Ukraine suffered a major rollback in its anti-corruption crusade when the Constitutional Court abolished criminal responsibility under an illegal enrichment law.
The judges ruled on Feb. 26 that the law violated the presumption of innocence and wrongly shifted the burden of proof to defendants instead of state prosecutors.
The article of the Criminal Code which the court found unconstitutional envisaged that public officials who cannot explain sources of having at least $35,000 worth of assets may face imprisonment from two to 10 years.
Parliament passed the law in February 2015 as one of the anti-corruption demands of the EuroMaidan Revolution that ousted Kremlin-backed President Viktor Yanukovych on Feb. 22, 2014.
The law, as part of a bigger anti-corruption drive, was also a requirement for continued International Monetary Fund lending and for the coveted visa-free travel regime with the nations of the European Union, which was introduced in 2017.
After the ruling, the National Anti-Corruption Bureau of Ukraine, or NABU, said it will have to close 65 criminal probes for illegal enrichment and four more cases that have already been filed in court.
They include the investigations against Infrastructure Minister Volodymyr Omelyan, Deputy Head of the Security Service of Ukraine Pavlo Demchyna, presidential candidate and leader of Radical Party Oleh Lyashko, and Prosecutor General Yuriy Lutsenko.
“Now we have legalization of ill-gotten assets,” Artem Sytnyk, head of NABU said on Feb. 28.
The court ruling took place five years after the EuroMaidan Revolution and one month before the presidential election on March 31. It outraged many in the country that is ranked as both one of the poorest and one of the most corrupt in Europe.
Lawmaker Sergii Leshchenko, who co-sponsored the anti-corruption legislation that included the illegal enrichment clause in 2015, blamed President Petro Poroshenko for using the Constitutional Court to get immunity from criminal prosecution for himself and his cronies in case he fails to be re-elected.
Along with two other lawmakers, Leshchenko left Poroshenko’s party faction in protest against the court ruling and called the judges who passed the decision “hookers on call.”
‘Tough decision’
In its motivation part, the decision of the Grand Chamber of the Constitutional Court says that apart from violation of the presumption of innocence, the Criminal Code article on illegal enrichment also violated the norms on “legal certainty” and the right of any person not to testify against him or herself.
The court’s chief judge, Stanislav Shevchuk, said that the abolished norm was in fact “obliging a defendant to collect evidence to prove his innocence,” which violates the Constitution.
“It is a tough decision but it is totally justified because the fight against corruption should be real, not a pretend one,” Shevchuk wrote on Facebook.
Although the decision was taken behind closed doors, insiders say that four judges out of 18 refused to support it.
They include Viktor Kolisnyk, Vasyl Lemak and Serhiy Holovaty, who were appointed to the court through the president’s appointment quota, and Ihor Slidenko, appointed within parliament’s quota. This information was reported by Liga.net, which cited its own sources, and by lawyer and ex-coordinator of judiciary watchdog Public Integrity Council Vitaliy Tytych.
Holovaty published a dissenting opinion, calling the court decision wrong. He said he believes the Criminal Code article “doesn’t give grounds to presume that a suspect or defendant bears the responsibility to prove his innocence or refute charges.”
In fact, concerns about this aspect of the now-void legislation aren’t new. Legal experts criticized this article back in 2015 when it was passed in parliament. The main legal department of the Verkhovna Rada filed a note that warned that it may violate the presumption of innocence.
Nevertheless, the European experts found in June 2018 that this Criminal Court article didn’t violate Ukraine’s constitution. And the concerns of the parliament’s legal department weren’t discussed in parliament during the voting.
Criminal lawyer Tytych, who represents relatives of slain EuroMaidan protesters, said the abolished article was “not ideal.” But he said its efficiency could have been checked by the Anti-Corruption Court that is expected to start its work this summer.
But now, even if parliament swiftly passes a new law on illegal enrichment as Poroshenko has offered, corrupt officials will manage to avoid responsibility.
“Now this criminal gang will manage to create formal grounds to legalize their assets,” Tytych said.
Strange replacement
On Feb. 28, Poroshenko filed a draft bill to replace the unlawful enrichment article that the Constitutional Court struck down.
But Poroshenko’s bill appeared to be no less controversial. It changes the definition of unlawful enrichment drastically.
In the previous version, an official would be punished if he “didn’t have proof of legitimate acquisition of significant assets.” In Poroshenko’s version, unlawful enrichment is defined as “illegal acquisition of significant assets” that doesn’t have signs of abuse of office or bribery.
Poroshenko on Feb. 28 said in a statement on his website: “This morning I signed and I am ordering now to submit the bill. The key issue remains the same — the inevitable punishment of illegal enrichment.”
Such a law would make it impossible to punish anyone for illicit enrichment, according to experts at the Anti-Corruption Action Center watchdog. They pointed out that to prosecute any official for unlawful enrichment under this law a prosecutor would have to prove the defendant didn’t take bribes.
The president’s bill has not been discussed in the parliament yet.
