On November 20, it became known about the dismissal of the head of the State Special Communications Service, Yuri Shchigol. Simultaneously with this, a message appeared that the National Anti-Corruption Bureau of Ukraine and the Specialized Anti-Corruption Prosecutor's Office suspect the heads of the State Service for Special Communications and Information Protection of embezzling budget funds worth tens of millions of hryvnia.
The head of the State Service for Special Communications and Information Protection, Yuri Shchigol, has been relieved of his post due to suspicion of involvement in the theft of budget funds. For the same reason, Viktor Zhora, deputy head of the State Special Communications Service for digital development, digital transformation and digitalization, was also fired.
The National Anti-Corruption Bureau of Ukraine (NABU) and the Specialized Anti-Corruption Prosecutor's Office (SAP) suspect Shchigol, Zhora and four other people of creating a criminal scheme to seize budget funds.
“The investigation established that during 2020-2022, the owner of the group of companies, in collusion with the leadership of the State Service for Special Communications, developed a scheme to seize budget funds allocated for the purchase of equipment and software. To do this, two controlled companies were involved, and the purchase was kept secret in order to avoid open bidding and ensure their victory. With these companies, a state enterprise subordinate to the State Special Communications Service (we are talking about the State Enterprise “Ukrainian Special Systems” - “Apostrophe”) entered into agreements for the supply of relevant software and services and transferred funds in the amount of more than 285 million hryvnia in 2021-2022. However, the real cost of the software that the companies purchased from a foreign manufacturer was 223 million hryvnia, and the participants in the crime took possession of the difference of more than 62 million hryvnia. These funds were transferred to the accounts of controlled companies abroad for the purpose of legalization and distribution among members of the organized group,” the NABU statement says.
On November 23, the High Anti-Corruption Court (HACC) chose a preventive measure for Yuri Shchigol in the form of detention for two months with the right to post bail in the amount of 25 million hryvnia.
During the court hearing, SAPO prosecutor Igor Tkach said that Shchigol was found to have a crypto wallet containing $1.5 million in equivalent. In addition, during the searches, 72 thousand dollars and 82 thousand euros in cash were found on him.
VAKS also placed under arrest businessman Roman Koval, whom the investigation considers the organizer of the scheme to steal public funds. He also has the right to be released from custody on bail, albeit in the amount of 50 million hryvnia.
From state awards to suspicions
The State Service for Special Communications and Information Protection of Ukraine (Gosspetsvyaz) is one of the key government agencies, as it is responsible for government communications, cryptographic and technical information protection, cybersecurity and cyber defense.
The State Special Communications Service was created in 2006 on the basis of the liquidated department of special telecommunication systems and information protection of the SBU. Today it has an impressive staff of more than 11 thousand employees, 80% of whom are military personnel.
Yuri Shchigol, who worked for many years in the SBU, headed the State Special Communications Service in July 2020.
It should be noted that after the full-scale Russian invasion, the State Service for Special Communications performed very well, for which it received praise from President Vladimir Zelensky, and two of its high-ranking employees received state awards from him.
“It is very important that we have modern, almost uninterrupted communication with our Western partners from the first day of the war,” Zelensky said during a meeting with State Special Communications servicemen in April 2022.
Yuri Shchigol himself was left without a reward, but at the end of March last year he was awarded the military rank of brigadier general.
But, as it turned out, gratitude to the head of state for professional work is not a safe conduct.
“This means that, despite the war, NABU continues to work properly and is investigating the relevant facts,” Ilya Neskhodovsky, head of the analytical department of the ANTS network, said in a comment to Apostrophe.
In turn, Oleksiy Kushch, an expert at the analytical center Ob'ednana Ukraina, believes that the case of the State Special Communications Service indicates that from now on no exceptions will be made and there will be no “sacred cows” that cannot be touched.
“Most likely, this is due to the fact that after the meetings of our leaders with Western partners, the fight against corruption moved from the theoretical phase to the practical,” he said in a conversation with the publication.
According to the founder of the “Our Pennies” project, Yuri Nikolov, Western intelligence services know very well where and how they steal in Ukraine, and inform their governments about this unofficially.
“Therefore, the signal that is being sent to the West is correct, it says that corruption is being fought,” the expert told Apostrophe, adding that it is much worse for our relations with Western partners when corruption in power is not exposed by law enforcement agencies, and journalists and activists.
Control over financial assistance will increase
It is difficult to say how convincing the arguments of the investigation and the prosecutor’s office will be in court. It is quite possible that the people involved in this case are actually guilty, but there is also a political component to this scandal.
As Apostrophe’s interlocutor, who wished to remain anonymous, said, this case reflects the contradictions that exist today within the Ukrainian government, more specifically, in the bowels of the President’s Office.
Another source of the publication claims that the investigation against Yuri Shchigol is, in fact, a blow to Deputy Prime Minister - Minister of Digital Transformation Mikhail Fedorov, who seems to be in favor with the president.
According to Apostrophe’s interlocutor, Shchigol is close to Fedorov, and therefore criminal prosecution of the head of the State Special Communications Service may have a negative impact on the minister. And, if the clouds thicken over Fedorov, everyone who is dissatisfied with digitalization in the country, in particular with electronic security systems, will try to take revenge on him.
At the same time, the source did not say who has a grudge against the country’s main digitalizer.
However, in any case, scandalous showdowns in the Ukrainian government could negatively affect Ukraine’s relationship with its allies, in particular, in the matter of providing us with financial assistance, some of which has already been called into question.
“Of course, such facts somewhat worsen the perception of Ukraine,” says Ilya Neskhodovsky.
However, according to experts interviewed by Apostrophe, it is also not worth exaggerating the significance of such scandals in the context of cooperation with our partners.
“It is impossible to say that the picture is clear, that (corruption scandals) expose Ukraine as toxic. Of course, this adds arguments in favor of reducing aid to Ukraine, but does not lead to a curtailment of cooperation with Ukraine, Neskhodovsky explains. “But our partners will definitely tighten the requirements for the use of funds. They will continue to demand that anti-corruption bodies be strengthened, as well as increased control over the funds they allocate.”
