The Ukrainian forest industry often faces problems such as poaching and timber smuggling for further export to Europe. Even with a state monopoly on logging and during the conflict in the country, this problem did not disappear. In the autumn of 2022, the industry experienced reform, but there are still few changes in the structure of the forestry industry. The head of the State Enterprise “Forests of Ukraine”, Yuriy Bolokhovets, plays a role in the management of this industry and is responsible for the development and fight against illegal activities.
“Comments” looked into what was happening in the forestry industry of Ukraine, and who could be to blame for the situation that had arisen, when industry leaders in only one region have a fortune amounting to millions of dollars. From forestry enterprises to the State Enterprise “Forests of Ukraine” Until September 2022, the forestry industry of Ukraine was represented by 158 forestry enterprises (forestry enterprises), whose tasks included cutting down forests, planting new ones to replace those cut down, and so on. All these enterprises belonged to the state, which had a monopoly on cutting trees, and conducted independent economic activities.
This method of management was constantly criticized, and in the fall of 2022 the industry faced another reform - all forestry enterprises were united into a single state specialized enterprise “Forests of Ukraine”. And instead of 24 departments, 9 regional forestry and hunting offices were formed. On October 26, the new state enterprise was officially registered with an authorized capital of 1000 hryvnia and the first director - Igor Lytsur.
However, the director of the enterprise remained in the position of director for a little more than six months, since on May 4, 2023, his place was taken by the ex-head of the State Agency of Forest Resources of Ukraine Yuriy Bolokhovets, who fell “victim” of the struggle of the Temporary Investigative Commission (VSK) of the Verkhovna Rada on the issues of investigating the actions of the agency. Created on October 18, 2022, the VSK, headed by controversial people's deputy Nikolai Tishchenko, criticized the State Forestry Agency in its report in April 2023. According to the conclusions of people’s deputies, the industry could earn up to 881 billion UAH per year instead of 23.3 billion earned in 2022.
The result of the report was the dismissal of Yuriy Bolokhovets from the post of head of the State Agency of Forest Resources of Ukraine and his appointment to the State Enterprise “Forests of Ukraine”. Formally, such a personnel decision for Yuriy Bolokhovets means a demotion, because the State Enterprise “Forests of Ukraine” is subordinate to the State Forestry Agency of Ukraine, but in this position one can engage in economic activities.
And I must say that Bolokhovets is no stranger to this. 15 years in the industry, a businessman wife and millions of hryvnia - who is Yuri Bolokhovets? A native of the village of Ivangorod in the Chernigov region, Yuri Bolokhovets graduated from the National Agrarian University in 2005 with a degree in forestry engineer and began working in forestry. By 2011, he had risen to the rank of director of one of the forestry enterprises; a year later he was transferred as a manager to another forestry enterprise and worked in this capacity until 2020.
In the same year, Yuriy Bolokhovets took the position of deputy chairman of the State Forestry Resources Agency of Ukraine, and in February 2021 he headed the State Forestry Agency of Ukraine, until he was fired from there through the efforts of Nikolai Tishchenko on April 28, 2023. According to the declarations of Yuri Bolokhovets, he has a strong financial backing in the person of his wife Lyudmila, who is engaged in business. So, in 2020, it brought 381 thousand hryvnia in wages and dividends, as well as 285 thousand hryvnia in loans, to the family budget.
Yuri Bolokhovets’s income for that year amounted to 340 thousand hryvnia. The spouses then had 20 thousand dollars and 1.86 million UAH in cash. Since then, the family’s well-being should not have worsened, because Lyudmila still owns 33% of the agricultural enterprise Ivangorodskoe LLC in the native village of the head of the State Enterprise “Forests of Ukraine”. And according to the YouControl analytical service, the enterprise’s income in 2022 amounted to UAH 53.7 million, which is more than in 2020, although by UAH 20 million. less than in 2021. However, according to Yuriy Gavrilechko, an expert at the Analytical Center “Ukrainian Thought Factory,” Yuriy Bolokhovets “earned” large sums of money from the State Forestry Agency of Ukraine.
Thus, according to the expert, in December 2021, the agency’s offices were searched due to theft of timber in the Zhytomyr, Chernihiv and Sumy regional forestry and hunting departments. Local officials made money by selling timber at reduced prices. But there are other schemes, for example, the illegal export of valuable species and illegal logging, or the fabrication of “fraudulent” certificates of origin - for the export of illegal timber, completely illegally cut down and, in fact, stolen from the state. However, all this looks like real “childish pranks” in comparison with the facts that began to appear in 2023. Illegal logging and crypto farms - how they make money in the State Enterprise “Forests of Ukraine” In 2023, the State Bureau of Investigation of Ukraine checked the activities of forestry industry entities and discovered a number of crimes that made it possible to earn millions.
