Editor’s Note: The following investigation was conducted by the Washington, D.C.-based Organized Crime and Corruption Reporting Project, a Kyiv Post partner. Kyiv Post staff writer Vlad Lavrov coordinated this project.
KALUSH–DZHURYN, Ukraine – Between 2011 and 2013, an Israeli company called S.I. Group Consort Ltd. won a series of contracts worth more than Hr 1 billion (about $125 million at the time) to clean up a hazardous waste sludge pit near the Carpathian Mountains in western Ukraine.
The government project was intended to safely dispose of carcinogenic chemicals stored near Kalush, a city of 67,600 people on the Limnytsia River, a tributary of the Dnister, in Ivano-Frankivsk Oblast.
The chemicals, a byproduct of the region’s potash mining, have been accumulating for nearly 30 years. Environmentalists say this toxic brew includes the known carcinogen hexachlorobenzene or HCB.
S. I. Consort has declared the area successfully cleaned up – a claim backed by Ukraine’s Ministry of Ecology and Natural Resources. However, no official test results have been released to prove it.
Meanwhile, independent tests completed in 2014 and paid for by the Organized Crime and Corruption Reporting Project found levels of HCB contamination several thousand times the legal limit — raising the question of what, exactly, S.I. Consort did to clean up the hazardous waste in Kalush.
Back in 1976, a large amount of HCB-tainted sludge – exactly how much is a matter of dispute – was stored in a “polygon,” a massive hole dug specifically to safely store toxic materials. It was this contaminated sludge that S.I. Consort was paid to remove.
Environmentalists and the Ecology Ministry, however, say the job was done poorly, leaving behind chemicals that might leach into groundwater and tributaries of the Dnister River, imperiling the water supply used by 10 million people in western Ukraine and Moldova.
Israeli cleaners
The company doing the cleaning has been mired in controversy during its work in Ukraine. S.I. Group Consort Ltd. was founded on Oct. 5, 2008, by Israeli businessman Yehiam Jack Avissar, who today is the company’s director. Israeli Ilya Marchevskiy currently owns 77.5 percent of the company, with Avissar having a share of 15 percent with the rest (7.5 percent) belonging to Israeli lawyer Assaf Cohen.
In January 2011, a court in Tel Aviv found Marchevskiy guilty of tax evasion and sentenced him to seven months in jail, which was later reduced to three months community service by the Israeli Supreme Court.
The tax evasion occurred in 2002-2003 when Marchevskiy was the owner and director, together with Vladimir Libman, of a lumber-importing company in Israel called Yavits Finance International Ltd. The company went bankrupt and Marchevskiy left it, but failed to submit the necessary tax reports or pay its debts to the tax authorities, according to the legal department of the Israeli Tax Authority, which filed the case.
“The defendant chose to renounce his obligations as a director of the company… He left a company mired in debt and (evaded) all responsibility for it,” the verdict said.
In January-February 2012, Marchevskiy repeatedly tried to suspend the execution of the sentence at the Supreme Court, on the grounds that he was needed to fulfill the contract to remove waste in Ukraine. The court denied his request.
In September 2013, Ukrainian police launched a criminal investigation into Si Bud Sistem, the Ukraine-registered subcontractor of the Israeli cleaner, fully owned by Marchevskiy, on the grounds that it was overcharging for its services.
Police suspected that the Ukrainian subcontractor “falsified documents on waste shipment,” and gave “untruthful” information on the actual volume of waste it transported.
Toxic sludge remains
In early 2014, while President Viktor Yanukovych was in power, Ukraine’s State Ecological Inspection reported that 33.500 tons of soil had been collected, stored and exported from the Kalush site between 2010 and 2013. The percentage of HCB in the soil was reported to be 50 percent.
In January 2014, the Ministry of Ecology declared the cleanup to be a success, noting the soil in Kalush was undergoing testing by the Institute of Environmental Geochemistry of Ukraine, known as IEG, which collected 14 soil samples to check for HCB.
The Ecology Ministry promised to announce the results in a month, but has never done so.
In August 2014, reporters for OCCRP sent two samples of Kalush soil from the polygon to the Laboratory of Quality and Safety of Agricultural Products for analysis.
