Ukraine environment minister, two senior officials fired over Kyoto cash corruption charges

Published 22:52 on January 27, 2016  /  Last updated at 13:50 on January 28, 2016  /  EMEA, International, Kyoto Mechanisms  /  No Comments

Ukraine’s acting minister of environment and natural resources Serhii Kurykin and two senior officials have been fired for allegedly attempting to embezzle 550 million Hryvnia ($22 million) in Kyoto Protocol revenues, the government said on Wednesday.

Ukraine’s acting minister of environment and natural resources Serhii Kurykin and two senior officials have been fired for allegedly attempting to embezzle 550 million Hryvnia ($22 million) in Kyoto Protocol revenues, the government said on Wednesday.

Ukraine’s director of the environment ministry’s climate policy department Vladyslav Vezhnin and the CEO of state-run green investment firm Ukrekoinvest SE Oleksii Koval were also sacked following an investigation, according to a government news website.

Ukrainian Prime Minister Arseniy Yatsenyuk has urged the chief of the National Anti-Corruption Bureau of Ukraine (NABU) “to bring this high-profile corruption case to an end, and to sentence officials responsible for this crime,” the statement said.

The men are accused of corruption relating to a scheme that involved Ukraine using the proceeds of Kyoto emissions rights sales to install energy efficient LED lighting on streets and in public areas.

A tender was held last year to award the contract to install the LED devices, with 75% of the funds scheduled to be transferred by the government to the winner before the end of December.

It is not clear if the case is linked to Japan’s request to have Ukraine return an undisclosed amount of unused funds that it received from selling Assigned Amount Units (AAUs) to Japan under Kyoto’s first commitment period, which ran from 2008 to 2012.

BOGUS COMPANY

Ukraine’s Cabinet of Ministers on Wednesday was presented the findings of the investigation, which centred on the tender’s winner – a suspicious firm called Ahrotekhbud that was registered to a residential apartment in Donetsk.

“It was found that Ahrotekhbud … had all the features of a dummy [firm],” the government said, adding that in 2015 the company “managed to buy a ventilator for UAH 13,000 ($521).”

“The prime minister noted that [of the] eight companies [that participated in the tender], six were real companies working in the field of lighting and with tens of millions [of Hryvnia] in turnover, and the [other] two were completely identical [and] fictitious.”

“There is no director and chief accountant. It is registered as a phantom [company and] just has a bank account.”

“Real companies lose the tender, and here appears a firm from Donetsk ‘with one ventilator,’ which expects from the state budget a sum worth UAH 550 million, … [and] the ministry of environment and natural resource submits a decision at a government session to transfer the funds on a prepaid basis. Unless we had responded quickly, the sum … would have gone to the dummy company,” Yatsenyuk was quoted as saying in the statement.

“It is an organised crime group with involvement of top officials of the ministry, [and] of the head of the state-owned enterprise”, he added.

The government gave no further details about the case or the alleged involvement of the three men.

Yatsenyuk instructed the head of NABU to initiate criminal proceedings against the men and to prevent them from fleeing Ukraine.

Kurykin was appointed as Ukraine’s acting environment minister last summer following the dismissal of former minister Ihor Shevchenko, who left office amid a separate investigation into corruption at the ministry.

Ukraine has had a tough time on the environmental front over the past few years.

In 2011, former Prime Minister Yulia Tymoshenko was jailed following similar accusations by rival Viktor Yanukovich that included misappropriating at least €200 million in AAU sale proceeds.

And a few yeas after briefly being suspended from carbon trading under Kyoto, the country in 2015 failed to retire enough emissions units to comply with the pact, making it the only of Kyoto’s signatory governments to be in non-compliance, even though it held a sufficient number in its UN registry account.

By Mike Szabo – mike@carbon-pulse.com

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