President Volodymyr Zelensky has been embroiled in Ukraine’s biggest corruption investigation since the start of the war, with members of his inner circle accused of siphoning off and laundering $100 million from the state-owned nuclear power company.
Ukrainian anti-corruption agencies exposed the scheme 10 days ago, but they have unfurled the case slowly, revealing information almost every day through wiretap recordings and court testimony. The steady stream of details has fed the sense of a growing scandal that could reach the highest levels of Ukraine’s leadership.
Here’s what we know about the investigation, called Operation Midas.
The scheme revolved around kickbacks.
At the heart of the case is Energoatom, the nuclear power company. Investigators said that participants in the scheme had pressured Energoatom contractors to pay kickbacks of 10 to 15 percent.
If contractors refused, they were denied payments owed by Energoatom, according to investigators. The scheme, they said, exploited a rule under martial law that prevents contractors from collecting debts in court from companies providing essential services, including Energoatom, which covers more than half of Ukraine’s electricity needs.
Investigators said that some kickbacks had been tied to contracts for building protective shelters over critical equipment used to supply power to nuclear plants. Russia has targeted electricity substations connected to the plants.
Kickbacks were then laundered through a back office in Kyiv, the Ukrainian capital, according to investigators. They said that the office was owned by relatives of Andriy Derkach, a pro-Kremlin former Ukrainian lawmaker who headed Energoatom in the 2000s before fleeing to Russia at the start of the war. He is now a member of the Russian upper house of Parliament.
Excerpts from wiretaps released by the anti-corruption agencies suggest that some funds may have been transferred to Moscow.
“Two are gone, they’ll be in Moscow in a week and a half,” a suspect is heard saying on one tape. Investigators said the number referred to a sum of money.
Those accused include a former Zelensky business partner.
Anti-corruption agencies have so far accused eight people of involvement in the scheme. Most were caught on wiretaps using code names and speaking in sometimes cryptic language.
Investigators said that the criminal network was led by Timur Mindich, who co-owned a television studio founded by Mr. Zelensky. Opposition lawmakers and anti-corruption experts have long described Mr. Mindich as a shadowy political and business figure who influenced Mr. Zelensky’s cabinet appointments and oversaw operations at state-owned companies.
Investigators said that Mr. Mindich fled Ukraine a few hours before a search of his home last week. His location today is unclear, and he has not publicly commented on the case.
The anti-corruption agencies also said that a former deputy prime minister, Oleksiy Chernyshov, a close ally of Mr. Zelensky, had received about $1.3 million from the kickback scheme. On Tuesday, the High Anti-Corruption Court of Ukraine ordered that Mr. Chernyshov be held in pretrial detention for two months. Mr. Chernyshov said he was innocent.
Five other people have been taken into custody for their roles in the scheme: Energoatom’s head of security; a former adviser to the energy ministry; and three employees of the back office accused of handling the money laundering. Another suspect has reportedly fled.
Herman Halushchenko, Ukraine’s justice minister and a former energy minister, whose voice is reportedly on the tapes, resigned at Mr. Zelensky’s request. Svitlana Hrynchuk, who succeeded him as energy minister, also resigned.
The scandal has put Zelensky under political pressure.
The inquiry’s implication of senior ministers and a former Zelensky associate has raised questions about whether the Ukrainian president or his top aides knew about the scheme.
Mr. Zelensky appears on the tapes, speaking with Mr. Halushchenko, though not in an incriminating way. Still, Mr. Zelensky is facing growing calls for a purge. Fedir Venislavskiy, a member of Mr. Zelensky’s party, said that the president’s powerful chief of staff, Andriy Yermak, should resign.
Opposition lawmakers are calling for the dismissal of the entire administration. On Tuesday, they disrupted a parliamentary session and blocked the rostrum, demanding the government’s resignation.
The scandal is especially sensitive for Mr. Zelensky after he tried unsuccessfully this summer to defang the same anti-corruption agencies that revealed the kickback scheme.
Mr. Zelensky has tried to distance himself from the case. In addition to calling for the resignations of Mr. Halushchenko and Ms. Hrynchuk, he imposed sanctions on Mr. Mindich. He has also vowed to clean up the country’s major state-owned energy companies.
Still, the scandal has hit at a particularly bad moment for Ukraine’s leadership.
Scheduled blackouts are now imposed daily because of Russian attacks on the power grid. The revelation that Energoatom was involved in the scheme has fueled public outrage that the authorities have done too little to protect the energy system.
Mr. Zelensky has also been pressing his European allies for more financial aid. But the corruption inquiry risks making international partners think twice before sending more money.
Chancellor Friedrich Merz of Germany, one of Ukraine’s top donors, told Mr. Zelensky last week to “vigorously pursue the fight against corruption.”
Olha Konovalova contributed reporting.
Constant Méheut reports on the war in Ukraine, including battlefield developments, attacks on civilian centers and how the war is affecting its people.
The post What to Know About the Corruption Scandal Roiling Ukraine appeared first on New York Times.
