Ukrainian Bureau of Economic Security: Global Problems in Functioning

Ukrainian Bureau of Economic Security: Global Problems in Functioning

Six weeks have passed since Volodymyr Zelensky met with business, promising new approaches and a long-awaited reboot of the Bureau of Economic Security. In a month... Clearly, the business did not imagine this reboot that way, notes ZN.UA.

And the previously underperforming BES is already for the third week entirely without proper leadership. As soon as they appointed a “fresh” deputy director of the Bureau, Andriy Pashchuk, the two former co-chiefs — Eduard Fedorov and Vitaliy Gagach — went on vacation. And then, two weeks later, at least one of them immediately went on sick leave. Moreover, according to ZN.UA, they will not return from vacation and sick leave. So we will try to explain why and for what purpose some in the Office of the President turned BES into a chessboard.

Let me remind you, the first head of the above order-keeping body was former tax police officer Vadym Melnyk. His leadership was as unremarkable as Romana Tryba’s attempt to launch the DSB. But while the headed structure is not a one-man show but quasi-collegial, Tryba “led” in a certain parity with his deputies, BES’s history has been without deputies. Therefore Melnyk could not expect success a priori. He was given two crutches in the form of deputies — first Gagach, then Fedorov.

© Office of the President

Further — more. After BES’s work failed to meet expectations and bring money to the budget, in April 2023 he was dismissed from the post of director, which he had held since August 2021. Melnyk’s dismissal occurred amid months of discussions about rebooting BES. This topic was raised as far back as autumn 2022, when parliamentary committees sent conclusions about BES’s unsatisfactory work to the Cabinet of Ministers. The essence of the complaints is simple.

BES was created as a single body to handle economic crimes, with a strong analytical component. Meanwhile, everyone else still deals with “the economy,” except BES, because former tax police officers and notorious SBU officers settled there, who ruined the analytical direction but deftly revived familiar methods of work. As a result, more than 90% of BES’s open criminal proceedings do not reach court; they are merely invitations to business for a “conversation.” So there are grounds to change something.

Later, a group of people’s deputies submitted bill No. 9080 on rebooting the mentioned law-and-order body. Changes proposed by the bill concern the procedure for appointing the director. According to its provisions, within a year after the appointment of the BES head, all employees must be certified.

It should be noted that even under Fedorov and Gagach, results improved significantly. Although, to be frank, business representatives still have questions regarding BES — in the latest report from the business ombudsman BES is not praised. But at least BES started moving Serious cases, for example, the investigations against Ukrtatnafta’s Kolomoisky or the Regional Gas Company of Firtash. However, in mid-July both Fedorov and Gagach sharply “stood down.” Currently we have reliable information that Fedorov and Gagach wrote resignation letters, and a decision was made on Bankova Street. So the question arises: whom would the Office of the President like to see as BES director?

Today the authorities have two suitable candidates for BES head. The main contender is the head of Kharkiv regional military administration, Oleh Sinehubov. As governor, he has, in the president’s view, proven himself positively and shown that he deserves trust. According to our data, it was from Sinehubov with a large amount of cash that Oleksandr Trukhin departed when he got into a high-profile accident.

The second candidate for the “throne” at BES is the already mentioned Andriy Pashchuk. By the way, according to our sources, he was recommended to BES by the Secretary of the National Security and Defense Council himself, Oleksiy Danilov. But obviously this decision went through Taratov. So it is difficult to say that he is a 100% person of Oleh Yuriyovych, although Pashchuk worked in the Interior Ministry during the time of Minister Yanukovych Zaharchenko. But linear assumptions are not our style of analysis. Remember, at that time Taratov himself worked under the leadership of the former interior minister.

And what about BES itself? First of all, Pashchuk has already fully taken up the work and does not pay attention to the position of the acting director Fedorov, who is currently on sick leave. Competitions are ongoing, but neither Gagach’s people nor Fedorov’s people are being appointed. Pashchuk complies with the demands of the Office of the President — independently making all decisions, disregarding the previous duo, but for now still in leadership. The BES central apparatus, namely its staff, do not really understand what is happening, so they are engaging in an “Italian strike.” The Public Control Council, in fact, is not involved in the competitive selections; this is not our guess but the position of RC members.

Moreover, the global problems in BES’s functioning remain. They have recruited 900 staff, which is definitely not enough. Funding even for this number of detectives, analysts, and others will last only until mid-September. How can more be recruited? How to pay officers’ salaries? With promises? Another thing — re-certification. For the re-certification to take place, funds will be needed again. Why? Because if people are dismissed, as the RC members noted, severance pay will have to be provided. Again, from what funds?

Now about the removal of Fedorov and Gagach. Why did the Bankovaya (presidential administration) make that decision? Because someone from “big business” visited the president, most likely representatives of international structures, who pointed to criminal actions by this duo. No details, nor public scandals, have been heard in recent months. The guarantor of the Constitution summoned Taratov, who promised to sort things out. As a result, Pashchuk — plus, Fedorov and Gagach — minus. Regardless of whether this is correct, we note: Taratov tied himself to solving the problem, gave certain instructions, and added that in case of serious claims against BES there would be a full reboot of the leadership. It seems there were already enough prior complaints...

As a result, bill No. 9080 simply lies in Parliament, a relevant temporary investigative commission chaired by MP Yaroslav Zheleznyak is conducting competitions for vacant BES positions, two former heads are on vacation and sick leave, Oleh Taratov, Deputy Head of the President’s Office, promised to “sort things out,” and is effectively shaping a new configuration of controlled investigations into financial crimes by the Office of the President. Never has anything like this happened before, and here it is again...

And later, final chords of this law-enforcement symphony may surprise everyone. If you listen to voices of high-ranking officials in the criminal justice system, you can hear that head of the Security Service Vasyl Maluk is being courted to lead the Interior Ministry, and Oleksiy Sukhachov, who did not pass the re-certification in the prosecution service in 2019 year, is being considered for transfer to customs. Political sleight of hand at the highest level, and if we set aside the possible Maluk scenario, the other candidates look, to put it mildly, odd.

Bankova still does not understand that, by exchanging professionalism for loyalty, they can lose control over any processes in the state.

In a world that changes at lightning speed, and with the front line situation giving no room for gross mistakes, people who can look at problems from different angles are especially valued. This is helicopter view — to take a broad view, compare different data, and be able to focus on details, “seeing the forest for the trees.”

Author: Oleksandr Liemenov, chairman of the board of StateWatch

Source: ZN.UA