially given that at least two of the most aggressive ones – Dmytro Salamatin and Mykola Zlochevsky – hold government jobs.
They have already asked parliament to dismiss them, as it is against the law to serve in parliament and as a government official, which should solve the problem of their immunity from prosecution, which being a lawmaker provides.
But prosecutors seem more inclined to go after the opposition members who were beaten. Prosecutors have opened a criminal case on interfering with a statesman’s work. At the same time, deputy general prosecutor Yevhen Blazhyvsky mentioned the possibility of opening a criminal case related to the 2007 blocking of parliament’s electric switch room, which also was carried out by opposition members. There has been no mention of the fact that the pro-presidential Party of Regions spent large chunks of 2009 blocking parliament.
Shady spending
National investment projects, providing state financial support for various innovative projects like alternative energy and nanotechnologies, are heavily promoted by the current government. There is also considerable money involved. In the next three years, nearly $10 billion will be borrowed under state guarantees to finance Ukraine’s high-tech breakthrough.
Early on in the project, the transparency of the process in which the loans are granted is being questioned. According to documents published by Ukrainska Pravda website, nearly $25 million was allocated to a Zaporizhia-based enterprise that manufactures solar batteries. It is reportedly linked to First Deputy Prime Minister Andriy Klyuyev.
According to the report, the government also plans to allocate over $100 million to build a number of solar power plants in Crimea, again to a company reportedly linked with Klyuyev.
Good roads for VIPs
Road construction in Ukraine lately seems to be as arbitrary as rulings made by the nation’s notoriously corrupt courts. In the last six months, Ukrainians witnessed top dollar being spent to build great roads not used by a large share of Ukrainians, but that lead to elite estates belonging to top officials. According to media reports, the eight-kilometer state-of-the-art highway to the residence of Viktor Yanukovych in Mezhyhirya cost around $6 million.
A similar phenomenon occurred during the repair of the highway passing through an elite suburb of Koncha Zaspa, where many of Ukraine’s wealthiest and most influential people live. The renovated part of the road stops exactly at Koncha Zaspa’s limits, around four kilometers short of the town of Obukhiv.
This even caused an argument, captured on video, between First Deputy Prime Minister Andriy Klyuyev and Deputy Prime Minister Borys Kolesnikov, with the latter accusing Klyuyev of building a personal highway to his own mansion. Klyuyev denied this.
Bank scandals galore
Refinancing of banks by the National Bank of Ukraine at the height of 2008 financial crisis was aimed at stabilizing the financial system and keeping the banks from bankruptcy. While banks did remain afloat and even recorded nearly 100 percent increase in their top managers’ salaries, the national currency devalued more than 50 percent.
Yulia Tymoshenko, as prime minister, accused the central bank of foul play during the refinancing. According to her information, instead of strengthening their reserves, the banks used the central bank money to buy up foreign currency, thus devaluing the hryvnia even more and giving it as loans to their own companies.
Getting these funds required kickbacks of around 10 percent, according to Tymoshenko. Her accusations specifically singled out Nadra Bank, which overall received more than $1 billion in bailout money, much more than any other Ukrainian bank.
The general prosecutor’s office issued an international search warrant for the bank’s board chairman Ihor Gilenko, who in mid-2010 was found in Russia. As of December, Ukrainian authorities still don’t appear to have come up with a solid plan on how to arrest him and punish other top managers and shareholders of the bank for misuse of funds.
Expensive presents
A Cadillac received by the Interior Ministry from an unnamed sponsor last March is hard to describe as anything else but a bribe. In fact, this is exactly the explanation that Interior Minister Anatoliy Mogilev gave, after Hennady Moskal, an opposition lawmaker and former deputy head of the Interior Ministry, alleged that luxurious Cadillac Escalade, worth more than $100,000, was Mogilev’s birthday present from his colleagues.
Who exactly gave this present to the police and whether he expected anything in return remains unclear. The luxury SUV was subsequently transferred to the Ministry of Foreign Affairs, and, reportedly, was used to transport Stefan Fule, the EU’s enlargement chief, during his latest visit to Kyiv.
Gas conflicts
RosUkrEnergo, a Swiss-registered gas trading firm which between 2006 and 2009 served as a monopoly supplier of gas to Ukraine, last year won a case against Ukraine in Stockholm Court of Arbitration. The ruling, later upheld by domestic courts, ordered Ukraine to return 12.1 billion cubic meters of gas worth more than $3 billion to the company, which is co-owned by Russian state energy giant Gazprom and Ukrainian oligarchs Dmytro Firtash and Ivan Fursin.
The gas, which had been acquired in a complex debt-purchase deal with Gazprom in 2009, is being gradually returned to RosUkrEnergo. But many still question whether Ukraine’s government did enough to win the court case.
Huge conflicts of interest abound, primarily involving Energy Minister Yuriy Boyko, who served on RosUkrEnergo’s board of directors. Moreover, Tymoshenko as prime minister repeatedly alleged that Firtash and Fursin represent the interests of Yanukovych’s inner circle. Yanukovych’s chief of staff, Serhiy Lyovochkin, admits to being close friends with both Firtash and Fursin.
If these aren’t serious enough for prosecutors to investigate, then there is a raft of cases left over from the presidencies of Leonid Kuchma and Viktor Yushchenko, covering the last 17 years in national history.
Many of those unsolved cases and mysteries can be read online at www.kyivpost.com in the special 2008 project called “Ukraine’s Greatest Crimes.”
Kyiv Post staff writer Vlad Lavrov can be reached at [email protected]
