Just days after Ukrainian President Volodymyr Zelensky’s office moved to curtail the powers of anti-corruption institutions back in July, the new law had to be hastily repealed due to Western criticism and the first mass protests since the outbreak of full-scale war. Now, after several months of silence, the anti-corruption agencies have responded with a wave of high-profile revelations.
About six months ago, the Security Service of Ukraine (SBU) conducted a large-scale operation against investigators from the National Anti-Corruption Bureau of Ukraine (NABU), an independent bureau established in 2015 on Western recommendations to combat corruption in the upper echelons of power without having to defer to traditional law enforcement agencies, which were often implicated in high-profile investigations.
The justification given for the SBU operation was that NABU investigators were collaborating with fugitive pro-Russian politicians and the Kremlin. “The anti-corruption infrastructure will work, only without Russian influence—it needs to be cleared of that,” Zelensky said at the time. Parliament swiftly voted to limit the powers of NABU and affiliated organizations.
This move by the president was seen in some quarters as a desire to eliminate external control, and at an opportune time. Donald Trump’s new administration in the United States has shown little interest in promoting democracy and the rule of law in other countries; in Europe, Kyiv’s internal turmoil was expected to be eclipsed by the need to fight against Russian aggression; and at home, Ukrainian society seemed too exhausted by the war to pay much attention to political squabbles.
Things did not go to plan, however. The EU’s reaction was extremely negative, and Kyiv and other major cities saw their first street protests—supported by local mayors—since the start of the full-scale war. The president’s team was forced to back down, but the damage was done.
Zelensky’s reputation in Europe suffered a major blow amid a wave of Western publications about Ukrainian corruption. Relations between the presidential administration and Zelensky’s Servant of the People party also deteriorated, with parliamentary deputies forced to vote for two contradictory resolutions. A significant part of Ukrainian society was unconvinced by the accusations that NABU detectives were working for Russia, and the whole episode was perceived as an attempt to protect the president’s inner circle from being investigated.
It was clear that the standoff would continue, with those tasked with fighting corruption redoubling their efforts to investigate. Sure enough, NABU began to make revelations this month that have eclipsed all previous scandals and allegations.
The investigation in question centers on Timur Mindich, a businessman who is part of Zelensky’s inner circle. A co-owner of Zelensky’s Kvartal 95 Studio production company, Mindich loaned the former actor and comedian his armored car when Zelensky ran in the 2019 presidential election. Mindich was also once close to the oligarch Ihor Kolomoisky (who is now in pre-trial detention on charges of fraud and embezzlement), and had business interests in Russia, including in the diamond trade.
Zelensky’s trust in Mindich was such that the president celebrated his birthday in 2021 in an apartment belonging to Mindich. That same apartment would later be bugged by anti-corruption agencies.
After the outbreak of the full-scale war, Mindich became a prominent figure in the new oligarchy that grew up around the supply of military goods. He has been linked in the media to the company Fire Point, which before the full-scale invasion was a casting agency for Kvartal 95’s shows, but in recent years has become a major arms manufacturer, receiving up to 10 percent of Ukraine’s defense procurement spending. The company denies any connection with Mindich.
NABU’s Operation Midas began with reports of searches at the homes of Mindich, who was no longer in Ukraine, and former energy minister turned Justice Minister German Galushchenko, who has now been sacked. NABU subsequently released wiretap recordings revealing a vast corruption network in Ukraine’s energy sector. The private conversations paint a highly damning picture of all the trappings of state capture.
According to NABU, a group of individuals, including officials and businessmen close to the government, used the state-owned Energoatom, Ukraine’s biggest electricity producer, for their own illegal enrichment. Private companies paid kickbacks to informal “overseers” for the right to work with Energoatom, and this illicit cash was then laundered through the group’s financial network. The criminal scheme’s mastermind was supposedly none other than Mindich.
The ripple effects of the revelations are spreading to affect a growing number of senior officials, including former defense minister Rustem Umerov, recently appointed Prime Minister Yulia Sviridenko, Energy Minister Svetlana Grinchuk, who has already resigned, and others. Former deputy prime minister Oleksiy Chernyshev, another member of Zelensky’s circle of confidantes (Zelensky’s wife is allegedly godmother to Chernyshev’s child), is also accused of having received cash from Mindich’s shadow coffers.
Adding to the scandal’s toxicity is the involvement of people formerly associated with Andrei Derkach, the longtime head of Energoatom who defected to the Kremlin and is now a member of Russia’s upper chamber of parliament, the Federation Council. One of the defendants in the current scandal is Igor Mironyuk, a former aide to Derkach, and the “shadow office” at the heart of the corruption scheme was located in premises owned by Derkach’s family.
The corruption scandal is dominating Ukrainian domestic politics, with all opposition forces seeking to exploit it. Three opposition factions in parliament—representing the European Solidarity, Holos, and Fatherland parties—are demanding the resignation of the government and its replacement with a “national unity” cabinet with the participation of the opposition. They are also calling for the resignation of Andrii Yermak, the influential head of the presidential administration. As the scandal grows, there are rumors that some deputies from Zelensky’s Servant of the People party are prepared to back these demands.
NABU has received support from European leaders, who have made no secret of their disappointment and are calling on the Ukrainian leadership to thoroughly investigate all allegations. There is little doubt that ongoing European aid will now be even more closely tied to anti-corruption purges and public administration reforms. It is also clear that the corruption scandal will be used against Ukraine both by those opposed to continuing to provide Western support and by Russian propaganda.
Zelensky is seeking to distance himself from the scandal, saying he supports the investigation and telling Bloomberg: “The president of a country at war cannot have any friends.” Sanctions have already been imposed against Mindich and others implicated in the allegations, but the accusations against people close to the president cannot fail to impact his image.
It’s possible that Zelensky’s team is counting on being able to weather the storm, which could soon be overshadowed by events at the front. NABU has often been criticized before for allowing charges to become bogged down in court and other legal proceedings.
But at a time when half the country has no power due to Russian strikes against Ukraine’s energy infrastructure, embezzling funds from the energy sector looks like nothing short of looting. Far from dying down, the political storm only looks set to intensify.
