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Olena Halushka​: What are the roadblocks for e-declarations verification?

Late October 2016, reformers were celebrating a true anticorruption breakthrough. In spite of some 12 creative attempts to kill electronic system of asset disclosure it was fully launched and all the top officials of the state were forced to submit e-declarations. In fact, it is this specific reform that played a key role in unfreezing visa liberalization process with the EU which had stalled due to the doubts of some member states in genuinity and consistency of the Ukrainian reforms.

But is this reform indeed effective? Almost a year passed, but except comprehensive transparency that uncovered millions of dollars being stored in the houses of lifelong civil servants nothing has really changed. Nobody was brought to justice. And it is fully the responsibility of the National Agency for Corruption Prevention that such a promising and advanced anticorruption tool may end up as a stage requisite that points on the disease but unable to cure it.

Existing problems

According to the law, it is the Agency for Corruption Prevention that administers the e-declarations system, ensures verification of e-declarations and initiates bringing officials to justice for false statements and illicit enrichment. In reality, the Agency fails to perform its functions using different pretexts. First, the Agency for months couldn’t have approved the procedure regulating verifications. Then they claimed that it takes too long to manually verify e-declarations and complained that there was no automatic system integrated with other state registries and databases that would allow checking declarations in bulk. In the meantime, they are also not satisfied with the subject law and are working on amending it.

Consequently, as of late July 2017, full verification of declarations of only 244 officials started with 32 cases completed. Needless to remind that this is out of more than 1 million e-declarations that are so far submitted. Upon the results of full verification materials 4 cases were forwarded to NABU for criminal investigation, in the rest cases no fraud, signs of illicit enrichment or conflict of interests were identified. Agency’s website reports that 276 administrative claims were sent to courts with 180 upon analyzing political parties’ reports, 67 for violation of conflict of interests, 28 for untimely submission of e-declarations and 1 for prevention and detection of corruption.

In the meantime, the Agency fails to see the violations even in cases when the investigation was done for them. AntAC has filed a number of notifications to the Agency providing evidences and grounds for starting full verification of declarations of specific officials, but most of Agency’s answers were typical and demonstrative: no grounds for verifications. Thus, in a few cases it informed that according to the law full verification of declarations is to be done following Agency’s appropriate decision, which should be taken within 15 days after public notification is received. Within legislatively established time period the decision regarding an official mentioned in the notification was not taken. And that’s it. No more deadlines – no more problems.

Such an inefficiency of the Agency also causes some troubles to NABU, which already investigates 72 cases, opened on its own initiative upon analyzing the e-declarations. Thus, to allow further investigative measures in some cases SAPO demands Agency’s opinions on their e-declarations. And since it fails to provide them, the cases get stalled.

More obstacles to be created

Although current situation is not good at all, the Agency intends to do even worse.

On Sept. 7 it organized a roundtable to discuss the amendments to the procedure of e-declarations verification. If adopted, they will complicate bringing corrupt officials to justice.

Thus, Agency intends to introduce following novelties:

  • checking the signs of illicit enrichment to be done via automatic verification only.

Automatic verification provides for comparing the figures and information of the e-declarations with corresponding information of other state registries and databases, without any extra research or analytic activities. Checking the signs of illicit enrichment should be done via full verification only, as provided for by the law, because officials’ property may not be indicated in the registries or can be situated abroad.

If approved, this proposal will neglect any possibility to detect illicit enrichment and respectively bring officials to justice.

  • introduction of a 20-day “preparation” period to verify an information which the Agency receives from NGOs or journalists in the form of notifications regarding false statements or illicit enrichment of public officials. After this period expires the Agency is to decide whether to check the e-declaration or not.

In addition, the Agency intends to deprive NGOs or journalists of the right to appeal in the court Agency’s refusal to verify e-declarations.

Such a provision would create an enormous space for abuse. Moreover, if no violations are identified within the 20-day period, the Agency gets grounds for refusal to start verification of the e-declaration, which can’t be further appealed or challenged.

  • stop counting the term for verification if the person who performs it goes on vacations, a business trip or a sick leave.

This also poses a threat to consistency of the process. To avoid such a problem 2-4 persons should be authorized for each specific case to be able to substitute each other if necessary.

  • extending the general term for verifications for up to 6 months, and the term for formulating of verifications results for up to 1,5 months.

As of now legislatively provided terms are fair and favorable enough – 60 days for verifications and up to one month for formulating, there are no reasonable grounds to change them.

In addition, AntAC has proposed that if the Agency refuses to start verification upon the notification of the NGO it is obliged to provide it with a groundful explanation of the reasons. Moreover, it is also important that the Agency verifies whether the declarant is using the property which officially belongs to the company corporate rights of which the declarant has. Both recommendations were negatively perceived by the Agency.

What’s next?

Tactically it is important to ensure the Agency does not approve the procedures that threaten verifications process.

Strategically it is obvious that the Agency fails to do its work not because of the lack of capacities, but due to unwillingness. And unless the comprehensive reform of the Agency is done, each and every result would be pulled out of it in a struggle. Therefore, in order to get real and tangible outcomes, we are convinced that the powers to conduct full verification of e-declarations of top officials who are under NABU jurisdiction should be transferred to NABU. Given its independence and capacities, and taken into account that it already has an integrated automatic system of verification that is fully operational, NABU will complete this task in a few months.

Full verification of e-declarations is one of EU’s burning demands which Ukraine has to fulfill to receive the last tranche of the macro-financial assistance of 600 million euros. Close monitoring of international partners and the civil society over this reform and uncompromising demand it to be fully completed are crucial for the future success of this joint achievement.

Olena Halushka, international affairs manager at AntAC. Op-ed first published on 21 September at KyivPost