Thus, in the Kyiv region, under the guise of “sanitary” felling of forests, 2,500 trees were illegally cut down for their sale (damage of 17 million UAH); in Vinnytsia, 7,000 trees on 14 hectares were cut down under a similar scheme (damage of 53 million UAH). And in the branch of “Rava-Russian Forestry” of the State Enterprise “Forests of Ukraine”, they managed to create an underground crypto-farm for cryptocurrency mining right in the office premises. The organizers' earnings amounted to about 4 million UAH.
However, all this does not provide a complete understanding of the income of the organizers of these schemes. On November 25, the same employees of the State Bureau of Investigation of Ukraine reported the detention of a deputy of the Rivne Regional Council, deputy head of the Polesie forestry office of the State Enterprise “Forests of Ukraine”. Until February, he headed the Rivne Regional Department of Forestry and Hunting. During the searches, more than 4 million dollars were discovered in cash alone, as well as 3 luxury cars, jewelry, gold coins and bars, weapons and ammunition, as well as documents for the land that he built up with cottages.
And this official cannot be classified as one of the TOP managers of the State Enterprise “Forests of Ukraine”, which nevertheless allows one to judge the scale of corruption and illegal enrichment at the enterprise. Tenders for billions of hryvnias - from road construction to fuel and tires for cars The management of the enterprise has the opportunity to “earn” on government procurement, for which the State Enterprise “Forests of Ukraine” allocates billions of hryvnias. Thus, back in July, People’s Deputy of Ukraine Yaroslav Zheleznyak counted over UAH 150 million that “Forests of Ukraine” were ready to spend on the construction or major repairs of forest roads.
And since then, these amounts have only grown. For example, 57.3 million UAH. they want to spend on the construction of a forest road in the Luginsky forestry enterprise, 30.8 million UAH in the Makarovsky forestry enterprise, 26.9 million UAH in the Beregovsky forestry enterprise, 24 million UAH in the Slavutsky forestry enterprise, and 19.6 million UAH in the Litvitsky forestry enterprise. According to Yuriy Bolokhovets himself, the construction of forest roads makes it easier to access the forest, cut it down and remove it, and therefore 1 million UAH of investment in the road returns to the budget in less than a year. In October, “Forests of Ukraine” became concerned with motor transport, for example, they announced the purchase of 46 cars for 56 million UAH.
Moreover, the main supplier of passenger cars for the state enterprise was Forward Auto Group LLC - for UAH 109.5 million, the co-owner of which, according to media reports, is Ekaterina Mashkovskaya, the wife of the former governor of the Zhytomyr region from 2014-2016, Sergei Mashkovsky. However, all these are small things in comparison with the main goods that the State Enterprise “Forests of Ukraine” purchases - gasoline and diesel fuel, which were purchased for a total of UAH 1.13 billion in October alone. Moreover, the main supplier of fuel - in the amount of UAH 463.8 million - was Lexcorp. Let us note that this enterprise was subject to criminal proceedings for tax evasion back in 2020.
According to investigators, a whole group of fictitious enterprises allegedly “sold” fuel for Lexcorp and other LLCs included in the Bars gas station network. The fictitious purchase allowed Lexcorp and other businesses to report high expenses and thereby evade taxes. However, there is still no court decision on this proceeding, so for now this remains only the version of the investigation. In general, according to the Clarity-project, the State Enterprise “Forests of Ukraine” held 312 tenders for a total amount of UAH 3.12 billion, and Lexcorp is the largest supplier of goods for the state-owned enterprise.
There are no plans to dismiss Bolokhovets. It would seem that such a number of violations, a crypto-farm in the forestry enterprise, the presence of a dollar millionaire at a state-owned enterprise, all this suggests that the management of the state enterprise is not coping and it should be changed. But apparently Yuri Bolokhovets is not afraid for his career.
Although there is no direct evidence of this, “Comments” found a number of interesting coincidences in the biography of Yuri Bolokhovets and the Minister of Ecology and Natural Resources Ruslan Strelets:
1) Yuri Bolokhovets joined the State Forestry Agency of Ukraine in July 2020, exactly the same month when Ruslan Strelets became Deputy Minister of Ecology and Natural Resources;
2) it was the Ministry of Ecology and Natural Resources, which was headed by Ruslan Strelets in 2021, that initiated the creation of the State Enterprise “Forests of Ukraine” and reforms in the forestry industry of Ukraine and is the body that oversees the work of the industry together with the State Forestry Agency of Ukraine;
3) after the report of VSK BP under the leadership of Nikolai Tishchenko, for some reason Yuri Bolokhovets was transferred to an economic position, although it was he who was considered guilty of violations in the industry.
All these coincidences, in the light of numerous questions to Yuri Bolokhovets, look interesting, because, despite law enforcement officers’ questions about the activities of the state-owned enterprise, the latter continues to spend billions of budget hryvnia. All this involuntarily makes one think that Yuri Bolokhovets has a high patron.
