April 17, 2020

Yermakgate scandal rocks Zelenskyy administration


KYIV – While struggling to address the unprecedented challenges posed by the coronavirus pandemic, the incessant war with Russia in the Donbas, and the looming economic crisis, Ukraine has been shaken by potentially the biggest political scandal since Volodymyr Zelenskyy was elected president almost exactly a year ago.

National Deputy Geo Leros, a member of Zelenskyy’s Servant of the People majority faction in Parliament and a former adviser to the president, on March 29 published video online implicating Denys Yermak, the bother of the head of the Presidential Office, Andriy Yermak, in corruption.

The many hours of videos, filmed secretly between August and September 2019, show Denys Yermak meeting with individuals seeking appointment to rewarding positions in the government or state-owned companies. Payment for his services is discussed, though as yet no evidence has been provided of money changing hands or of any of the candidates having secured the posts they were after.

Mr. Leros has refused to disclose the source of the secret recordings and what their motive was. He says that in acting as a whistleblower he is fulfilling his responsibility to expose corruption at the highest levels and to expose the president’s right-hand man for what he is. After all, Denys Yermak would not be in a position to propose lucrative posts for cash without being confident that his brother would back him up. Mr. Leros has handed over the recordings, along with a crime report, to the National Anti-Corruption Bureau, an independent agency investigating high-level corruption.

Neither Denys nor Andriy Yermak deny that the leaked video recordings do indeed show the former meeting with “business clients.” But Andriy Yermak insists he was not involved, that his brother was acting independently, and that in any case none of those with whom appointments were discussed actually landed jobs with or through the Zelenskyy administration.

On March 31, Andriy Yermak claimed that Mr. Leros had published the tapes on the eve of crucial voting in the Verkhovna Rada on two bills whose passage had become a precondition for Ukraine to receive a financial bailout from the International Monetary Fund. He said that Mr. Leros was being used by political opponents and that his real motive was revenge, because he had failed in lobbying for a friend to obtain a government post.

The presidential chief of staff announced that he has filed official allegations against the lawmaker to the Security Service of Ukraine (SBU) and the State Bureau for Investigations (SBI) – both of which are ultimately subordinated to the president.

For a political leader who came to power pledging to root out corruption and nepotism, President Zelenskyy remained conspicuously reticent on the matter. On April 2, Mr. Leros published further extracts from the leaked recordings indicating, among other things, that the discussions had involved even the posts of director of the National Nuclear Energy Generating Company of Ukraine (EnergoAtom), the state enterprise operating all four nuclear power stations in the country.

The fallout from the scandal necessitated an April 2 meeting for damage-control purposes with the leaders of the Servant of the People party. Mr. Zelenskyy managed to persuade them that he would not pressure the SBU and and the SBI, and that the results of their “impartial” investigations would clarify matters.

On the other hand, Andriy Yermak reportedly attempted to explain away the “erratic” behavior of his younger brother and convince Mr. Leros’s colleagues that the whistleblower’s motives were entirely devious.

Thirty-year-old Mr. Leros, a typical political newcomer from Mr. Zelenskyy’s harvest of new lawmakers, fell out with Andriy Yermak on an entirely different matter. A well-known up-and-coming figure on Kyiv’s arts scene, the young art and film director was best known for a project known as “City Art,” which brought world-known muralists to Kyiv to transform empty building walls into open-air art galleries.

While Petro Poroshenko was president, Mr. Leros served as an advisor to the minister of information policy. President Zelenskyy subsequently appointed him as an advisor.

The conflict surfaced in March after Mr. Leros adopted an openly critical position after Andriy Yermak, the chief Ukrainian representative during negotiations in Minsk with the Russians, appeared to yield to pressure to establish a consultative body that would include representatives of the fake Donetsk and Luhansk “people’s republics.” Mr. Leros was one of 55 deputies from the Servant of the People faction who signed a statement opposing such a move.

But the national deputy went further and gave an outspoken interview to the press. On March 13 the president fired him as his advisor and Mr. Leros believes that Andriy Yermak was behind this move.

Andriy Yermak himself has not mentioned this as a factor, but he has insinuated that Mr. Leros might be a weapon of his predecessor as head of the Presidential Office, Andriy Bohdan. The latter was replaced on February 11 by Mr. Zelenskyy after losing a behind the scenes internal power struggle. Since then Andriy Yermak has consolidated his position as the most powerful figure next to the president, responsible not only for foreign policy, but also, increasingly, domestic issues.

If Mr. Bohdan came across as strong-headed and bullish, his successor, Mr. Yermak, is seemingly more slick and guarded. Both are lawyers, with the former having worked for the notorious oligarch Ihor Kolomoisky, while the latter more recently has concentrated on the legal side of film production. He remains an imponderable and, apart from his business contacts in Moscow, it is not clear why Mr.  Zelenskyy gave him responsibility for foreign affairs.

On ousting Mr. Bohdan, Mr. Yermak pledged to do things differently and be more open in the way the Presidential Office is run. This has not happened. Moreover, he shocked many with what was seen as a tactless display of ostentation: on March 11 he acquired a new Mercedes valued at almost 3 million hrv, or over $100,000 (U.S.).

In their recriminations, Messrs. Leros and Yermak both have not hesitated to depict one another as dubious Ukrainian patriots. On March 29, Mr. Leros addressed the following words on his Facebook page to Mr. Yermak: “in our country, which is foreign for you, everyone is against you…” Mr. Yermak countered publicly by emphasizing that Mr. Leros is of ethnic Armenian origin.

Mr. Yermak has also suggested that Mr. Leros is being used by rogue oligarch Mr. Kolomoisky to weaken the Zelenskyy administration as it seeks a financial lifeline from the IMF. This accusation seems to ring hollow in light of the fact that a recent edition of Radio Liberty’s investigative journalism program “Skhemy” has disclosed apparent regular covert meetings between Andriy Yermak and Mr. Kolomoisky’s close associate, Timur Mindich.

“Skhemy” also alleged that the Presidential Office chief used his personal influence to get one of his friends appointed to a good position in the Kyiv administration. It also showed Mr. Yermak having a secret meeting in a carpark with an uknown man, something which, given his position, should not be hidden from the security services.

Nevertheless, observers covering the Yermak scandal have noted that, after the story about the recordings broke, the main media have fallen conspicuously silent about what is, after all, the most serious scandal involving leaked recordings since the notorious case of the Melnychenko tapes in 2000 during the Leonid Kuchma era.

This is all the more intriguing because two of the persons implicated in the discussions conducted by Denys Yermak as his partners, Dmytro Stanko and Serhiy Shumsky, appear to have turned “state’s evidence,” or are seeking to point the finger elsewhere. After questioning by the bodies conducting investigations on April 5, they have both filed formal allegations against both Yermak brothers involving “facts of fraud and corruption.”

So, as Ukraine remains preoccupied with the coronavirus threat and whether the IMF’s conditions for a bailout will be met, the Yermakgate scandal is a potential time-bomb, the fuse of which is burning and the consequences of which are hard to foresee.