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Following the e-declarations – What comes next? Ukraine

November 1, 2016

A few hours before the deadline for mandatory completion of e-declarations for the Ukrainian political class and top civil servants, an entry appeared raising the issue of the large sums of physically held cash by individuals submitting the returns.

Whilst the ever-cynical Ukrainian humour swiftly arrived at e-guidance for the elites when it came to suitable storage for their loot, a policy decision regarding what to do next with regard to the cash issue had yet to be announced.

On 1st November Prosecutor General Lutsenko announced that those who had declared $100,000 or more in cash would be subject to investigation with regard its provenance.

Further those that had declared gifts of over $10,000 or who declared more than $100,000 in the bank would have their tax affairs scrutinized.

Those catchment parameters therefore include well over half the Verkhovna Rada and numerous civil servants.  In short several hundred people (most with parliamentary immunity) will now be subject to investigation by NABU as they fall within the NABU parameters according to statute.

NABU has only 300 detectives and is already investigating hundreds of cases – as well as fighting a rear-guard action with the Prosecutor General’s Office to defend its statutorily ring fenced areas of exclusive anti-corruption competence within the elite.

With effect from the announcement of Yuri Lutensko, it will now have several hundred more investigations to conduct – most of which will go nowhere for reasons outlined in the earlier entry linked above.

This notwithstanding a second e-declaration phase that runs from 1st January to 1st April 2017 for those who hold senior positions within the State Owned Enterprises (SOEs) – and there are more than 1000 SOEs.  Ergo of several thousand more e-declarations there will be several hundred that will declare cash/bank/gift figures that will automatically trigger more investigations – again many of which will go nowhere.

In the meantime many other corruption cases will arise that are also the legislatively identified as falling within the exclusive investigative territory of NABU.

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Clearly there are only so many hours in a day, only so many days in a week, and only so many trained NABU detectives – and yet the entire point of the legislation that provides exclusive investigative ground for NABU is to prevent the Prosecutor General’s Office (and the political class) from polluting, interfering or tampering with corruption investigations within the elites.  For the sake of NABU integrity and public perception, notwithstanding retaining the support of “friends of Ukraine”, the legislative ring fencing cannot be dismantled.  The exclusivity equates to accountability.

There was always going to be a tidal wave of corruption investigations that would hit a newly formed NABU immediately after its creation.  Whether the size of that tidal wave was ever realistically assessed when its organisational size and scope were planned and brought into being is perhaps subjective.  Quite how a reader measures corruption is perhaps dependent upon what their definition of corruption is, and thereafter plucking a guestimate from thin air regarding the frequency of new corrupt acts and the depth of historically corrupt acts that also require investigation.

It also has to be acknowledged that NABU will eventually get past the initial investigative tidal wave and reach a far more manageable number of on-going cases at any particular time.

The 2017 budget does include an increased budget for NABU – but each investigation naturally has a budgetary cost.  Therefore that increased budget does not necessarily equate to more trained personnel joining the NABU ranks, on-going training, new equipment etc, for that budgetary increase may yet prove to be insufficient for the rapidly increasing number of investigations.

Ergo in meeting this current corruption investigative tidal wave, the answer may not be as simple (or budgetary possible) as employing and training more detectives by the dozen.  The answer will certainly will not be found in taking down the legislative ring fencing that NABU investigative territory enjoys if public and international perceptions are to be favourably maintained.

The answer may well be most (cost) effectively found in patience – and a lot of communication between NABU and the constituency to insure faith that such patience will be rewarded with cases that can realistically be won reaching the courtroom.

Whatever the ultimate outcomes of e-declaration, at least insofar as investigative measures, those parameters are now clear.

Patience is now required – as is the anticipation/expectation that very few investigations will actually lead to winnable cases reaching a courtroom – and even fewer resulting in the finding of guilt.

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