There are many of us who are living in the intermittent darkness of rolling blackouts in Ukraine, making tea using camp stoves while headlines cross our computer screens saying President Zelensky’s former business partner is part of a kickback scheme at Ukraine’s nuclear power utility that gained him and his friends some $100 million.
This is bad. On a number of levels, this is very bad. How bad depends on how Zelensky responds.
What we know
The investigation is ongoing and rapidly changing, but this is a summary of what I am hearing in Kyiv, reading in the news, and finding in court documents.
- The corruption scheme involved a group of political insiders, some who have historically been close to Zelensky, demanding kickbacks from contractors to Energoatom for 10% to 15% of the amount of the contracts. Over time, that amounted to around $100 million. All current indications are that the contracts were funded by Ukrainian rate-payer and tax-payer money rather than international donor money.
- One of the insiders, Tymur Mindich, President Zelensky’s business partner prior to Zelensky’s 2019 election, was likely tipped off to a raid of his home and fled the country, as did another suspect. Five suspects are in custody.
- Zelensky claims he and Mindich have not seen much of each other during the war. The last public sighting of the two together was 2021, when Mindich threw a birthday party for the President.
- Energoatom has not directly received foreign assistance since a $300 million Euro loan by the European Bank for Reconstruction and Development in 2019. This is according to AI-assisted research.
- While Energoatom seems not to have received direct funding from donor countries, it has received technical assistance from foreign partners during the full-scale Russian invasion. This was implemented by foreign experts outside the normal Energoatom procurement process. There is no evidence that these companies were involved in kickbacks. Many countries have legislation similar to the US Foreign Corrupt Practices Act, which provides strict penalties for companies engaging in corruption in foreign countries.
- An official from Energy Community, an Austrian-based organization that has coordinated billions in aid to Ukraine’s energy sector, is quoted as saying the corruption “risk is mitigated,” since his organization retains “full control” over the coordination, purchase, and post-arrival monitoring of equipment – with procurement handled by an independent agency in the UK.
- The companies that were pressured to make kickbacks were Ukrainian companies performing construction and repair for plant facilities and grid substations within the normal Energoatom procurement process, paid for by Ukrainian ratepayers and/or Ukrainian taxpayers.
- An AI scan of court documents and news stories yields no evidence that President Zelensky was involved. That being said, the Financial Times quotes Ukrainian anti-corruption activists as saying Zelensky slow-walked the investigation.
- While nobody is currently implicating Zelensky directly, Ukrainska Pravda is reporting that Zelensky’s powerful chief of staff, Andriy Yermak, is under investigation. Those familiar with the workings of the Office of the President say it is plausible that Yermak would know about the corruption and Zelensky would not. Yermak is said to control all information flow to and from Zelensky. The joke among Ukrainians to foreigners is that they should come meet Zelensky so he will introduce them to Yermak.
- Zelensky has dismissed both the energy minister and the Minister of Justice. Energoatom has dissolved its board. An audit is taking place.
- The New Voice of Ukraine is reporting that investigators had a routine meeting with the FBI liaison in Ukraine on Nov. 12. In further reporting, the New Voice of Ukraine reports that “influential figures in the US establishment” say Mindich could be formally targeted by the FBI in a money laundering case.
Potential EU impact
European officials have expressed concern over the scandal. For years, Western and Southern Europe have found reasons to underfund their defense budgets and skimp on aid to Ukraine. In 2024, the EU somehow justified sending more money to Russia for fossil fuels than aid to Ukraine. Led by France and Belgium, EU LNG imports from Russia increased between 2024 and 2025.
European leaders are to meet in Brussels in mid-December to once again discuss the frozen Russian assets. This scandal will not lubricate the discussions.
The Energoatom scandal may have finally given Western Europe a valid reason to justify its glacial pace of insufficient support, and at precisely the wrong time. Ukraine is facing a $41 billion budget deficit. Belgium controls ~ €200 billion in frozen Russian assets and has done almost nothing with it in nearly four years, but tax it for some €3 billion. Brussels, with a multi-billion euro cash cow on one side of the equation and a risk of angering Putin on the other, has not just been dragging its feet but lying on the ground clutching at lamp posts and the ankles of passersby as other European leaders try to drag it into giving up the frozen Russian assets.
