Institute for War and Peace Reporting | Giving Voice, Driving Change
Ukraine Corruption Probes a Warning to Future Leaders
The YanukovychLeaks team is posting thousands of financial documents online. This one shows payment for a top-of-the-range Mercedes. (Photo courtesy of YanukovychLeaks)
Despite the continuing threat of Russian invasion, many Ukrainians are determined to work towards a better-run, fairer society, and cautiously optimistic that they can achieve it.
Systemic corruption was at the heart of public resentment of President Viktor Yanukovich’s administration. The theft of public funds, accompanied by a sense of total impunity, eroded the value of institutions from the judiciary to the banks, not to mention robbing the taxpayer to fund private and commercial interests.
On the Maidan, the epicentre of months of protests in the capital Kiev, “self-defence forces” still stand guard 24 hours a day more than a month after the revolution. Others just come to the square to be part of a groundswell movement that is watching and waiting to see whether Ukraine’s new leaders will be any better than the last ones.
One legacy of the 2004-05 Orange Revolution is the sense that regime change is not enough, and that Ukraine needs to build solid mechanisms to support the rule of law so that no matter who comes to power, they cannot put their hands in the till, and if they do, they will be found out.
In a unique window of opportunity, with an interim administration willing to look into corruption issues, practical steps to create sounder, fairer systems of governance are happening.
Parliament is talking about setting up a kind of anti-corruption FBI capable of bringing down even senior officials. Judges are to be subjected to checks on past actions and transactions in a process known as lustration.
The appointment of Tetyana Chornovol as head of the government’s anti corruption committee is a sign of how far things have come. In December, the journalist was run off the road, beaten and left for dead. Notes made by a top security officer said “job done”.
And in a unique collaborative effort called YanukovychLeaks, journalists have taken it upon themselves to sift through, collate and make sense of the thousands of documents found at Yanukovich’s residence at Mezhyhirya after he dropped everything and ran.
Under Yanukovich, the lines between private and state commercial interests were completely blurred. Government revenues were siphoned off, laundered, and distributed to officials and businessmen. One way this was done was to award government contracts to shell companies abroad for goods and services.
The general picture was common knowledge in Ukraine, but there was no paper trail – at least not a public one. Yet safe in the belief that they were immune from probes from a law enforcement and prosecution service that did their bidding, staff working for Yanukovich and his associates were meticulously filing paper records of countless transactions.
When Yanukovich hurriedly left his country house on February 21, his staff dumped many of the documents in a nearby reservoir and left others, some of them scorched or burnt, in the house. Salvaged by reporters who were assisted by volunteers including frogmen and archivists, these records provide a unique record of financial transfers, especially for companies linked to Yanukovich and his close associates.
Instead of competing to get exclusive stories, journalists from several media outlets decided that the task needed a collaborate effort to sort and order the massive amount of material, and draw up a comprehensive account of the deals revealed in the document. As well as reporting on their findings, they are compiling a searchable archive of public record on the YanukovychLeaks website.
Each of the participating journalists – 16 at the last count – is specialising in a particular area. One might be looking at the spider’s web of connections between Ukrainian corporations and foreign front companies; others like Anna Babinets of Hromadske TV are investigating the apparently limitless expenditure on Yanukovich’s lifestyle.
As Babinets told IWPR, the aim is to ensure accountability for past and future leaders.
“It isn’t just about knowing there was some Yanukovich guy who stole money and gave bribes. We want to set it down in detail, so that there’s documentary proof of it,” she said. “If he is arrested and convicted, we want our investigative material to be used as evidence. And we want it not to happen again. Those are the two reasons.”
YanukovychLeaks’ purpose of providing free access to public information comes as government institutions try to reform themselves, and create formal checks and balances to prevent corruption.
According to Babinets, “the YanukovychLeaks team shares the common view that the more details we show of how Yanukovich lived, how businesses linked to him functioned, names of people and firms, and the networks, the more chance there is that nothing of this kind will happen again in Ukraine”.
Viktor Chumak, head of the parliamentary committee on organised crime and corruption, says legislators are looking towards a new Anti-Corruption Bureau of Investigation that will be independent of government and empowered to pursue suspects no matter how senior they are.
“I believe there is currently quite a powerful lobby of civil society organisations and broad scope for pressure from journalists, international organisations and donors to urge Ukraine to set up a bureau that will carry out sound monitoring and oversight of spending by public officials,” he said at an April 3 press conference at the Ukraine Crisis Media Centre in Kiev. “As you can see, we now have investigations going on abroad, accounts frozen and the money is likely to be returned to Ukraine.”
Austrian Green Party politician Peter Pilz told the same press conference of parliamentary probes in his own country into a number of banks’ dealings with high-profile Ukrainian businesses of the Yanukovich era.
“We are looking into a history of fraud, and in the Ukrainian [case] of tax fraud,” he said, adding that in the end, “it’s always the same who’s going to pay for what has happened. It’s the Ukrainian taxpayer and the Austrian taxpayer”.
Babinets said the new administration was proving receptive to information about alleged corruption, which the last government certainly was not.
“I have just been called in to the prosecutor general’s office. Many journalists are going to the prosecutor general’s office to help investigators look into cases,” she said. “They might even be the old investigators, but they are following the orders of a new leadership. And they want to get the money back.
“There is a shared understanding that we are pursuing a common purpose,” she added. “It is a unique moment.”
Babinets sees this change as societal as well as institutional.
“Thanks to YanukovychLeaks and thanks to these documents, I would like to believe a new system under which society can operate has emerged. There are journalists and there are people who have documents. And now we can work together,” she said.
With a presidential election scheduled for May 25, Ukrainians will get a new set of political leaders. With that in mind, Babinets says, "it's very important... to set out new rules of the game. It might be politicians from the past, it might be [former premier Yulia] Timoshenko, [boxer-turned-politician Vitali] Klitschko or [interim prime minister Arseny] Yatsenyuk - but with new rules.
“I believe we will build a new society, and that’s why it’s so important to sort through these old documents – to demonstrate a new way of doing things, new rules for this country.”
Meanwhile, the scope of investigations is constantly widening as new evidence comes to light, for example about offshore companies that were used to launder cash, purchase goods, trade in fuel, and supply items for contracts at vastly inflated prices.
The authorities are currently investigating a network of firms controlled by billionaire Serhiy Kurchenko, which they suspect were being used to move cash and goods around for Yanukovich and his officials.
More and more documents have turned up in government ministries, commercial firms and other institutions. In some cases, they are tracked down by reporters, and in others, they are quietly handed over by staff with a conscience.
“This means that the people who are now working [in such institutions] need to understand that there’s nowhere they can hide their documents and their secrets. Their homes and their ministries and their organisations can be searched,” Babinets said. “So if they don’t want to have to flee abroad and burn their documents, there’s a simple recipe – don’t do anything illegal…. Incoming officials and politicians need to understand that their activities, too, will be traced.”
John MacLeod is IWPR’s Senior Editor.
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