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Investigative Stories from Ukraine: Activists uncover reconstruction embezzlement attempt in Dnipro

by Anna Myroniuk May 23, 2023 9:48 PM 8 min read
A view of the residential building in Dnipro after it was hit by a Russian missile, killing at least 46 people and injuring 80, on January 14, 2022. (Credit: Dnipro City Council)
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Top investigative stories

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Anti-corruption activists uncover reconstruction embezzlement attempt in Dnipro

Dnipro regional authorities tried to attract Hr 80 million ($2.1 million) in European Investment Bank donations to renovate an administrative services center that had already been renovated before the 2022 invasion, according to watchdog Public Control.

The reconstruction project began in 2020. The following year, a company called Tellor-Group – reportedly linked to brothers Volodymyr and Leonid Dubinsky – won the tender. The Dubinsky brothers are influential local businessmen. They are wanted in the U.S. for their alleged involvement in a mortgage fraud scheme.

By January 2022, 99% of the Hr 55.5 million initially allocated for the project from the local budget had already been spent, Public Control reported citing Prozorro, Ukraine’s public procurement system. In February last year, local authorities reported that the reconstruction of the building was nearly done.

Last month, local authorities initiated a tender for another Hr 80 million ($2.1 million) for interior works for the same building. The estimated renovation price per square meter was listed at $1,100. According to the Public Control, the costs of construction materials were inflated two to three times in that project.

Tellor-Group won this tender, too. Eventually, the European Investment Bank rejected the project.

Meanwhile, Tellor-Group won another tender. This time it was dedicated to renovating a residential building in Dnipro that was hit by a Russian missile. The company was told to replace broken windows and balcony doors for Hr 39 million in taxpayer money. According to Public Control, the market rate for the project is Hr 13 million.

Watch the full video in Ukrainian via the link.

Bihus.Info: Son of fugitive ex-PM Azarov has coal mine in Russia, enjoys sanction-free life in EU

Alexei Azarov, son of former Ukrainian prime minister of the Viktor Yanukovych era Mykola Azarov (charged in Ukraine for treason), acquired shares in a coal mine in Russia in 2021 through a trustee, Bihus.Info investigative journalism outlet uncovered.

This coal mine is called Rostovskaya and is based in the town of Gukovo in Rostov Oblast. Between 2021 and 2022, the mine sold coal to companies from Slovakia, Poland, Hungary, and Moldova, Bihus.Info reported citing export-import databases.

Up until early 2022, the largest buyer of Rostovskaya coal was Slovak-registered E.Connect S.R.O. of Vasyl Danyliv, a Ukrainian businessman. Danyliv confirmed to Bihus.Info that he co-owns “Rostovskaya” together with Alexei Azarov – both through intermediaries.

Danyliv provided Bihus.Info with documents that he claims prove that his EU companies had not bought any coal from the Rostovskaya coal mine since the Russian all-out war broke out. Immediately after, he said he had cut ties with Azarov and handed the mine over to management. However, he hasn’t sold his shares.

As for Alexei Azarov, he has had Russian citizenship since 2017 and has been actively investing in Russian companies. However, the money he makes in Russia he spends abroad. Often in Vienna, Austria. There, the Azarov family has real estate, including a luxurious villa of over 1,000 square meters, worth a few million euros. Alexei Azarov bought it in 2010 when his father was Ukraine’s prime minister, according to Bihus.Info.

This villa was briefly under arrest in connection to a criminal investigation against Azarov, Bihus.Info reported. However, the case stalled, and the sanctions against both Alexei and Mykola Azarov were later lifted.

Now the family of Mykola Azarov, who lives in Russia and backs Russia’s war against Ukraine on Russian television, is free to travel and do business in the EU. After the sanctions pressure was eased, the Azarov family sold some of their Austria-based real estate.

Watch the full video in Ukrainian via the link.

In other news

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The Kyiv Independent becomes member center of OCCRP

The Kyiv Independent joined the Organized Crime and Corruption Reporting Project (OCCRP), a global network of investigative newsrooms, as a member center.

OCCRP is an independent award-winning non-profit organization launched in 2006 by journalists Drew Sullivan and Paul Radu. The network unites dozens of media outlets from across continents.

“We are honored to become a member center of OCCRP, an organization we deeply respect and appreciate,” said Olga Rudenko, chief editor of the Kyiv Independent. “When we launched the Kyiv Independent, we saw investigative journalism as an essential part of it, and joining OCCRP is a logical and much-anticipated step for us. We believe that investigative reporting has an especially important role now, when Ukraine is fighting for its survival, and will become absolutely essential when covering the reconstruction of Ukraine.”

“I am excited about an opportunity to do joint projects with the OCCRP, a team of talented and skillful people I've known for a while. I am positive that there are many great stories ahead of us,” said Anna Myroniuk, head of investigations at the Kyiv Independent. “The Kyiv Independent shares OCCRP's belief that collaborative cross-border journalism amplifies the impact of reporting.”

The Kyiv Independent became the second member center of OCCRP in Ukraine, the first being Slidstvo.Info.

The Kyiv Independent has two departments dedicated to investigative journalism. One is the general investigative desk, launched in August 2022. Another one is specifically focused on Russian war crimes and was launched in March.

Since August last year, the Kyiv Independent has published seven investigations. Among them is the story exposing the Russian disinformation network in the United States, the story revealing that European arms brokers drove prices up amid the war in Ukraine, and an expose of Russian plans to exert influence on neighboring countries like Belarus and Moldova.

