Pecherskyi court’s travesty of justice returns: how Kudrytskyi was arrested over non-existent losses
Former head of Ukrenergo National Power Company, Volodymyr Kudrytskyi, has been taken into custody for two months with bail set at 13 million UAH, accused of "abuse of office and unlawful appropriation of state company funds." The Pecherskyi Court’s decision followed several searches of Kudrytskyi’s premises by the State Bureau of Investigation (SBI) and an Ekonomichna Pravda article suggesting that the criminal prosecution attempts against the former Ukrenergo chief are politically motivated.
Kudrytskyi has been at odds with the current political leadership. For almost his entire tenure at Ukrenergo, there were attempts to remove him by Energy Minister Herman Halushchenko and former Deputy Head of the President’s Office Rostyslav Shurma.
The point is that Ukrenergo has the clearest view of the schemes operating on the electricity market, and those in power hardly want a witness like that.
In addition, Kudrytskyi refused to accept the management team being foisted on him. He has consistently favored the development of decentralized generation rather than Minister Halushchenko’s preferred nuclear power.
Back in 2023, Ukrenergo under Kudrytskyi became the target of numerous State Bureau of Investigation (SBI) probes and audits by the State Audit Service of Ukraine (SASU), the most memorable being the so-called "improper tile-cutting" case.
Kudrytskyi was also blamed for an expensive procurement of transformers at $10,600 per MVA from a company called Soiuz (which later faced press reports about its activities in Russia), and Ukrenergo was accused of dragging its feet on launching electricity exports as part of Ukraine’s synchronisation with ENTSO-E.
In fact, this synchronisation was only scheduled for 2023, and by a stroke of luck, during testing, Ukraine ended up connected to Europe rather than fully dependent on Russia. That is the principal, indisputable achievement of Kudrytskyi’s team. The company’s reputation also improved markedly on both the international and Ukrainian markets. For example, it was recognised by Prozorro as a top procurer.
Despite this, in September 2024, Kudrytskyi was dismissed for allegedly failing to adequately protect Ukraine’s power system from Russian missile and drone strikes. In reality, Ukrenergo performed better on this front than the Ministry of Infrastructure led by Oleksandr Kubrakov.
In fact, Kudrytskyi’s dismissal turned into a complete fiasco for the authorities. Neither journalists nor international partners bought the claim that the former Ukrenergo chief was to blame. What is more, it pushed Ukrenergo into technical default and seriously damaged relations with creditors who had trusted Kudrytskyi personally.
In addition, international partners instead demanded the dismissal from the President’s Office of Rostyslav Shurma, who was accused of schemes involving solar generation.
In August 2023, Bihus.Info published a report stating that solar plants co-owned by Shurma’s brother and associates continued receiving payments under the "green tariff" until the summer of 2023, even though they were located in occupied territory and likely were not connected to Ukraine’s unified power grid.
Despite the fact that in an interview with Radio Svoboda, Kudrytskyi said that he was not sure payments of the "green tariff" to Shurma’s plants should be classified as theft of public funds because the legislation provided no clear guidance for such a situation, Bankova decided that it was the Ukrenergo CEO who was behind the leak of this information.
After his dismissal, Kudrytskyi was all but forgotten for a year and concentrated on his own business before returning to the public eye and sharing noteworthy information. For example, he spoke about a project to build over 400 MW of additional power generation capacity in the Chernihiv region and Kryvyi Rih that was derailed by Herman Halushchenko’s political games during his tenure as energy minister.
A week ago, investigators searched Kudrytskyi, seized his phone, and later summoned him for questioning in a case concerning logging, at a time when he no longer headed Ukrenergo.
This week, he received a notice of suspicion from the SBI and was detained on October 28 in Truskavets.
According to the SBI, Kudrytskyi was involved in a scheme with controversial businessman Ihor Hrynkevych (who is under investigation over a bribe to the SBI and the non-delivery of goods to the Ministry of Defense), with a total value exceeding UAH 68 million. The state-owned enterprise then transferred more than UAH 13.7 million in advance payments to the contractor, which the perpetrators allegedly misappropriated with no intention of performing their obligations.
"Following the procurement, the parties concluded two contracts totaling over UAH 68 million. The state-owned enterprise subsequently transferred more than UAH 13.7 million in advance payments to the contractor, which the perpetrators misappropriated with no intention of fulfilling their obligations," RBC-Ukraine summarised the SBI’s suspicion.
A hearing to determine a measure of restraint for Kudrytskyi was scheduled for 2:00 p.m. at the Pecherskyi Court.
Here is what the prosecutor stated in court. According to him, in August 2018, Volodymyr Kudrytskyi and other individuals who were aware of the upcoming open bidding formed an intent "to misappropriate another’s property by deception, in especially large amounts, under the following circumstances."
The case concerned a tender for the reconstruction of perimeter fencing at substations of the Southern Power System, which was won by Vizin Rich LLC, a company linked to Ihor Hrynkevych.
To execute the contract, the company had to provide bank guarantees worth UAH 8 million (a standard requirement in many tenders). In this instance, Hrynkevych’s company provided guarantees issued by the Joint-Stock Commercial Bank (JSCB) "Concord".
Thereafter, according to the prosecutor, Hrynkevych arranged for the written bank guarantees from JSCB "Concord" to be submitted to the state enterprise Ukrenergo, "knowing full well that the company under his control would not fulfill the above contracts, and that the bank guarantees would later be called upon and the funds recovered in favor of Ukrenergo."
