Scandals in Medical and Social Expert Commissions: Any Prospects for Punishment?

The scandal in the medical expert sanitary commissions (MSEC) continues to gather steam. Already several episodes, which involve dozens of potential defendants in several regions of Ukraine, are being investigated by three law enforcement agencies at once. It is likely that new facts and revelations will emerge as a result of the scandal.

Obviously, in addition to the need to reform the system of these commissions, this large-scale scandal has highlighted several urgent problems in the anti-corruption sphere.

Which body can investigate such cases and how? What happens if the illegally obtained assets of the commission heads are found? What should the NACP have done to expose such potential abuses? Will all those guilty of real violations in the commissions be punished? Read on to find out.

What are Krupa, other heads of the commissions, and Khmelnytskyi prosecutors in for?

Despite all the “spin-offs” in the case involving heads of the medical and social expert commissions, let’s recall the main figures of the scandal.

It all started with the SBI searches at the premises of Tetiana Krupa, head of the Khmelnytskyi Regional Center of the MSEC, and her son Oleksandr, who is also the head of the Pension Fund of the Khmelnytskyi region. After law enforcement officers found USD 6.5 million of undeclared cash at Krupa’s residence and evidence that she had issued disability certificates, she was served with a suspicion notice of unlawful enrichment.

Subsequently, the case was transferred to the NABU from the SBI since Krupa is a member of the Khmelnytskyi Regional Council, and by law, the Bureau has jurisdiction over investigations into officials of this category. An interim measure has already been selected for Tetiana Krupa in the form of detention, this decision is now being appealed. Let’s talk about why this case is special.

The detention of Krupa is just the beginning of the story. Journalists then conducted their own investigation and found that fifty prosecutors of the Khmelnytskyi region, including the regional prosecutor Oleksii Oliinyk, have an issued disability certificate. Under this status, they received pensions for years.

Such a turn eventually led to a series of decisions by the authorities. In particular, the Prosecutor General’s Office initiated official investigations concerning all bodies of the prosecutor’s office. According to preliminary data from the PGO, similar cases with dozens of prosecutors with disability certificates in other oblasts were reported. This was also the reason for the resignation of the Prosecutor General. The Verkhovna Rada has already voted for his dismissal.

President Volodymyr Zelenskyy reacted to this scandal, announcing large-scale inspections of the entire structure and its elimination. This is where the public part of the scandal ended.

Let’s focus on the case of Krupa. Why is it so special, and how is it different from other MSEC episodes?

As we have already indicated, the case of Krupa is being investigated by the NABU. Later, it will be heard by the HACC because she is a member of the regional council. As for other MSEC representatives, their actions shall be investigated by the SBI. However, not without exception: the investigation into potential corruption schemes by Vira Bieliakova, head of the Mykolaiv regional MSEC, is conducted by the SSU. During the searches at Bieliakova’s premises, more than USD 450,000 dollars was found in cash, as well as a collection of jewelry, which she hid at different addresses. Her son has a Russian passport issued by the Russian consulate in Odesa before the full-scale invasion.

But the main question is: What liability will the defendants bear under the law if the court finds them guilty? The Law on Corruption Prevention establishes an exhaustive list of officials who can be punished for unlawful enrichment, and there are no heads of regional MSECs or any other members of these commissions among them.

This means that the commission heads can be punished only for false declaration. The maximum penalty for such an offense is a 2-year imprisonment without the opportunity to hold certain positions or engage in certain activities for 3 years. At the same time, illegal assets cannot be confiscated, no matter how significant they may be, since this article does not provide for an additional punishment in the form of confiscation.

On the other hand, the state still has the opportunity to bring MSEC heads to criminal liability for money laundering (Art. 209 of the Criminal Code of Ukraine) if a MSEC official, for example, purchased property for the received bribe or put these funds into bank accounts. This article has a more severe punishment—up to 6 years in prison, or up to 8 years if it concerns property worth more than UAH 9 million. Under this article, such illegal property can be confiscated. However, in Ukraine, this approached is rarely applied, although it could be a solution in the MSEC cases.

It is precisely because of the complexity of punishment provided for such violators that the parliament should include this category of people in the list of authorized persons to perform the functions of the state or local self-government. This will allow for prosecuting dishonest MSEC heads for unlawful enrichment and confiscate their assets either in criminal proceedings or within civil forfeiture.

As for the prosecutors from the Khmelnytskyi region, as well as other regions, only official investigations against them were reported. However, such investigations do not provide for prosecution for corruption, and following the results of official investigations, prosecutors can only issue reprimands or dismiss them. However, these results can also become the basis for other criminal investigations if the Prosecutor General’s Office transfers them to the SBI or the NABU.

Meanwhile, while the internal investigation is ongoing, all prosecutors whose disability is dubious may continue to exercise their powers if they are not suspended or dismissed before the end of the investigation.

However, if it turns out that prosecutors got a disability certificate illegally a through a corruption scheme, a criminal case may be initiated against them. In particular, under Art. 369—providing improper advantage, under Art. 358—forgery of documents, or Art. 190–fraud. However, there is currently no information that such cases have been initiated or that suspicion notices have been served.

Could the NACP have detected violations in the declarations of MSEC heads?

Heads of regional MSECs are obliged to submit declarations (despite recent statements by the Head of the NACP), and all of them are in the public domain, except that of Natalia Salnykova, head of the Kherson MSEC. We studied the financial condition of 23 heads of regional MSECs and found that not only Tetiana Krupa could be suspected of potential violations.

We are most concerned about the fact that 18 out of 23 MSEC heads receive a pension, or their husband or wife do. In 8 cases, both receive a pension.

