The Ukrainian Cabinet of Ministers discreetly dethroned the former czar of drone purchases — Digital Transformation Minister Mykhailo Fedorov — as the result of a one-sided power struggle from the Head of the President’s Office, Andriy Yermak, allege observers.
A new decree shifted a key office in the drone purchasing process away from Fedorov, and the new leader of the office is, say anti-corruption watchdogs, a yes-man for Yermak, President Volodymyr Zelensky’s closest ally who has attracted controversy over his ever-growing influence and overreach.
Critics fear the responsible agency may stop reporting details on over a billion dollars a year of government drone contracts, leaving them vulnerable to embezzlement.
Before February 2022, Fedorov was mostly occupied with putting government services onto mobile apps, as well as improving the lives of Ukrainian techies and IT workers. At the outset of the war, he was early to spot the increasing use of drones by Ukrainian soldiers to make up for the lack of air power and reconnaissance.
From his position at the center of a network of recently militarized techies following Russia’s invasion, Fedorov became the face of a new “army of drones,” a government initiative launched in July 2022 to supply the Ukrainian military with unmanned aerial vehicles.
The popularity of such drones was slow to break through the traditional defense apparatus. Then-Defense Minister Oleksii Reznikov downplayed the role of civilian drones in military operations, saying in December 2022, “Let’s not idealize these Mavics. I don’t have Mavics in my orders, just so you understand. Soldiers aren’t asking for them,” making fun of them as drones for filming weddings rather than fighting wars.
At the time, soldiers were actually sourcing donations for Mavics, with Ukrainian civilians pitching in to send them to their favorite units. Due to Reznikov’s attitude, Fedorov ended up spearheading government drone procurement.
For his wartime work, Fedorov has become a major public persona within Ukraine and abroad, including a glowing profile in Wired magazine. He hosted a short-lived YouTube series, welcoming private start-ups to the ministry. Fedorov also drove the set-up of Brave1, which links his ministry and the Defense Ministry to sponsor military technology.
For his wartime work, Fedorov has become a major public persona within Ukraine and abroad.
Despite Fedorov’s role, the actual budget for the government’s drone purchases initially ended up not in the hands of the Defense Ministry nor the Digital Transformation Ministry, but rather with the State Special Communications Service of Ukraine.
The Communications Service is the agency in charge of securing government and military communications and cyber defense. The Cabinet of Ministers granted Fedorov semi-formal authority over the long-overlooked Communications Service as it underwent reforms starting in 2020.
As fundraising money flew into Ukraine following Russia’s invasion, the Communications Service ended up holding the purse strings for drone fundraising by United24, a Ukrainian-government-run platform to raise money for the war effort. The situation was enshrined into law in June.
The Communications Service found itself in possession of a considerable war chest as a result of these changes. The agency’s budget for next year includes Hr 46.9 billion — about $1.125 billion specifically allocated to drones.
The service retains that drone money in a special fund far larger than its regular budget. That fund also dwarfs the size of the whole budget for the Digital Transformation Ministry, which is just under Hr 2.5 billion — about $60 million.
The service has seen scandals in the past. Former head Yuriy Shchyhol along with his deputy, Viktor Zhora, were arrested for embezzling Hr 62 billion in software last November.
A year later, the Communications Service saw another shake-up of leadership and, as a result, control over that billion-dollar drone budget.
Fedorov’s appointee Yuriy Myronenko announced his surprise resignation from his post as head of the Communications Service on Nov. 15. Myronenko was appointed to lead the agency in charge of drone procurement after its previous head resigned amid embezzlement allegations. He himself is a former commander of a drone company in the Ukrainian Armed Forces.
Upon resignation, Fedorov took Myronenko into his team: Myronenko was appointed digital transformation vice minister, under Fedorov.
Meanwhile, all eyes were on who would replace him at the Communications Service and be in charge of the rich drone budget.
Oleksandr Potiy, longtime deputy chief of the Service, took over the job soon after Myronenko’s resignation. The service subsequently named Rostislav Zamlynsky as Potiy’s deputy.
Just a few days later, the Cabinet of Ministers formally established that the Communications Office would report to the cabinet itself, not to Fedorov’s Digital Transformation Ministry.
Critics, including anti-corruption activists and journalists, were quick to allege that the changes indicate that the lucrative and popular direction of drone procurement was effectively taken over by the allies of Andriy Yermak, head of Zelensky’s office.
New leadership and alleged Yermak connections
The relationship between Yermak and the new leaders of the Communications Service is not direct but widely treated as fact by critics.
“Potiy’s a basic guy from the military. He’s very much under the president’s office,” Valeriia Radchenko, a communications officer at the Anti-Corruption Action Center tells the Kyiv Independent. “There will be no super direct connections. These guys are smart enough not to put their own classmates in these positions.”