"Subsequently, in court proceedings, specifically, by a ruling of the Dnipropetrovsk Commercial Court dated 22 September 2020, Ukrenergo’s claims were upheld, and UAH 4.872 million in principal, as well as UAH 8.868 million, were recovered from JSCB ‘Concord’ in favor of Ukrenergo," the prosecutor told the court.
At the same time, he cited the testimony of a witness, a bank employee, who stated that Kudrytskyi knew full well that Hrynkevych’s company would not perform the contract.
However, the prosecutor did not explain what exactly Kudrytskyi’s alleged offense was, what benefit he derived from the arrangement, or how he interacted with Hrynkevych (the company is registered to another person).
Nevertheless, the prosecutor sought Kudrytskyi’s arrest, arguing that he "constantly changes mobile devices," employs "covert measures," and might abscond abroad because he has "three minor children."
Kudrytskyi’s lawyer denied all of the allegations, stating that the case file contains no evidence of his guilt or intent. He added that Kudrytskyi changes phones only because law enforcement periodically seizes them, and that the supposed "conspiracy" amounted to his car being parked in Truskavets in a hotel car park.
Kudrytskyi himself denied any wrongdoing.
Five members of parliament were present; three said they wished to stand surety for Kudrytskyi. The judge asked whether they knew what amount they would have to forfeit if the former Ukrenergo head were to abscond. Curiously, she did not ask how the prosecution calculated the damages, or how the SBI and the Prosecutor General’s Office defined losses.
These questions could already have been raised on the basis of open data from the Unified State Register of Court Decisions, which sets out in detail the disputes between Ukrenergo and Hrynkevych’s company, as well as with the bank.
Thus, according to one ruling of the Zhytomyr Commercial Court, after 11 October 2018 a contract was concluded between Private JSC "National Power Company Ukrenergo" (customer/claimant) and LLC "Vizin Rich" (contractor/defendant), under which the contractor undertook to reconstruct the perimeter fencing of substations in the Southern Power System at the customer’s request.
The advance payment under the contract was capped at 20% of the contract price.
In performance of the contract, Ukrenergo transferred an advance totaling UAH 4,862,810.40, as evidenced by payment order No. 165 dated 12 November 2018 for UAH 4,756,558.56 and payment order No. 166 dated 12 November 2018 for UAH 106,251.84.
Hrynkevych’s firm failed to produce even the design documentation on time. Despite a supplementary agreement, as of 20 December 2019, the design and surveying work, as well as the construction work, had not been performed.
The Zhytomyr Commercial Court’s ruling goes on to state the following.
"The contracting authority (i.e., Ukrenergo - ed.) raised numerous comments on the design documentation prepared by the contractor by way of letters, which it addressed in the ordinary course of work. By a letter dated 1 April 2019, NPC Ukrenergo provided more than twenty comments.
A further letter dated 15 May 2019 set out repeated comments.
Ukrenergo received a letter from the defendant dated 26 December 2018 proposing amendments to the design brief. The response to that letter was not ignored, contrary to what the defendant claims in its statement of defence.
Thus, by a letter dated 1 March 2019, NPC Ukrenergo provided Approved Amendments No. 1 to the design brief, on the basis of which, on 3 April 2019, the parties executed Supplementary Agreement No. 1 to the contract, extending the deadline for the design work until 30 April 2019.
Despite the extension, the defendant failed to perform the design work on time, which in turn resulted in a breach of the contractual deadlines.
The claimant further notes that, as stated in the text of the expert assessment dated 20 November 2019, it does not constitute grounds for approval of the design documentation or for obtaining a construction permit.
On 15 March 2021, the claimant submitted to the court an application to increase the claims, seeking recovery from the defendant as follows:
- funds in the amount of the unreturned advance totaling UAH 4,862,810.40;
- interest at 14% per annum, calculated for each day the advance was used, totaling UAH 1,583,544.23;
- the debt amount adjusted by the applicable inflation index, amounting to UAH 309,140.03;
- a penalty for failure to perform the design work of UAH 100,407.99;
- a penalty for failure to perform the construction and installation works of UAH 1,961,382.03;
- a contractual fine for failure to perform the construction and installation works of UAH 1,163,731.87.
The above application to increase the claims was admitted by the court."
In 2021, the courts ordered the recovery of UAH 4.8 million from the company. This is the advance that was transferred to the company, as confirmed by the payment orders referenced above.
Moreover, even by the prosecutor’s own account, Ukrenergo recovered an additional UAH 8 million under the bank guarantee.
In that case, it is not clear what losses for the company one can speak of in 2025. Given that by 2022, it had prevailed in all court proceedings through all three instances.
By comparison, the Ministry of Defense only initiated litigation against Hrynkevych after a public scandal. What is more, his company continued as a supplier because no complaints had been lodged by military units.
For state-owned enterprises, it is virtually impossible to prevent dubious firms from participating in tenders. The bank, however, had every opportunity to vet the company and its reputation. Frankly, it’s on the bank that it failed to do so.
Yet after reading the publicly available rulings describing the dealings between Vizin Rich and Ukrenergo, it is entirely unclear what law enforcement was thinking.
In the absence of any evidence of Kudrytskyi’s guilt presented in court, this looks like a trumped-up case.
And a very clumsy one at that.
Tetiana Nikolaienko, Censor.NET
