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A Corruption Sting Gone Public Sparks Outrage, Debate in Kiev

On November 17, 2016 two fancy Ukrainian ladies met at the restaurant in the center of Kyiv. One of them was an assistant of a Ukrainian parliamentarian; another claimed to represent Fujeirah, a company from the United Arab Emirates interested in the extraction and export of Ukrainian amber. The subject of their conversation was how to make changes to a bill to legalize the amber business and end illegal amber mining, which has intensified since Ukraine’s Revolution of Dignity in 2014.

According to Tetyana Liubonko, an assistant of MP Maksym Poliakov of the popular People's Front Party, the women first negotiated the amount of a bribe—$15,000—to be paid to the three people initiating the changes. “Five will be paid to Rosenblat [Ukrainian MP], five to my boss and the same amount will be given to Boyarkin, Head of State service of geology and mineral resources],” Tetyana said. Later, Poliakov himself joined the meeting to explain that nothing could be done without his partner Boryslav Rosenblat from President Petro Poroshenko's party BPP who at that moment chaired the Ecology Committee and was the main co-author of the bill Fujeirah wanted modified.

The first five thousand dollars was paid in five days and the bills were registered in the parliament the same day. $1800 of the amount paid to Poliakov was used by Tetyana to buy two iPhone 7’s for her boss and his wife.

After the payments were made, a Fujeirah representative had several meetings with the consultant and both MPs, Poliakov and Rosenblat, and the legislative work progressed—so did the size of the bribes as the $15,000 down payment slowly grew to hundreds of thousands of dollars.

But while the plot thus far had the look of a mafia-style collaboration between legislators and outside interests that sometimes characterizes Ukrainian politics, the deal was actually quite the opposite—a meticulously planned, top-secret sting operation managed by two anti-corruption institutions created in Ukraine after the Revolution of Dignity: the National Anti-corruption Bureau (NABU) and the Specialized Anti-corruption Prosecutor's Office (SAP). The American FBI was also engaged in the operation in accordance with a memorandum of cooperation whereby the FBI lends support to investigations in Ukraine of international money laundering crimes, as well as in cases involving bribery and corruption of high-level officials. No details on this collaboration were disclosed.

This sting operation was revealed to the Ukrainian public in the summer of 2017, when NABU and SAP released a film based on Agent Kateryna’s undercover work who brilliantly acted the part of the fake foreign company representative.

The sting, orchestrated by NABU and SAP, was the first such operation to have been conducted by Ukrainian law enforcement. It was widely and enthusiastically applauded by the public because it signaled a long overdue declaration of war against corruption that is a defining fact of life in Ukraine: the scourge that limits citizens’ opportunity and chokes off the country’s development and international respect; and finally, rewards the thugs and petty criminals who infect the country’s government and political class that too often determine the fate of the country and its citizens. 

Both Ukrainian MPs Poliakov and Rosenblat lost their parliamentary immunity and would seem vulnerable to prosecution. Poliakov’s bail was around one million Ukrainian hryvnia, or $35,000, and Rosenblat's family has paid seven times that amount. Yet, with the evidence of their audacious business-as-usual crimes having been displayed in the full view of the country, both remain free, continue to act as MPs, and avoid imminent prosecution.

The reason is simple: the Ukrainian judicial system is undermined by the executive branch and suffers from widespread corruption and nepotism. Members of the country’s thoroughly corrupt judiciary are routinely seduced by bribes and promises of advancement, or forced by intimidation, to obstruct the country’s law enforcement agencies from prosecuting crimes and pursuing efforts to bring criminals to justice. Of the 86 cases filed by the National Anti Corruption Bureau and the Specialized Anti Corruption Prosecutor so far, 63 have still not been reviewed—hence Ukraine’s ranking of 78 out of 113 countries in the The World Justice Project Rule of Law Index.

Recently, two judges tried to bribe the head of SAP Nazar Kholodnytsky, offering him $300,000 to release one of their colleagues accused of breaking the law.

In an effort to reverse corruption in Ukraine, the country is in the midst of a debate over the establishment of an anti-corruption court that would be immunized from the pervasive culture of corruption. The effort would never see the light of day except that powerful Western partners—whose loans and grants are something of a lifeline to the country—are demanding the creation of the independent court as a condition for the continued flow of assistance into Ukraine. The International Monetary Fund (IMF) has indeed conditioned the payment of the next tranche of its $17.5 billion loan, approved three years ago, to help the country stave off default amid the military conflict in eastern region of Donbas.

On September 15, President Petro Poroshenko initially rejected the idea of creating an independent anti-corruption court. He claimed that it was impossible to establish the special court because of the approaching parliamentary elections in 2018 and the presidential race in 2019. He also appealed to national pride by observing that such institutions exist only in third-world countries like Kenya, Uganda, and Malaysia. But under the weight of criticism by legal authorities and western politicians and officials, he reversed course and eventually endorsed the establishment of the anti-corruption court structure.

"There are several bills now,” Poroshenko said. “They are not perfect. In some way, these are PR-projects of some political forces. Of course, everyone supports the anti-corruption court, but the devil is in the details.” Despite these caveats, the president promised to quickly establish an anti-corruption chamber in the Supreme Court for corruption cases involving high level officials. He has proposed the formation of a parliamentary working group to deal with the details.

Despite the rhetorical commitments to change, however, most political observers in Ukraine have trouble believing that the political establishment will actually create an independent body to investigate itself and bring its criminals to justice. The culture of corruption that dominates much of the work of parliament loathes and fears NABU and SAP, and they fully appreciate that the Special Anticorruption Court now being considered, given its construction and independence, might well be the most important step the country has taken to overturn the entrenched and venal status quo of which they are the primary enablers.

 

Iuliia Mendel is a Ukrainian journalist; she contributes to the New York Times and Politico.eu, and is a 2015 World Press Institute Fellow.

 

 

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