Corruption in Ministry for Development: former state secretary, minister’s advisor, and state enterprise director exposed (PHOTOS)

NABU and SAPO have uncovered a large-scale corruption scheme in the construction sector involving high-ranking state officials.

Suspicion notices for abuse of office and the receipt and offering of undue advantage in vast amounts have been served to:

• the former state secretary of the Ministry for Development of Communities and Territories, currently a member of the Naftogaz of Ukraine Management Board;
• the former advisor to the minister;
• the former director of a state-owned enterprise;
• a real estate developer (the scheme’s organizer);
• an official of a construction company.

According to the investigation, the developer devised a scheme to illegally obtain a land plot in Kyiv for the construction of a residential complex. To do this, he approached top officials in the Ministry, who arranged for the land to be transferred to a controlled state enterprise. That enterprise, in turn, unlawfully signed investment agreements with a "selected" construction company.

Under these agreements, the developer was required to hand over a portion of the future apartments to the state in proportion to the value of the land. To minimize this portion, the land and buildings on it were deliberately undervalued — nearly five times lower than market value. The difference between this appraisal and the market price exceeded UAH 1 billion. This is the amount of real estate the state would have been deprived of had the agreements been fulfilled. The scheme was disrupted thanks to the seizure of the land at the request of NABU and SAPO.

As a reward for facilitating the scheme, the developer "thanked" ministry officials and other individuals designated by them with significant discounts on apartments in already constructed residential complexes. With these discounts, the price per square meter ranged from UAH 1,000 to 8,000, while the market minimum for such properties was about UAH 30,000 per square meter. The total amount of undue benefit provided amounted to UAH 16.8 million.

At the request of NABU and SAPO, most of the unlawfully acquired apartments have also been seized.

It is worth noting that the aforementioned developer, the construction company official, and the former director of the state enterprise are already defendants in another NABU and SAPO case concerning an attempt to bribe a minister with apartments.