Operation ’Midas’: high-level criminal organisation operating in energy sector exposed (PHOTOS)

NABU and SAPO have exposed a criminal organization comprising current and former officials, a well-known businessman, and other individuals. Its members had developed a large-scale corruption scheme to influence strategic state-owned enterprises, particularly JSC ‘NNEGC ’Energoatom’, to obtain unlawful benefits and launder money.

Currently, in accordance with Article 208 of the Criminal Procedure Code of Ukraine, detectives have detained five individuals and notified seven members of the organization of suspicion, including:

• a businessman — the head of the criminal organisation;
• a former advisor to the Minister of Energy;
• the executive director of physical protection and security at JSC ‘NNEGC ’Energoatom";
• four individuals — back-office ‘employees’ involved in laundering the funds.

Applying to the court for preventive measures is in progress.

The scheme

The main activity of the criminal organisation was the systematic receipt of illegal benefits from Energoatom's contractors in the amount of 10% to 15% of the contract value. In particular, Energoatom's contractors were forced to pay kickbacks to avoid having payments for their services/products blocked or losing their supplier status. This practice was called ‘shlahbaum’ ('barrier').

To implement the scheme, the head of the criminal organisation involved the former Deputy Head of the State Property Fund, who later became an advisor to the Minister of Energy, and a former law enforcement officer who held the position of Executive Director for Physical Protection and Security at Energoatom. Using their official connections in the ministry and the state-owned company, they ensured control over personnel decisions, procurement processes, and financial flows.

In fact, the management of a strategic enterprise with an annual income of over UAH 200 billion was carried out not by state officials, but by third parties who had no formal authority, though took on the role of ‘overseers’ or 'shadow managers'.

Legalisation

The function of legalising illegally obtained funds was entrusted to a separate office of the criminal organisation located in the centre of Kyiv. The premises belonged to the family of former Ukrainian MP and current russian senator Andriy Derkach, who NABU and SAPO accuse in another criminal proceeding.

This office kept strict records of the funds received, maintained ‘black accounting’ and organised money laundering through a network of non-resident companies. A significant part of the operations, particularly the cash issuance, was carried out outside Ukraine.

For providing services to non-members of the criminal organisation, the office received a percentage of the amounts processed.

In total, approximately USD 100 million passed through the so-called ‘laundry’ as its activities were documented.

Operation

The special operation to document the activities of the criminal organisation lasted over 15 months, starting in the summer of 2024. During this time, a large amount of data was collected, and thousands of hours of audio recordings were obtained. NABU and SAPO are assessing the actions of all participants in these materials.

At the final stage, almost all of the detectives of the National Anti-Corruption Bureau were involved in the operation.

By court order, more than 70 searches were conducted in Kyiv and other regions, and a significant amount of documents and cash were seized.

NABU detectives and SAPO prosecutors continue to identify other members of the criminal organisation. The investigation is ongoing.