Due to the peculiar way of entering data in the declarations, we cannot establish whether these pensions are retirement benefits for years of service, a disability pension, or it was assigned under some other reason. But such an analysis can and obviously should be carried out by the NACP. After all, the receipt of a pension by MSEC heads and their family members, if it was assigned specifically for a disability, may indicate a potential conflict of interest, which is precisely within the NACP mandate.

In addition, in more than half of the cases, a significant increase in assets of the heads of regional MSECs during their tenure can be traced. Of course, most of them are nowhere near the level of Tetiana Krupa and her husband, who, by the way, is also a civil servant, as he heads the Department of the State Audit Service of the Khmelnytskyi region. However, some cases attract attention. For example, the fact that Vasyl Tymoshchuk, head of the Volyn MSEC, declared 50 real estate objects. The level of Tymoshchuk’s income of UAH 492,000 for 2023 (including pension) and information about his previous earnings, which were almost half lower, raises serious doubts about the possibility of buying so many assets.

An alarming trend is the acquisition of a number of large land plots by MSEC heads and their husbands or wives, sometimes for ridiculous amounts of money. Thus, the wife of Mykhailo Kulayets, head of the Ivano-Frankivsk regional MSEC, acquired 4 land plots of more than 1000 sq. m. during his tenure. Kulayets himself in 2023 alone acquired 5 more plots of several thousand square meters. According to the declaration, 4 of them cost less than UAH 10,000.

This raises the question: did the NACP check the above-mentioned declarations of regional MSEC heads, and what conclusions did the Agency reach following the results of such checks?

Overall, the declarations of 6 MSEC heads successfully passed the automated full check by the NACP, which consisted in verifying if the data of the declaration corresponded to those from the registers. However, many questions remain about the success of automated checks. During a full manual check, the authorized person can ask the declarant for an explanation of the origin of the declared savings, while an automated check does not provide for such a possibility. Similarly, an automated full check will not be able to identify a likely conflict of interest when MSEC heads unreasonably provide disability conclusions about themselves or their family members. The NACP cannot check the amount of cash savings of declarants by mandate; only law enforcement agencies can do this during searches.

Interestingly, among all the declarations we studied, only one was manually checked by NACP authorized persons, and this was precisely the declaration of the Khmelnytskyi MSEC head. The results of the check revealed only signs of an administrative offense, not a criminal one.

The certificate on the results of the full check of Tetiana Krupa indicates that the NACP specialists found discrepancies only regarding the undeclared value of the property, checking them with the state register. But the authorized persons did not order an examination of whether the value of land plots or houses acquired by Krupa in 2022 in the Khmelnytskyi region corresponded to the market value, and the declaration indicated roughly UAH 2,000 or UAH 10,000. We have seen many similar cases with land plots purchased for peanuts. In other declarations of regional MSEC heads, we have seen many interesting things.

When resuming declaration, MPs laid down a new rule in the law on Prevention of Corruption on the presumption of reliability of state register data, with the only exception—the information from them is unreliable if it is established legally. Therefore, the NACP should not only be guided by data from state registers and title documents, but also check them in regard to the market value.

Now the declarations of Krupa and her husband are being re-checked. However, the overall picture with the checks of the MSEC head declarations gives reason to doubt the effectiveness of the current NACP financial control measures when checking declarations. We have already criticized the Agency’s new approach to automating full checks, and this analysis of ours confirms the previous position.

We cannot comment on the reasons why, in addition to the declaration of Tetiana Krupa, the declarations of other MSEC heads were not selected for a full manual check by the NACP. All because the rules of logical and arithmetic control, according to which the risk of declarations is determined, still have not been disclosed. We have long called on the NACP to make these rules public so that potential problems could be identified and the selection of declarations could be improved.

It is important to understand that it is a quality check of officials’ assets by the National Agency that may eventually become the basis for the opening of proceedings by law enforcement agencies regarding potential violations.

How do we change all that?

Unfortunately, personnel decisions within the MSEC scandal, as well as the liquidation of the very institution, do not solve the systemic problem—insufficient control over the operation of these commissions and the impossibility of bringing their representatives to justice. Currently, there are practically no mechanisms that would ensure proper detection, investigation, and punishment for this category of civil servants.

The system needs comprehensive fundamental changes that will become reliable safeguards against similar scandals in the future. In the future, similar neglected issues may emerge in other fields despite all attempts to control this process.

What should be done so that there are no more such large-scale scandals?

1. The NACP should review the existing approach to conducting full checks, in particular abandon their automation and focus on conducting these audits manually by authorized persons.
2. The parliament should synchronize the circle of persons who can be punished for unlawful enrichment or whose assets can be considered unjustified with the entities obliged to submit declarations in accordance with the Law on Prevention of Corruption.

However, such changes will not impact the story that has unfolded. After all, criminal law does not have a retroactive effect, and therefore it is necessary to develop a mechanism for bringing to criminal liability for the legalization of property.

Unless this is done, then at best, the NACP will select the declarations of MSEC heads for full checks; based on the results, it might establish the following signs:

• of false declaration, which we mentioned above or
• of a real conflict of interest if it is proved that MSEC heads received a pension based on their own expert opinions. Liability for such a violation is a fine of UAH 1,700 to UAH 13,600 with a deprivation of the right to hold certain positions or engage in certain activities for a period of 1 year (Articles 172-7 of the Code of Ukraine on Administrative Offenses).

In addition, based on the violations established above, MSEC heads may be brought to disciplinary liability, that is, in the best-case scenario, those who have not yet been dismissed will be dismissed. Can this be precisely the kind of punishment that Ukrainians expect for such crimes? Hardly.