The Ukrainian Corruption Scandal Fully Explained

For the past 2 months, Ukraine has been rocked by perhaps the most damaging corruption scandal of not just Volodymyr Zelensky’s entire presidency, but rather its entire history. On November 12, Ukrainian anti-corruption agencies revealed that some of Zelensky's closest associates were allegedly involved in a plot to skim around $100 million from Ukraine’s energy sector. The scandal erupts in an imperative time; as Ukrainians struggle with rolling blackouts as a result of Russian bombing on a day-to-day basis, the tens of millions spent by the state every year to protect critical energy infrastructure becomes an increasingly focal flashpoint. This article seeks to explain the roots, controversy, and implications behind the scandal.

Who Solved the Case?

Ukraine’s anti-corruption league—the National Anti-Corruption Bureau of Ukraine, colloquially ‘NABU,’ and the Special Anti-Corruption Prosecutor's Office, or SAP—dismantled an alleged criminal organization that consisted of current and former energy officials, a noted businessman, and a former deputy prime minister.

Lasting nearly 15 months, the probe, dubbed “Operation Midas,” involved nearly 1,000 hours of wiretapping and eventually the seizure of bags of cash. NABU said that five of the seven alleged participants have been detained. Accused of manipulating contracts at Energoatom—Ukraine’s state nuclear energy company—the group extracted kickbacks worth nearly 10-15 percent of contract value. Investigators say that the network laundered roughly $100 million via a secret office based in Kyiv.

Who’s Implicated?

In the aftermath of the revelation, numerous high-profile names were revealed to the public via various online court sessions. Among the revealed are:

• Businessman Timur Mindich, a known close ally of Zelensky, who might be the most interesting name in the crosshairs of prosecutors

• Justice Minister German Galushchenko; suspended from his post on November 12; prosecutors allege that Galushchenko assisted Mindich in his money-laundering scheme. Although no charges have been formally levied, the accusations have triggered his suspension.

• Former deputy prime minister Oleksiy Chernyshov, another close ally of Zelensky, Chernyshov was identified in NABU recordings under the codename “Che Guevara.” NABU has charged him with ‘illicit enrichment,’ and has alleged that he received about $1.2 million and nearly €100,000 via the money-laundering network.

About Mindich

Again, according to NABU, the alleged ringleader spearheading the operation in the purported energy sector kickback plot is Mindich, who is a co-owner of the president’s Kvartal 95 film production company. Since Zelenskyy was elected in 2019, Mindich has also developed more financial interests in several industries. Hailing from the city of Dnipro, he is also a former business partner of Ukrainian oligarch Ihor Kolomoisky, who, in large part, was responsible for funding Zelenskyy’s successful bid for the presidency.

Is Zelenskyy implicated?

Not directly. 

Zelenskyy welcomed the latest probes this week, saying in his regular nightly address to the nation that action against corruption is good. Yet, in the summer, Zelenskyy’s office and the parliament in Kyiv tried to strip the independence of NABU and SAP and place them under the supervision of Ukraine’s prosecutor general, a political appointee.  The move, which coincided with signs that the watchdogs were probing presidential insiders, prompted the first major anti-government street protests since Russia’s full-scale invasion began in 2022. With the EU also urging a rethink, Zelenskyy reversed course.

Read more here:

• Veronika Melkozerova and Jamie Dettmer, Politico

• Mariana Budjeryn, Brookings

• Sasha Vakulina, EuroNews

• Staff, Transparency International