The Prosecutor’s Office has intensified its activities: searches were conducted at the Kyiv City State Administration (KMDA), the State Architectural and Building Control (DABK), «Kyivzelenbud» (Kyiv Green Construction), «Kyivavtodor» (Kyiv Road Service), and the «Special Housing Fund»

12.05.2021

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After the May holidays, the Kyiv City Prosecutor’s Office actively targeted the municipal enterprises and departments of the KMDA. Searches were announced simultaneously in several capital agencies

Searches in the departments of the Kyiv City State Administration | Photo by the Prosecutor’s Office.

On the morning of May 12, 2021, the Kyiv City Prosecutor’s Office announced searches in the premises of the Kyiv City State Administration (KMDA) and in the office of a private enterprise. According to the photos provided by law enforcement, they visited the Department of State Architectural and Building Control (DABK).

Jointly with the State Fiscal Service in Kyiv, searches are being conducted in the premises of the KMDA, as well as in the office of a private enterprise and at the place of residence of its director, as part of the investigation of a criminal case related to causing damage to the city budget of almost UAH 19.5 million. Pre-trial investigation has established that in 2013, the director of the private enterprise, upon acquiring real estate located on communal land, deliberately did not conclude a lease agreement for the land plot and used it free of charge. According to the expert conclusion, these actions caused damage to the territorial community of Kyiv in the amount of almost UAH 19.5 million, stated the Prosecutor’s Office.

It is reported that as part of the criminal investigation, searches were carried out on Wednesday in the premises of the Kyiv City State Administration, whose officials may be involved in the mentioned violations. «The results of the investigative actions will provide a legal assessment of the actions of KMDA officials who took no measures to conclude the necessary lease agreements with the land user», – stated the press service of the Kyiv City Prosecutor’s Office.

Case «Special Housing Fund»

In the morning, the press service of the Kyiv City Prosecutor’s Office reported on searches in the office of the Municipal Enterprise «Special Housing Fund» (KH «Spetszhytlofond»), whose employees are suspected of embezzling 10.5 million hryvnias ($375,000).

«The Podil District Prosecutor’s Office of Kyiv, in collaboration with the State Bureau of Investigations (SBI) in Kyiv and the National Police of Ukraine, is conducting searches in the office of the Municipal Enterprise ‘Special Housing Fund’ and in the premises of subordinate organizations as part of a criminal investigation initiated regarding the misappropriation of funds amounting to over 10.5 million hryvnias. According to the investigation materials, between 2018 and 2020, a series of subcontracting agreements for construction work were concluded between the Municipal Enterprise ‘Special Housing Fund’ and a subcontracting organization. During the investigation, it was established that the head of the subcontracting organization conspired with the officials of the Municipal Enterprise «Special Housing Fund», who signed acceptance certificates for completed construction work without their actual completion in full scope and quality», – the statement said.

«Kyivavtodor» and «Kyivmisksvitlo»

On the evening of May 12, information emerged that the prosecutor’s office, in collaboration with the State Fiscal Service (DFS), conducted searches in the corporation «Kyivavtodor» as part of a criminal investigation initiated on the grounds of intentional tax evasion during road repair works in Kyiv, amounting to over 18 million hryvnias ($650,000). Similar searches were carried out in the Municipal Enterprise «Kyivmisksvitlo», where a scheme of intentional tax evasion during lighting replacement works in the capital was uncovered, involving an amount exceeding 12 million hryvnias ($430,000).

«According to the investigation materials, a private company, a regular winner of tenders commissioned by the Communal Corporation «Kyivavtodor», totaling over 1.9 billion hryvnias, carried out road repair works in the capital. During this process, the subcontracting organization, acting in collusion with officials of «Kyivavtodor», included details of apparently fictitious enterprises in the financial documentation, ostensibly engaged to perform subcontracted works. During the searches conducted in the subcontracting organizations involved in the illicit scheme, primary documents, cash in the amount of over 7 million hryvnias, computer equipment, and company seals were identified and seized», – stated the evening press release from the Kyiv City Prosecutor’s Office.

In the office of ‘Kyivmisksvitlo’ | Photo by the Prosecutor’s Office

About what is happening with road repairs in Kyiv, you can read, for example, in the article «Active Citizens» – «The Year of Reconstruction of Tupolev Street: Reconstructed, Reconstructed, but Not Fully Reconstructed».

«According to the investigation materials, with the aim of inflating the cost of works and subsequent receipt of cash (the so-called «kickback’ scheme), the mentioned enterprises, in collusion with officials of the Municipal Enterprise «Kyivmisksvitlo», conducted financial and economic operations with companies showing signs of fictitious engagement supposedly for subcontracted works on illuminating the capital», – as stated regarding the searches at the Municipal Enterprise «Kyivmisksvitlo». One of the abuses of this structure was reported by our colleagues in the publication «In Kyivmisksvitlo, they don’t know where they put the lanterns from the end of the 19th century».

Valuable Kyiv Parks

Against the backdrop of media reports and based on the analysis of documents on the civil control service of public procurement DoZorro, regarding the preparation by the Kyiv authorities to allocate over 0.5 billion hryvnias ($19 million) this year for the extensive reconstruction of the «Central» recreation area on Trukhaniv Island, the prosecutor’s office has announced searches in the Municipal Enterprise «Kyivzelenbud» regarding financial crimes during the reconstruction of almost all parks in the capital.

Searches at the Municipal Enterprise “Kyivzelenbud” | Photo by the Prosecutor’s Office

Kyiv City Prosecutor’s Office, together with the State Fiscal Service in Kyiv, is conducting searches at the premises of the Communal Enterprise «Kyivzelenbud» and the offices of subcontracting enterprises as part of a criminal investigation initiated on the grounds of intentional tax evasion during the reconstruction of city parks, totaling over 30 million hryvnias.

According to the investigation, LLC «Eurotechnologies Group», «Budmontazhservice», and «Prombudmehanizatsiya», from 2019 to 2020, carried out construction and reconstruction works in parks, including «Natalka», «Sovky», «Veselka», «Kurenivsky», and others, commissioned by the Kyiv Communal Association for Green Construction and Maintenance of Greenery «Kyivzelenbud». These subcontracting organizations, in collusion with officials of «Kyivzelenbud», allegedly engaged fictitious enterprises in the financial documentation, indicating their involvement in subcontracted works. This allowed them to evade paying taxes on a particularly large scale», – the statement said.

On May 11, 2021, based on a court decision at the addresses of the scheme organizers’ residence, searches were initiated in the offices of the mentioned enterprises, including «Kyivzelenbud», to find primary financial documents and record information about the circumstances of committing criminal offenses. Subsequently, the prosecutor’s office may also be interested in the estimates for works in city parks and squares, which, according to many experts, are significantly overstated.

For example, after the reconstruction of the Rusanivskyi Canal along Florence Street in 2018, Kyiv Local Prosecutor’s Office No. 3 reported suspicions to the former director of the subcontracting enterprise for embezzling 1 million hryvnias allocated for the capital repair of elements of the Rusanivskyi Canal improvement. Overall, what the community gained after that reconstruction, amounting to 17 million hryvnias ($600,000), is detailed in our material «Inspection No. 2: Florentsiiska Embankment, where stalls are being installed at our expense».

After the reconstruction, Rusanivska Embankment at the cost of 17 million hryvnias

And such a situation with the appropriation of large sums of money and the execution of substandard work, or their incomplete execution, can be observed in every park and square in Kyiv. Check out our material «Inspection No. 5: Reconstruction of Natalka Park in Obolon for 200 million hryvnias, and this is not the end».