For three weeks, protests have been taking place in Odesa over the misuse of budget funds. Residents are demanding that taxpayers’ money — a large share of which, incidentally, comes from service personnel registered in the city — be directed to the needs of the front.
The public outcry began after the announcement of a tender to restore the Kyivskyi District Court at a cost of more than 106 million hryvnias from the budget.
Despite the protests, the Odesa authorities signed a contract to repair the court. They are now trying to justify themselves by pointing out that, while they are funding expensive work far from the front, they are also sending a little money to the military.
Meanwhile, during the full-scale war, the owner of the company contracted to renovate Odesa’s Kyivskyi District Court signed a deal to buy property worth 905,000 euros. The money is going to a Czech company managed by someone originally from Russia.
The civic organisation Zelenyi Lyst investigated the details.
The story of the protests
It all began when the city’s Capital Construction Department, headed for many years by Borys Panov, announced a tender for the reconstruction of the Kyivskyi District Court for 106.2 million hryvnias.
The department announced the procurement on 8 August. This angered Odesa residents because, at the time, there was a critical shortage of drones, tourniquets and other equipment at the front. Expensive, non-essential repairs in the rear could wait until the full-scale war was over.
Well-known Odesa volunteer and founder of the Monsters Corporation Charitable Foundation Kateryna Nozhevnikova said that if the court renovation tender was not cancelled, she would stage a one-person picket outside City Hall. Hundreds of Odesa residents backed her idea and began regularly attending protests, demanding that the lion’s share of the money go to the Armed Forces of Ukraine rather than repair works away from the front.
Moreover, last week the protests spread to other Ukrainian cities.
Protests in Kyiv. Photo from the internet
But this did not stop the Odesa authorities. The agreement to restore Odesa’s Kyivskyi District Court was signed on 5 September.
The city’s Capital Construction Department did not hold an open tender to select the most advantageous bid and save public funds. Instead, it awarded the multimillion-hryvnia contract to the sole bidder, Odesholovpostach Private Joint-Stock Company, which regularly receives taxpayers’ money through similar agreements.
Trying to polish his image
With the Odesa protests attracting broad support across Ukraine, Odesa Mayor Hennadii Trukhanov “went on the counterattack”.
On 27 August, for instance, Deputy Mayor Oleksandr Filatov said in a comment that supposedly only 10 million hryvnias, rather than the full 106 million, would now be allocated to the court. Nevertheless, the contract was signed for 106 million. Most likely, the balance will be paid to the contractor next year. The declared deadline for completing the work is 31 December 2024.
Hennadii Trukhanov is also trying hard to show that the city does not spend money only on court and road repairs, but also supports those defending Ukraine. Yet his attempt to improve his image is going rather badly.
For example, on 20 September, Andrii Tantsiura, a hospital volunteer, wrote on Facebook about Hennadii Trukhanov’s visit to a military hospital. He reported that the city would allocate 16 million hryvnias in public funds to renovate the hospital’s admissions department and the volunteers’ room. It is unclear, however, why money should be spent on renovating the volunteers’ room instead of going directly to wounded defenders. Trukhanov also promised to provide five million hryvnias of taxpayers’ money to purchase medicines. He also supposedly said that the hospital’s bomb shelter had already been renovated at the city budget’s expense. Tantsiura did not say how much that cost.
Yet the disparity in the funding is striking: it turns out that 106 million hryvnias is being allocated to repair the court, and only 21 million to wounded service personnel. The contract for work on the court has already been signed, while Trukhanov has merely promised the hospital renovations and medicine purchases.
Following the protests, Odesa’s Executive Committee, chaired by Trukhanov, also urgently adopted a decision allocating 102 million hryvnias to purchase drones and monoculars for the military. But Odesa City Council members still have to approve the decision at a session scheduled for 27 September. When these essential supplies will actually be purchased and handed over to the military remains entirely unknown.