Head of the State Audit Service Lidiya Havrylova stands with her lawyers in Solomyansky court in Kyiv on Jan. 25, 2018. The court released Havrylova on her own recognizance pending trial. (UNIAN)
Repercussions
The cancelation of the unlawful enrichment clause in the Criminal Code ruins many of the ongoing corruption investigations. De facto, it is an amnesty: even when it is replaced with a new law, it will be impossible to prosecute anyone for illegally enriching themselves in the past several years.
Over nearly four years that the law on unlawful enrichment was enforced, the NABU opened 106 criminal investigations into alleged unlawful enrichment by lawmakers, judges, prosecutors, and current and former public officials. In four cases, anti-corruption prosecutors sent indictments to court.
No one has been convicted yet.
NABU said that it would have to close 65 ongoing investigations into a total sum of Hr 1.5 billion ($55.6 million). It also won’t be able to reopen those cases in the future.
NABU called the decision politically motivated and “a step back in the fight against corruption” in a statement from Feb. 27.
“We are talking about the vested interests of lawmakers who realize that they might not have a chance to stay in the parliament after the parliamentary election in the fall and want to protect themselves,” said Daria Kaleniuk, head of the Anti-Corruption Action Center.
One of those who benefit from the amnesty of illegal gains is a lawmaker with the People’s Front Party, Yevhen Deidei. He was among 59 lawmakers who filed an appeal to the Constitutional Court and he had been previously investigated by NABU. In 2016, detectives found that Deydey and his wife had bought a flat and two cars whose value exceeded the couple’s declared income by four times. NABU claimed that it had sufficient evidence to have Deidei stripped of his parliamentary immunity.
NABU also investigated Radical Party leader and presidential candidate Lyashko, who doesn’t own any business yet could afford a 550-square-meter house in Kozyn, an elite town outside of Kyiv; a 0.6-hectare land plot; and two cars for a total sum of Hr 20 million ($744,000).
Kaleniuk says that now NABU won’t investigate how another lawmaker and presidential candidate, Yulia Tymoshenko, could afford lobbyists in the United States, whom she denied hiring but whose services she used anyway.
Not only members of the parliament are now off the hook. So are judges, prosecutors, and government officials whom NABU has probed for living beyond their officially declared means and sources of income.
In 2017, NABU investigated the head of the Kyiv District Administrative Court, Pavlo Vovk, who lived in an elite mansion that officially belonged to his ex-wife and therefore wasn’t mentioned in his electronic declaration. He also maintained a collection of expensive watches and traveled abroad 33 times between 2012 and 2015 on charter flights — more than his judge salary could afford.
NABU prosecutors had a notice of suspicion of unlawful enrichment for deputy head of the State Security Service, Pavlo Demchyna, who in 2015–2016 spent Hr 6.4 million ($238,000) on cars, land plots, and an apartment while having an accumulated family income of Hr 2.8 million ($104,000).
Former military prosecutor Kostyantyn Kulyk was indicted for illegal enrichment after NABU detectives found in 2016 that his expenditures, mostly on restaurants, shopping, and petrol, exceeded his income by two times.
Head of the State Audit Service Lidiya Havrylova was accused of buying property for nearly Hr 10 million ($370,800) in 2015–2017. She couldn’t explain where this money came from, which significantly exceeded her official income. NABU determined it to be illegal enrichment and sent the materials to court.
The court was also going to consider the case of Infrastructure Minister Omelyan, who had failed to prove the legality of buying BMW X5 for Hr 1.4 million as well as having $90,000 and 25,000 euros in cash.
Another former government official, former head of the State Fiscal Service, Myroslav Prodan, was charged with embezzlement after anti-corruption detectives found he bought luxury cars and real estate in Kyiv and Turkey for Hr 89 million ($3.2 million).
Under the now-void law, unlawful enrichment was a felony that entailed up to 10 years in prison and forfeiture of property.
The Specialized Anti-Corruption Prosecutor’s Office said that since the Constitutional Court deemed the statute on illegal enrichment unconstitutional, the evidence collected in the course of those investigations becomes inadmissible too.
In the cases of Kulyk, Omelyan, and Havrylova, which are already in court, the anti-corruption prosecutors will have to review the evidence and decide whether it will be possible to prosecute them for lying on their electronic declarations, which falls under the misdemeanor category and doesn’t require a serious penalty.
General Prosecutor Lutsenko, said that the Constitutional Court decision wasn’t unexpected and the annulled statute was unenforceable anyway.
“Lawyers call such articles ‘dead,’ or simply impossible to enforce in practice. The norms of a poorly written law didn’t work,” he said.
However, back in 2015, when Lutsenko was a lawmaker, he co-authored the anti-corruption bill that included the very article he now criticizes.
Former Finance Minister Oleksandr Danylyuk told Bloomberg that the decision shows that “the court is dependent on and helps vested interests. It undermines efforts in fighting corruption.”
Kyiv Post deputy chief editor Olga Rudenko contributed to this story.
