The government of former Ukrainian Prime Minister Yulia Tymoshenko misappropriated nearly half a billion dollars, according to an audit by three U.S. investigative companies firms released Thursday.
The three firms were hired by the government of President Viktor Yanukovych. Tymoshenko was the main driving force behind the 2004 Orange Revolution street protests that threw out Yanukovych’s fraud-tainted election victory. But Yanukovych won February’s presidential vote amid public discontent over economic problems and vicious infighting in the Orange camp.
The auditors charged that Tymoshenko’s government committed fraud and resorted to "classic international money laundering mechanisms" while buying sugar, vaccines, importing expensive foreign cars and even selling carbon credits to other countries.
A top Tymoshenko aide dismissed the audit by Trout Cacheris PLLC, Akin Gump Strauss Hauer&Feld LLP and Kroll Inc. as politically driven and incompetent.
"We denounce these findings," Hryhoriy Nemyria told The Associated Press. "They are obviously politically motivated."
The audit, which covered the period from 2008 to the beginning of this year, claimed that Tymoshenko’s Cabinet spent $140 million (€101 million) on German minivans for alleged medical use by the Health Ministry which were later used as Tymoshenko’s mobile campaign advertisements.
It also said that the former Ukrainian government misappropriated some $280 million (€200 million) that were received for the sale of carbon credits as part of the Kyoto protocol and never used the money on environmental projects, as required. That money was transferred to the Pension Fund which was strapped for cash amid a severe recession, the audit said.
In addition, the three firms claimed that Tymoshenko’s government misspent $24 million (€17 million) on sugar which was never delivered to Ukraine, and misappropriated $44 million (€32 million) while importing vaccines and medical equipment.
"The investigation revealed evidence of misapplication of state funds and apparent fraud involving the highest levels of the previous administration, specific ministries, and private corporations," the auditors said in a statement. "We have gathered powerful circumstantial evidence of conduct that is not typical of honest officials and businesspeople."
A senior Ukrainian government official speaking on condition of anonymity said the audit cost the state budget $2 million (€1.4 million). The official, who was not authorized to discuss the issue with the media, said the current government intends to get the money which was allegedly misappropriated back via lawsuits.
