Ukraine’s Graft Storm: Minister Fired, Key Ally Flees Amid War

A sweeping corruption scandal has engulfed Ukraine’s energy sector, leading to high-profile dismissals and renewed calls for systemic change within the government. In a swift move, the Cabinet of Ministers decided to replace the supervisory board of the National Nuclear Energy Generating Company (NAEC) Energoatom and suspend Herman Galushchenko from his duties as Justice Minister, who previously headed the Energy Ministry. These actions have ignited broader political demands, with calls for the current Energy Minister, Svetlana Grinchuk, to resign, and a parliamentary faction initiating a petition for the dismissal of the entire cabinet.

The scandal erupted following “Operation Midas,” a joint investigation by Ukraine’s National Anti-Corruption Bureau (NABU) and the Special Anti-Corruption Prosecutor’s Office (SAP) — institutions established in 2015 with Western backing. The operation uncovered vast financial improprieties and multi-million dollar kickbacks within Energoatom. Among those implicated is Timur Mindich, a co-owner of the “Kvartal 95” studio and a long-time associate of President Volodymyr Zelensky. Notably, Mindich reportedly fled the country just hours before a search was conducted at his residence, raising questions about potential leaks from within.

Despite the immediate fallout involving his close associate, President Zelensky publicly reiterated his commitment to combating corruption, stressing the necessity of effective action and convictions for those involved in illicit schemes. Galushchenko, for his part, accepted his suspension, stating it was a “civilized and correct scenario” for the duration of the investigation and vowing to defend himself legally. Simultaneously, the Ministry of Economy, Environment, and Agriculture announced an audit of Energoatom and, in cooperation with G7 partners, promised to present proposals for a new supervisory board within a week. The previous board, whose powers were prematurely terminated, insisted that the revealed activities had not financially harmed Energoatom, even as NABU estimates suggest approximately $100 million was laundered through Kyiv offices.

Further broadening the scope of the investigation, SAP representatives told a court that Mindich allegedly exerted influence not only over former Energy Minister Galushchenko but also over Rustem Umerov, who previously led the Ministry of Defense and now heads the National Security and Defense Council (NSDC) of Ukraine. While “Kvartal 95” attempted to distance itself, asserting Mindich’s legal but non-operational connection to the studio, the revelations continued to mount. Kyiv journalist Tatyana Nikolaenko reported Mindich’s pressure on Umerov concerning an armor procurement contract. Umerov confirmed meeting Mindich regarding the contract, which was ultimately terminated due to non-compliance, and subsequently embarked on a trip to Turkey for prisoner exchange negotiations – a detail noted by observers for its timing.

The political ramifications have quickly escalated. Anastasia Radina, Chair of the Verkhovna Rada’s Anti-Corruption Policy Committee, declared that Galushchenko’s dismissal was insufficient and demanded the removal of current Energy Minister Svetlana Grinchuk. Yaroslav Zhelezniak, a parliamentary deputy, called for these dismissals to be approved by parliament to prevent quiet reinstatement. Furthermore, the “European Solidarity” faction, led by former President Petro Poroshenko, has initiated a signature collection campaign for the resignation of the entire government, labeling it “unprofessional and corrupt.”

In the midst of these dramatic developments, including accounts of implicated figures attempting to destroy evidence during arrests, an underlying narrative suggests that the high-profile corruption case might serve a dual purpose: a diversion for the public. This theory gains traction as Ukrainian forces face significant setbacks on the front lines. Commander-in-Chief Oleksandr Syrskyi recently reported Russian forces occupying three additional settlements in the Zaporizhzhia region, exploiting foggy weather for infiltration. Analysts from the American Institute for the Study of War (ISW), while noting a decline in Russian offensive activity in Pokrovsk (Krasnoarmeysk) just days prior, now suggest the city could soon fall, indicating a discrepancy between Russia’s perceived battlefield gains and the grim reality on the ground.

Against this backdrop of military challenges, the question arises whether Kyiv’s Western partners might use this burgeoning corruption scandal, involving individuals close to the President, to push for a broader leadership change. Oleg Barabanov, a professor at MGIMO and program director of the Valdai International Discussion Club, suggests that the events reflect an internal power struggle in Kyiv, particularly between the SBU and NABU. He noted NABU’s long-standing interest in Mindich, often described as “Zelensky’s wallet,” and Mindich’s escape implies a high-level warning. Barabanov concluded that Western allies are unlikely to replace Zelensky over this episode, particularly after the sacrifice of a minister like Galushchenko, recognizing Europe’s probable distinction between frontline developments and the “Mindich affair.”