Anatomy of a scandal: why Zelenskyy launched a corruption crackdown in Ukraine

When Ukrainian investigative reporter and anti-corruption activist Yuriy Nikolov was tipped off about an overpriced catering contract for the defence ministry, he knew the story could land him in trouble.

By publishing it, not only would Nikolov break a taboo on criticising the Ukrainian government during wartime. He knew it could also cast a shadow over his embattled country and tarnish the reputation of one of the most prominent figures of the war: defence minister Oleksiy Reznikov.

Nikolov reached out to the ministry, but was brushed off, he told the Financial Times. On Monday he published his findings, which showed the ministry had signed a $350mn deal with a catering company to pay wildly inflated prices for food going to Ukrainian troops.

The story of overpriced eggs and gherkins set off alarm bells for Ukrainians, who, according to the country’s central bank, have donated about $500mn of their own money to the army. Many recognised it as a classic scheme used by powerful officials to line their pockets. That it was money meant to help feed their defenders made it all the more scandalous.

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The army food scandal broke as Ukraine was pleading with its western partners to supply it with tanks and other critical arms supplies for the fight against Russia’s invasion forces. The country’s bid to become an EU member state will depend on credible rule of law and anti-corruption reforms.

It was the first domino in a cascade of stories that would lead to resignations and sackings of senior government officials, as well as the biggest government shake-up since the start of Russia’s full-scale invasion.

In a matter of days, one of President Volodymyr Zelenskyy’s deputy chiefs of staff, five governors of frontline provinces, four deputy ministers and two members of the president’s ruling Servant of the People party in parliament would resign or be fired because of scandalous or allegedly corrupt behaviour.

Ukrainian troops sit down for a meal. The scandal over army food has had a knock-on effect © Scott Olson/Getty Images

“Corruption is a negative in any case but in our circumstances, at our level of development in our democracy and fighting against Russia, the cost is very high, it’s people dying every day,” said lawmaker Yaroslav Yurchyshyn, first deputy head of the parliamentary committee on anti-corruption policy.

Ukrainians are focused on defeating Russia, Nikolov said, “but it turned out that, in fact, [Ukrainians] really don’t like corruption and want justice, too”.

“Soldiers in the trenches,” he added, were among the many readers who had written to thank him for exposing the deal and stopping it before payment was made.

Reznikov denied any wrongdoing in a fiery Facebook post and passed the blame to his deputy, Vyacheslav Shapovalov, who oversaw procurements and who quit when the scandal broke.

Ukraine’s top military commander, General Valeriy Zaluzhnyi, called for a thorough investigation of the corruption allegations, adding that the military had “zero tolerance for corruption”.

Yurchyshyn, who sits on a parliamentary committee dealing with anti-graft policies, told the FT that the shake-up proved that ongoing anti-corruption reforms were working. “We created NABU, an anti-corruption court, a special anti-corruption prosecutor and ProZorro” — a digital procurement system to increase transparency and competition, Yurchyshyn said.

“It is fair, it is needed for our defence, and it helps our rapprochement with European institutions,” Zelenskyy said of his government shake-up on Tuesday. “We need a strong state, and Ukraine will be just that.”

Ana Pisonero, a spokesperson for the European Commission, said leaders in Brussels, who say Ukraine’s potential future accession into the 27-member bloc is conditional on it cleaning up corruption, were pleased with Zelenskyy’s response and “welcome the fact that the Ukrainian authorities are taking these issues seriously”. But more progress on reforms was still needed, she added.

In particular, the EU wants to see the reform of Ukraine’s historically problematic Constitutional Court and the selection process for judges.

Zelenskyy swept into power in 2019 largely on the promise of ending the war with Russia and tackling graft. In Transparency International’s most recent Corruption Perceptions Index published just before Russia’s full-scale invasion on February 24 last year, Ukraine ranked 122nd out of 180 countries, a slight improvement over the previous year but no major improvement since 2018, when Ukraine was ranked 120th least corrupt state.

Tetiana Shevchuk, legal counsel for Ukraine’s Anti-Corruption Action Centre, a leading watchdog, told the FT that Zelenskyy’s shake-up and crackdown showed he was trying to live up to his promise. His measures also include a ban on foreign travel for public servants after some officials were caught taking lavish vacations while civilian men aged 16 to 80 are not allowed to leave the country.

“Zelenskyy did this to show allies he is serious but it’s about his domestic audience, too,” she said, adding that some of the scandals had been known for months.

“There was a lot of tension inside the country,” she said. But civil society was wary of causing a public outcry about them, lest they inadvertently harm their country by fuelling Russian propaganda or presenting an image of Ukraine as a corrupt place to western backers.

For instance, Ukrainian investigative journalists had photographed Zelenskyy’s deputy chief of staff, Kyrylo Tymoshenko, on more than one occasion driving a flashy new Porsche Taycan worth $100,000 and a sport utility vehicle donated by General Motors for the use of delivering humanitarian assistance last autumn.

But Tymoshenko resigned only on Tuesday, after public outrage and Zelenskyy’s promise that heads would roll.

Kyrylo Tymoshenko, Zelenskyy’s former deputy chief of staff © Evgen Kotenko/Future Publishing/Getty Images

Shevchuk said that, until then, anti-corruption activists had operated under an “unspoken agreement” with the government. “It was as follows: we don’t criticise you as long as you do the right thing. If you do something wrong you have time to fix your mistakes.”

But setting up a scheme to steal money from Ukraine’s vital war chest, she added, “crossed a red line”.

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