If the city authorities had cancelled the court renovation procurement, they could have allocated another 106 million hryvnias to the military. But Trukhanov apparently has no intention of listening to the city’s residents, although it is precisely service personnel who generate enormous revenues for Odesa’s budgetthrough their registration at military units stationed in our city.
Let us also remember that the Kyivskyi District Court has for several years been hearing one of the most high-profile and tragic cases: the fire at the children’s camp Viktoriia. A major factor in the fire was the construction of the camp’s accommodation blocks with serious breaches of building regulations and fire safety requirements. It was Panov’s department, let us recall, that commissioned these buildings with budget funds and accepted them into service.
Incidentally, the contractor involved then received declarations from officials both for the commencement and the completion of construction work just one day apart.
Declaration of works at the Viktoriia camp
And this did not alarm Odesa’s Capital Construction Department in the slightest. It accepted the unsafe facility into service. Just a few months later, a fire claimed the lives of three little girls.
And who will restore theOdesa court?
Another interesting question is who received the multimillion-hryvnia public contract from city officials. The company Odesholovpostach was registered in 1998. Its authorised capital amounts to just 162,000 hryvnias.
Since 2015, the company has regularly won public contracts, signing agreements worth more than 630 million hryvnias in total. The year 2023 set a record: it signed agreements worth almost 180 million hryvnias of public funds.
In 2017, the company came to the attention of law enforcement. According to the investigation, Odesholovpostach signed a contract with Odesa’s Municipal Economy Department to carry out emergency works in a residential building. But it did not complete all the work, even though it received the money after city officials signed the acceptance certificate. The case apparently stalled and never reached court. Meanwhile, Odesholovpostach only increased the number of public contracts it secured from the Odesa authorities.
A certain Oleksandr Fridman is listed as the owner of Odesholovpostach.
Now, during the full-scale war, he is attempting through the courts to exert pressure on a Czech company with which he signed an agreement to acquire property measuring more than 5,000 square metres.
Fridman signed the agreement on 6 October 2022 for more than 32 million hryvnias, or 905,000 euros. By then the bloody war had already been raging for more than seven months. Under the agreement, Fridman transferred 50,000 euros to the Czech company. But the company is now supposedly no longer responding to him. That is why he went to court.
The company in question is Bugaz invest s.r.o. Its name suggests that this supposedly Czech company may have non-Czech roots. And the case over 905,000 euros is being heard — (un)surprisingly — by Odesa’s Kyivskyi District Court, the very court that Fridman’s company is due to renovate at Odesa taxpayers’ expense.
Bugaz invest s.r.o. is listed as a founder of three Ukrainian limited liability companies: BC Park, Soiuz-Neptun-Enerhiia and Odesa Neptune Plant.
YouControl screenshot
The latter two companies are registered at 28 Borovskoho Street in an industrial zone. The address of Park Business Centre, however, is 92a Koroliova Street.
It appears that Oleksandr Fridman, a favoured recipient of public contracts from Odesa officials, bought part of this building.
As for the Czech-or-not-Czech company, according to data from the analytical system, YouControl, Bugaz invest s.r.o. belongs to Prague resident Svitlana Melnikova, who may be of Russian origin.
The companyBugaz invest s.r.o. was registered in Prague in 2018. It specialises in wholesale trade, weekend accommodation, real estate transactions and other activities. Another notable detail is that the company’s director is a certain Maksym Biliavskyi. Judging by his profile on LinkedIn, Biliavskyi moved to the Czech Republic back in 2003. At the time, he appears to have worked for the Russian company Gaz Invest, including translating from Czech into Russian.
To sum up, business involving Odesa’s budget evidently pays its beneficiaries substantial dividends, which they invest, among other things, in property registered in their own names. And all of this is taking place during a bloody full-scale war, while volunteers are forced to collect donations little by little to provide defenders at the front with everything they need. So what exactly are Odesa residents protesting about?