“He’s a man of Yermak’s team,” says Yuriy Nikolov, a Ukrainian journalist and investigator.
Mariana Bezuhla, a member of the Verkhovna Rada, Ukraine’s parliament, also named the ouster at the Communications Service the latest of the “intrigues of Yermak” in a Dec. 11 Facebook post. Bezuhla is a former member of Zelensky’s party who was excluded from it at the start of 2024.
“Andriy Yermak thinks politically and sees Fedorov as a competitor. The prospect of a young, ambitious, and independent Fedorov in the role of defense minister is Andriy Borisovych (Yermak)’s nightmare,” Bezuhla continued, referring to Fedorov’s wartime advancement from an initially technological station and his recent moves to expand the influence of drones across the Defense Ministry.
Nikolov also points at Yermak allegedly seeing Fedorov as competition and the last standing member of the president’s original circle.
“When Yermak went into the president’s office in 2020, he cleared out everyone who helped Zelensky win in 2019,” Nikolov told the Kyiv Independent, noting Fedorov as one of few who survived.
Others pointed at Zamlynsky, the new deputy head of the Communications Service. His previous tenure was in the Defense Ministry at the time when it was shaken by procurement scandals.
Kollen Post
Editor-in-Chief of Ukrainian news outlet Censor.Net Yuriy Butusov likewise portrayed the Communications Service reshuffle as an unambiguous power grab on the part of Yermak in a Nov. 24 Facebook post. Butusov has been an outspoken critic of Zelensky and Yermak.
“The Head of the President’s Office, (Andriy) Yermak, will busy himself with the drones, but the money will be allocated by the bureaucrat who controlled the finances under Reznikov,” Butusov wrote, illustrating Fedorov’s recent efforts to expand the influence of drones across the military.
Butusov pointed to new officials who Fedorov had put forward to the chain of drone command, including a vice minister of defense and Vadym Sukharevsky as the first commander of Ukraine’s new Unmanned Systems Force.
“As soon as Fedorov gave voice to this plan, Yermak became his fatal enemy. Yermak tries to control all internal policy.”
"As soon as Fedorov gave voice to this plan, Yermak became his fatal enemy."
For his part, Fedorov put out an eminently diplomatic statement on his Telegram channel, saying that the stable of ministries said to be jockeying over drone acquisitions have “one common goal — to defend the country.”
“Please, without the attempts to turn the institutions of government against each other through planted information, rumors, and hunts for empty sensationalism that nobody needs,” wrote Fedorov.
The concrete consequences of the change-up remain uncertain. Bezuhla claimed that a shortage of drones is already apparent at the front, and that “purchases and developments in the sector have fallen critically — literally over the course of a month by several times. Meanwhile, the Defense Ministry, over the whole of 2024 has purchased almost no drones.”
Public concern is so great that the Service has spent the first half of December releasing a series of announcements assuring that “the delivery of drones to the front will go according to plan.”
“All of us are working as one team, for we understand well that only quality work from every link will secure high effectiveness of the whole process,” reads a quote the announcement attributes to Potiy.
Transparency of drone acquisition
One key area of concern on the part of critics is the transparency of the Communications Service’s drone acquisitions, specifically their published contracts.
“As of now (the new Communications Service) can find ways to close information about those contracts. They publish reports of how much they are spending on these drones,” explains Radchenko. “They can just make the decision to hide this kind of information, and then say that they procured drones for $1 million — but not the price per drone.”
“Fedorov’s team had the brains to make these purchases public, but, legally, they have the right to make these purchases private,” says Nikolov, whose website, Nashi Hroshi (Our Money) — specializes in investigations based on Ukraine’s public contracts.
The ultimate fear is that “they could take the same budget to buy half as many drones,” Nikolov explains, noting the funds could easily be siphoned off.
Limited transparency has been at the heart of many of the scandals surrounding Ukrainian military acquisitions, many of which, unlike those civil drone purchases, aren’t publicly reported at all.
Concern over Zamlynsky’s appointment reflects his presence in the Ukrainian Defense Ministry during a rations acquisitions scandal that helped end Oleksiy Reznikov’s tenure as defense minister in 2023.
When contacted, the Digital Transformation Ministry over which Fedorov presides directed the Kyiv Independent to the Communications Service. When reached, a press representative for the President’s Office, which Yermak leads, directed the Kyiv Independent to the Defense Ministry and did not respond to further questions. A top advisor to Yermak did not return a request for comment.
Neither the Communications Service nor the Defense Ministry returned requests for comment.
A representative for the Strategic Industries Ministry directed the Kyiv Independent to a deputy minister who could not be reached.
Natalia Kushnerska, the head of Brave1, which coordinates defense tech between the Defense Ministry and the Digital Transformation Ministry, would not comment on the situation when reached. Mykhailo Fedorov himself could not be reached.
