The Institute of Electronic Declaration in Ukraine has been in existence for almost 10 years. During this time, declarants have developed both good habits and traditions, as well as some not so good ones. For example, when submitting their first electronic declaration to the Register of Declarations, some declarants indicate that they and/or their family members have a significant amount of cash. They then explain this as the source of funds for the acquisition of expensive assets.
- In declarations submitted for 2022, cash in the amount of UAH 40.1 billion, USD 2.46 billion, and EUR 398 million was declared;
- in declarations for 2023, UAH 46.9 billion, USD 2.97 billion and EUR 457 million;
- in declarations for 2024, UAH 51 billion, USD 3.12 billion and EUR 529 million.
Disclaimer: along with the facts of artificial increase in the amount of cash revealed during the verification of declarations, there are cases of declaring cash amounts with errors, such as incorrect currency selection (dollar instead of hryvnia), extra zeros or incorrect transfer of information about funds from the previous declaration. At the same time, the amount of funds may be duplicated if the official and members of his family are declarants.
"A couple of years ago, detecting lies in declarations regarding the amount of cash, let alone bringing declarants to justice for this, seemed unrealistic. However, the National Agency on Corruption Prevention (NACP) is constantly working to improve financial control procedures and expand the scope of information analysed during their implementation. Thanks to this, it is now possible not only to detect cases of false declarations of cash, but also to obtain the first court decisions on holding declarants accountable for artificially inflating the amount of cash in their declarations," said Yulia Kulikova, head of the NACP's Comprehensive Audit Department.
Thanks to the new risk-based approach to selecting declarations for full verification, declarations indicating cash amounts significantly exceeding the income received by the declarant and their relatives from legal sources are very often included in the verification process. The NACP works closely with law enforcement agencies, in particular the State Bureau of Investigations and the National Police of Ukraine, to identify and investigate cases of false declarations, illegal enrichment and the acquisition of unjustified assets by declarants. Effective interaction between agencies, as well as the NACP's continuous improvement of declaration verification procedures, prevent dishonest declarants from evading responsibility for violating financial control requirements.
As a result of full audits of declarations, NACP found cases of deliberate overstatement of cash amounts. For more details, see the examples below.
Court decisions
By a court ruling, a former deputy of the Turbivka village council in Vinnytsia region was found guilty of declaring inaccurate information (Article 366-2 of the Criminal Code of Ukraine (CC of Ukraine) and fined him 51,000 hryvnias, with a one-year ban on holding office or engaging in activities related to the performance of state or local government functions. In his 2021 declaration, he provided false information about the possession of funds, including cash, by his family members (mother and wife) in the amount of over 5.5 million hryvnias.
Another decision of the Odessa District Court found the head of the Podilsky sector, a senior state inspector for energy supervision at the State Energy Supervision Department in the Odessa region, guilty of committing an offence under Part 4 of Article 172-6 of the Code of Ukraine on Administrative Offences. In his corrected declaration for 2022, he provided false information about the possession of cash in excess of UAH 1.1 million by him and his wife. During the audit, it was established that the official and his wife could not have saved the declared amount of cash by the end of the year, as the funds had been spent on the purchase of cryptocurrency.
Suspicion reported
A report of suspicion was filed for knowingly providing false information in the 2023 declaration about cash in the amount of 100,000 euros and 200,000 dollars (equivalent to over UAH 11.8 million) was received by the State Bureau of Investigations (DBR) from an official who held the position of head of one of the departments of the Main Directorate of the State Migration Service of Ukraine in the Odesa region.
Investigations launched
The materials of the full audits also served as the basis for other criminal proceedings for lying in cash declarations.
The SBI is conducting pre-trial investigations in criminal proceedings against the former deputy head of the Zakarpattia Customs Department, who in his 2022 declaration indicated that his wife had cash in the amount of $3.1 million. He also declared his own cash holdings of $216,600 and €140,000 (equivalent to a total of UAH 13.4 million). He did not confirm the legality of the sources of these funds during a full audit of the declaration, and in the declaration for 2023, he additionally increased his wife's cash holdings by another UAH 10.5 million, also without confirming the legality of their origin.
Based on the results of full audits conducted by the NACP, the National Anti-Corruption Bureau of Ukraine (NABU) has initiated criminal proceedings against:
the former head of the Main Directorate of the Pension Fund of Ukraine in the Khmelnytskyi region, who indicated cash in excess of UAH 23.3 million in his 2022 declaration. The actions were classified under Part 2 of Article 366-2 (false declaration) and Article 368-5 (illegal enrichment) of the Criminal Code of Ukraine;
a deputy of the Zaporizhzhia Regional Council, who in his 2022 declaration provided information that did not correspond to reality about his wife's possession of over 1.27 million euros in cash (equivalent to UAH 49.6 million);
- a deputy of the Zakarpattia Regional Council, who in his 2023 declaration provided false information about having 387,000 euros, 10,000 US dollars and UAH 760,000 (equivalent to a total of UAH 17.4 million) in cash.
The National Police of Ukraine is also conducting criminal investigations into a number of other declarants.
These include:
a deputy of the Khmilnytsky City Council in Vinnytsia region, whose 2023 declaration contained false information about cash holdings of over UAH 13.7 million;
a deputy of the Pidhorodne City Council in the Dniprovskyi district of the Dnipropetrovsk region, who in his corrected declaration for 2022 indicated UAH 2 million and USD 40,000 in cash (equivalent to over UAH 3.46 million), and in his declaration for 2023, he indicated over UAH 1.4 million and the same USD 40,000 (equivalent to over UAH 2.9 million), which were not confirmed during the verification;
a deputy of the Shepetivka City Council of the Khmelnytskyi region, who in his corrected declaration for 2022 overstated the amount of cash by over UAH 2.5 million;
- chief specialist of the State Energy Inspection Department in the Odesa region, who did not confirm the accuracy of the cash amount of over UAH 2.7 million in his 2022 declaration;
- director of the municipal enterprise ‘Spartak Stadium’, who failed to confirm the accuracy of information declared in 2022 regarding cash in excess of UAH 9.8 million.
Among the most common explanations given by declarants regarding the sources of cash without providing any supporting documents were:
- receipt of gifts by a family member from persons with whom they had previous personal relationships, often foreigners, without specifying their surnames and first names;
- gifts from parents who grew vegetables, fruits, etc. and saved money, although they were not entrepreneurs;
- gifts from relatives who worked abroad, without confirmation of the amount of income they received and the fact of transfer of funds to declarants or members of their families.
The NACP urges officials to declare cash responsibly and honestly.
We would like to remind you that one of the reforms provided for in the Roadmap on the Rule of Law is the introduction of legislative changes to minimise risks when declaring cash outside the banking system.
Disclaimer: In accordance with Article 62 of the Constitution of Ukraine, a person is presumed innocent of a crime and cannot be subjected to criminal punishment until their guilt has been proven in accordance with the law and established by a court verdict.
More results of full audits and relevant reports can be found in the section ‘Results of NACP activities’.