The Kyiv Independent’s two-part series investigating leadership misconduct in the International Legion of Ukraine won the prestigious #AllForJan Award 2023, was shortlisted for the European Press Prize 2023, and Ukraine’s National Investigative Journalism Award 2022.

In December, the Kyiv Independent launched a weekly newsletter, Investigative Stories From Ukraine.

To support our investigative journalism, become a patron of the Kyiv Independent.

Note from the editor: The Kyiv Independent is hiring! Apply here to join our investigative desk.

Meanwhile, in Russia

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Media: Russia imports electronics through Kazakhstan, evading sanctions

Despite Western sanctions, the Russian military is importing sensitive electronics through Kazakhstan, an investigation by the OCCRP, German Der Spiegel, and Russian outlet iStories found.

Citing Kazakh trade data from 2022, journalists reported that Russia used Kazakhstan as an intermediary to import drones and advanced microchips used in missiles and demining robots, which Russia wasn’t supposed to be able to get.

According to the trade data, Kazakhstan imported close to $5 million worth of drones, almost completely from China, and exported $1.23 million in drones to Russia. Before Russia's full-scale invasion of Ukraine, Kazakhstan's imports of drones were so insignificant that they did not even appear in official import-export data, the investigation showed.

The import of microchips reportedly more than doubled to over $75 million in 2022. Meanwhile, the export of microchips from Kazakhstan to Russia was 70 times higher in 2022 than the year before, increasing from a meager $245,000 to $18 million, the story found.

While Kazakhstan's foreign minister has said that his country is doing what it can to avoid Russia’s sanctions circumvention, he also said it is "very difficult," since Russia and Kazakhstan are part of the Eurasian Economic Union, meaning that trade between the two is not subject to customs checks.

Read the full story in English via the link.

Financial Times: Wagner mercenaries buy equipment despite Western sanctions

The Russian private army Wagner Group keeps using intermediaries to procure equipment in China to fight in Ukraine and Africa, Financial Times reported.

This shows the inability of Western sanctions to successfully curtail Wagner’s access to military tech. Company chief Yevgeniy Prigozhin is able to equip and supply his contractors deployed in Ukraine, as well as in the Central African Republic and other African countries through China.

Prigozhin uses the Russia-based company called Broker Expert as a front. The company is not under Western sanctions.

At the end of 2022, Broker Expert bought 20,000 helmets for Wagner from a minor Chinese company, Hangzhou Shinerain Import And Export Co.

The Chinese company denied any knowledge of Broker Expert’s connection to Wagner, treating it as a regular sale. As a China-based entity, the company has no obligation to follow Western sanctions. It is also unclear whether Beijing is aware of these activities.

Washington has previously voiced concern about China’s government aiding Russia’s war effort, and Chinese companies providing non-lethal aid.

The United States labeled Wagner as an “international criminal organization” and applied sanctions on entities connected to the mercenary group, seeking to disrupt its network.

The case of Broker Expert illustrates how Prigozhin continues to use loopholes in Western sanctions, using sanction-free fronts and third countries. Apart from China, Wagner also bought weapons from North Korea and sought to buy arms from Turkey, a NATO member.

Read the full story in English via the link.

Business Insider publishes plans for Putin’s secret Black Sea bunker

Vladimir Putin’s palace, situated near the Russian town of Gelendzhik overlooking the Black Sea, has underground infrastructure seemingly designed to save the Russian president from nuclear or chemical threats, Business Insider reported citing the construction plans.

A now-defunct Russian contractor, Metro Style, failed to keep the project secret and published the diagrams on the Internet back in 2010. They were viewable online as of 2016, having only attracted the attention of "diggers," urban explorers who visit forbidden sites, who saved the visuals and brought them to Business Insider.

The architectural plans show two tunnels running beneath the palace. They are connected by an elevator that descends roughly 50 meters below the surface.

The tunnels, encased in thick concrete, are supplied with enough fresh water, ventilation, and cables to support residents for days or weeks at a time, according to the report. The bunker has the electricity and fiber optic cable sufficient to operate as a command post.

Putin’s palace was first discovered in 2021 by the Anti-Corruption Foundation of Alexei Navalny, the Russian opposition leader now in jail.

Its luxuries include a private church, wine cellar, casino, hookah lounge complete with a stripper pole, and an ice rink for hockey games.

The imperial mansion is protected from the public eye by 17,000 acres of woodland and a special no-fly zone.

Read the full story in English via the link.

Media: Mistress of top Kremlin propagandist gave birth in US

Russia’s top anti-West propagandist Vladimir Solovyov's mistress owns a villa next to members of the Russian military elite in the Black Sea resort of Sochi and gave birth to her children in the U.S., the Anti-Corruption Foundation of Alexei Navalny reported on May 22.

According to the investigation, Svetlana Abrosimova, a former basketball player, is Solovyov's mistress and gave birth to their two daughters in the U.S. in 2017.

Navalny's team discovered that Abrosimova had a U.S. passport. Since she gave birth to her children in the U.S., they are technically also U.S. citizens.

Solovyov has repeatedly called on Russia to launch attacks against the West during his on-air tirades due to Western countries' ongoing military support for Ukraine.

"(The Russian elite's) whole struggle with the West, which is used as a pretext for war, is a grandiose deception. There is no person in Russia more attached to the West than Vladimir Solovyov," Navalny's team wrote.

Abrosimova also allegedly owns a 650-square-meter villa in Sochi that is worth 500 million rubles ($6 million). However, this information has been removed from the Russian State Register, according to the investigation.

Neighboring properties belong to top Russian military officials, leading Navalny's team to wonder how an athlete was able to acquire such a prime real estate location.

Watch the full story in Russian with English subtitles via the link.

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