27 June 2010

Khoroshkovsky - The right man for the job.

Valeriy Khoroshkovsky – Head of the SBU (State Security Service of Ukraine).

As I have said many times before, the media should stop trying to find a problem with Valeriy Khoroshkovsky and focus on the real work the SBU is now undertaking to fight corruption and other criminal activities in Ukraine. Let’s face it the Police and Ministry of Internal Affairs have done very little in the past.

Under the new leadership of Khoroshkovsky the SBU will get results and bring many people to justice. We will not find cases being dragged on forever, hoping that someone will just forget about it, as previously.

Khoroshkovsky will focus on getting results and he is very good at this. Moreover, it’s maybe a good thing having a multimillionaire as Head of the State Security Service. He does not need to take any bribes from anyone. He does not need to cover up anything.

Admittedly he knows how to use media and press conferences to full effect and why not. This past week has shown a few examples of the work carried out by the SBU in Ukraine.
Here are some examples:

Olympiysky National Sport Complex. This complex is currently under development in preparations for the Euro 2012 Games. No surprise maybe that the former Director General of the complex has been charged with embezzling UAH 10.8million (Approx USD1.4m). We know that many Ukrainians just cannot help themselves from stealing money.

Rodovid Bank. The SBU detained the former administrator of the bank and charged him with embezzling UAH 340 million (Approx USD43m) – Apparently USD38m of this was paid to a firm for ‘legal services’.

Naftogaz Ukraine. Ihor Didenko the former First Deputy CEO of Naftogaz Ukraine has signed an undertaking not to leave the city of Kyiv, after being charged with embezzlement relating to 11 billion cubic metres of gas, involving UAH33.9 billion.
The former Head of the State Customs Service of Ukraine- Anatoly Makarenko was also arrested on 23 June in relation to the same charges.

Feedback I have from people doing business where government officials are involved is that government employees are very afraid now. They are worried about who is watching them and they think that every transaction is an ‘SBU sting operation’ designed to catch them being involved in corruption.

From our point of view (normal western thinking I mean), we would say, why worry?. If you are not doing anything illegal?. Sadly the situation is different in that the vast majority of government employees including their bosses rely heavily on the ‘extra payments’ they receive everyday as part of their job. Losing this extra income will be difficult for them. But this will be the painful process of trying to fight corruption in Ukraine. Not easy.

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