European leaders are to meet in Brussels in mid-December to once again discuss the frozen Russian assets. This scandal will not lubricate the discussions.
On a lighter note, Viktor Orban, the EU leader most subservient to Putin, posted a screed on X about corruption in Ukraine, prompting a series of zebra-themed memes and photos of his lavish estate that has a zoo with zebras. Hungary is consistently ranked as the most corrupt country in the European Union. Fifteen years of Orban’s leadership have made Hungary the poorest nation in Europe.
Potential domestic impact in Ukraine
The worst for Zelensky may be yet to come. Some report that the contracts that were subject to the kickbacks were not fully performed or not performed at all. In one recorded conversation, the corruption conspirators said that building “f***ing protective” structures to protect power installations was like “burying money.”
Ukrainians are angry.
The average Ukrainian hates corruption. Eighty percent of Ukrainians polled think it is a major problem, but as a hangover from Soviet times, it was long seen as a part of doing business. The war has changed this.
Ukrainian insiders say more investigations are coming.
Anecdotally, I’ve asked dozens of Ukrainian soldiers at the front if they have seen corruption around American weapons. The standard answer is: “No, and if I did, I would shoot that person.”
Even those who think that corruption is a part of doing business are angry about the business not getting done. Every day, every Ukrainian is reminded when the lights go out that Zelensky’s buddies got away with $100 million while they look at their families by candlelight.
Ukrainian insiders say more investigations are coming.
The Kyiv Independent, citing multiple unnamed sources, reported in August that Ukrainian drone maker Firepoint has ties to Mindich and Yermak, and receives favorable treatment from the government. The rumor mill in Kyiv says that this investigation will be made public next week.
American officials on both sides of the aisle have expressed a strong distaste for Andriy Yermak and some in Kyiv say these investigations are an operation to take him out. Ukrainians would not mind. They tend to see Yermak as the reason for Zelensky’s problems. Sixty-two percent of Ukrainians say they would support Yermak’s resignation. Only 8% say they would be strongly against it.
How much was the FBI involved? Public information shows the investigations and arrests were driven by the National Anti-Corruption Bureau of Ukraine (NABU) and the Specialized Anti-Corruption Bureau of Ukraine (SAPO), It is hard to believe that the FBI would have better information than Ukrainian investigators, but certainly the FBI would have been more than happy to help.
Ukrainians in the streets
Last summer, tens of thousands of Ukrainians turned out in the street to protest Zelensky’s efforts to neuter NABU, the organization that brought the Energoatom scandal to light.
Despite what Americans might perceive, Ukraine is working hard to curb corruption.
Twice in its recent history, millions of Ukrainians have turned out to protest the government. Ukrainians who are keen to protest say this scandal could spark another such outpouring if Zelensky does not immediately and unwaveringly embrace reforms and root out corruption. Some speculate that if Zelensky does not navigate this precisely, he may not survive the protests this could generate.
People are going to jail
Despite what Americans might perceive, Ukraine is working hard to curb corruption.
In August 2023, the defense minister was fired along with six of his deputies for an acquisition scandal involving thousands of military jackets from Turkey. The scandal involved Ukrainian taxpayer funds in the Ministry of Defense, not international donor money.
Ukrainians I talk to say that government officials are getting punished who they thought would always be above the law.
Case in point, Vsevolod Kniaziev, former president of the Ukrainian Supreme Court. Kniaziev is a sharp, relatively young man who thought it was a good idea to accept a $2.4 million bribe. He was also receiving a sweetheart deal for rent in a Kyiv luxury apartment. He has been convicted of that crime, and the trial for the larger bribe is ongoing.
To the best of my knowledge, nobody was fired from the Pentagon for buying $640 toilet seats. The Pentagon has not passed an audit in seven years of trying. Kareem Serageldin is the only Wall Street figure who went to jail for the 2008 financial crisis, which erased $14 trillion of net worth from Americans.
No matter who you are or what side of the aisle you are on, you think that someone on the other side of the aisle is wildly corrupt and needs to be imprisoned. In Ukraine, those arrests are happening.
See the original of this article, reprinted from the author’s blog Tales from World War III here.
The views expressed in this opinion article are the author’s and not necessarily those of Kyiv Post.