Ukraine audit reveals procurement embezzlement of $2bn

Widespread embezzlement in state procurement and services has cost the Ukraine approximately $2 billion, a recent audit has revealed.

The Ministry for Economy of Ukraine (MoE) played the key role in the embezzlements, according to Petro Andreyev, head of the State Financial Inspection of Ukraine (SFI), who conducted the audit. 

In 2008-2009, the Cabinet of Ministers of Ukraine issued 60 orders, enabling customers to avoid using mandatory procurement procedures. In most cases, the ordinances were initiated by the MoE.

The former Minister of Economy issued the letters to the Ministry of Emergency Situations approving the purchase of fire engines and ambulance vehicles totaling about $32m, which let MES avoid issuing a tender on the premises of "absence of competition." Afterward, Ministry of Emergency Situations purchased 27 ambulance vehicles, causing losses to the state budget in the amount of approximately $2m" said a statement from the SFI said.

The ex-prime-minister's political party BYuT dismissed the accusations, claiming that the inspection is "aimed at defamation of the opposition and using a so-called case-based reasoning to conduct repressions."

The misuse of public funds takes up to one-third of all identified violations, according to Petro Andreyev, head of the State financial inspection of Ukraine.

Andreyev noted that similar violations took place on "multiple occasions" including the one in the city of Shostka during the repairs of the public heat supply system, and in Kyiv during the construction of the security data processing center for EURO 2012, as well as during installation of auxiliary subsystems including video surveillance, traffic moving detectors, automatic traffic control system.

Read more here.