The level of HBC in the first sample was 1,856 times higher than the legal limit. The second sample exceeded the limit by 3,200 times.
The samples – one kilogram of soil in each case – were taken from a depth of 30 centimeters in areas of the polygon not covered with grass or water. It is not clear if the waste was not cleaned up in the first place or if the polygon is leaking. Officials at the Ecology Ministry refused to comment on the OCCRP results.
Halyna Balan, one of the specialists at the Ministry of Health’s L.I. Medved’s Research Center of Preventive Toxicology, Food and Chemical Safety in Kyiv, says such figures are unacceptable.
“If (hexa)chlorobenzene gets into the body with water, it can cause blood diseases and stimulate development of malignant tumors,” she said.
While Balan expressed skepticism about OCCRP’s results, the institute also refused to test the Kalush site itself prior to OCCRP’s testing and would not explain why on the record.
It is not clear from public records exactly what was done at the site. Records indicate that S. I. Consort was paid by the state for its work, but it never explained to the State Financial Inspection of Ivano-Frankivsk Oblast how it spent 97 percent of the money. Other independent authorities that examined the waste found that S.I. Consort appears to have misrepresented the nature of the material removed from the site.
S.I. Consort shipped much of the waste abroad. Officials expected the waste to be heavily polluted but that wasn’t always the case. A check with the British Environment Agency, responsible for regulating major industry, waste and ecology in the UK, revealed that the percentage of HCB in the Kalush soil exported by S.I. Consort wasn’t 50 percent as initially expected from preliminary tests, but on average only 14 percent.
The concentration of HCB in the soil sent to Poland was even lower, with the country’s Chief Inspector of Environmental Protection’s records showing a percentage of 1.6 percent, or almost 31 times lower than the expected amount.
Marchevskiy, the major shareholder, denied any wrongdoing and would not comment on the test results obtained by OCCRP.
“We can prove every step we took with documents, and this has actually allowed S.I. Group Consort Ltd. to successfully settle all issues with law enforcement agencies,” he said.
Marchevskiy did not provide any additional documents to back up his claims.
Bad traces
The polygon site today has acidic ponds 10-30 meters long and empty barrels that previously stored deadly toxic chemicals.
Residents of the district say they continue to collect what they believe to be potentially contaminated mushrooms and berries from the forest nearby. What they may not understand is that once HCB enters the body through air or skin contact, it spreads to all tissues and remains in the body for many years.
Many talk about a terrible cancer plague in the region. They say no authorities have ever told them that HCB can cause cancer.
“Every fourth house in the village has lost someone to cancer,” says Vasyl Shapko of Sivka-Kaluska village, which lies a few kilometers from the polygon. “My mother died six days ago from brain cancer. My cousin died from bone cancer,” he said, tears welling in his eyes.
While the 8,654 -square-mile Ivano-Frankivsk Oblast, where Kalush is located, boasts some of the lowest rates of cancer in Ukraine at 223-244 cases per 100,000 people, by contrast Kalush and its immediate environs show some of the worst, at 293 cases per 100,000.
Officials at the local clinic say many residents also suffer from respiratory problems.
Lidia Kharkevych, a therapist at the Kalush city medical center, sees a connection between the chemical waste and breathing problems. “Every second Kalush resident suffers from respiratory diseases: asthma, bronchitis, infections” and says she is convinced “it is connected with buried chemical waste.”
Proving that environmental toxins are causing the health problems is a very difficult process requiring extensive epidemiological testing that can take many years. There are no plans for such testing in Kalush.
Environmentalists predict the poison from the polygon will get into the groundwater of the Limnytsia and Sivka rivers, flowing into the Dnister and eventually into the Black Sea.
“The Kalush ecological problem is about to turn into a cross-border catastrophe,” says Kalush ecologist Mykhailo Dovbenchuk.
“Moldova’s authorities are deeply disturbed by the situation … (as) 80 percent of the country’s residents use water from the Dniester River. The rivers’ contamination threatens the loss of water resources and vineyard destruction. The Ministry of Ecology doesn’t realize in that case Moldova will sue the Ukrainian authorities for millions of dollars,” says Dovbenchuk.
Yossi Melman (Israel) contributed to this story.
