How corruption in Ukraine is destroying the economy

Despite its rich natural resources and human potential, Ukraine remains one of the poorest countries in Europe. The main factor contributing to this reality is the pervasive corruption that has penetrated all levels of government. Corruption continues to undermine the Ukrainian economy, creating significant barriers to foreign investment and hindering the development of a fair, competitive business environment.

Despite loud statements about the fight against corruption, this problem remains one of the main obstacles to the country’s progress. General impunity, the power of officials and the law enforcement system, which practically ignore the laws and the Constitution, create fertile ground for various shadow schemes. A striking example is the Asset Recovery and Management Agency (ARMA), which is often used for hostile takeovers of enterprises without any legal proceedings, clearly ignoring the presumption of innocence.

Unconstitutional and corrupt programs like ARMA should not be allowed to exist. Such government programs have destabilized and destroyed the country’s economy.

Under the guise of patriotism, law enforcement officers seize factories and enterprises, transferring them to ARMA. Then, without a final court decision, ARMA transfers them to its private companies – this is global raiding and trampling of all constitutional provisions.

Meanwhile, law enforcement agencies, instead of upholding justice, are increasingly becoming involved in corruption scandals, extorting bribes from entrepreneurs and then transferring their cases to ARMA. This agency, in turn, transfers the management of these enterprises to “connected” persons, which is tantamount to illegal seizure of property from legal owners who refused to pay a bribe or became victims of the greed of corrupt officials.

The case of Cryoin Engineering is a stark example of how businesses can be targeted for refusing to engage in corrupt practices.

Corruption vs. Business: How Cryoin Engineering Became a Victim of the System

Image: Cryoin Engineering – Rare Gases Manufacturer

Before the war, Cryoin was a key supplier of neon gas, an essential component in the production of semiconductor chips. The company’s client network extended across Europe, Asia, and North America, with the United States being its most important market. As a responsible business, Cryoin made substantial contributions to Ukraine’s economy through tax payments and actively supported the Ukrainian Armed Forces. Employing over 200 skilled professionals, Cryoin stood as a model of corporate responsibility and national pride.

Image: Medal for Supporting the Ukrainian Air Force

Cryoin Engineering’s management was even awarded a medal for its significant contributions to supporting the Ukrainian Armed Forces, a testament to the company’s dedication to the country. Under normal circumstances, such companies should be supported and celebrated. However, in an unfortunate turn of events, Cryoin now faces unfounded accusations as a result of the rampant corruption in Ukraine. Instead of nurturing business growth, the system punishes those unwilling to participate in corrupt schemes, demonstrating how even the most dedicated and successful enterprises can be targeted unfairly.

Timeline of Events

Sale of Products to Turkey:

In February 2022, at the onset of the war, Cryoin Engineering sold helium cylinders and equipment to a company in Turkey, a NATO member. This legitimate transaction was later twisted to accuse Cryoin of treason and collaborating with Russia, despite having no connections to Russian interests.

Pressure from Borisov:

The company soon came under intense pressure from Yevgeny Borisov, a notoriously corrupt Ukrainian military commissar known for illegally amassing over $4 million. Borisov attempted to extort $2 million and demanded a 60% stake in Cryoin Engineering. When the company refused to comply with his demands, it became the target of a hostile takeover disguised as an act of patriotism.

Criminal Cases and Raids:

Following Cryoin’s rejection of Borisov’s extortion attempt, the company was falsely accused of producing weapons for Russia, despite specializing in inert gases for medical and electronic purposes. In September and December 2022, the Security Service of Ukraine (SBU) and the Prosecutor General’s Office conducted raids that paralyzed the company, confiscating equipment without any evidence. In February 2023, new accusations of collaborating with Russia emerged, leading to further raids and the complete seizure of all company assets in March 2023.

Image: The company is being raided by the Security Service of Ukraine

Unwarranted Seizure of Company Property

In April 2023, all assets belonging to Cryoin Engineering were seized and transferred to the Asset Recovery and Management Agency (ARMA), despite there being no court ruling finding the company guilty of any wrongdoing. ARMA now plans to hand over these assets to its affiliated firms, continuing its effort to take over Cryoin Engineering under false pretenses.

Continued Aggression Despite Borisov’s Arrest

In the summer of 2023, Yevgeny Borisov was dismissed from his position and charged with corruption; he is currently serving time in prison. However, this did not halt the aggressive takeover of Cryoin Engineering, as efforts to unlawfully seize control of the company’s assets persist.

Image: Yevgeny Borisov Arrested on Corruption Charges

Expert Assessments

Independent experts have verified that the helium and neon produced by Cryoin Engineering are not utilized in the military sector. Their findings refute all allegations against the company, eliminating any connections between its operations and arms manufacturing.

Image: Official Conclusion from Independent Expert

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Expert Conclusion: Helium and neon (with a purity level of no less than 99.99%) are not used in the military industry for the production of military equipment, firearms, or their components.

Shaping Public Opinion

To tarnish Cryoin Engineering’s reputation, the raiders resorted to media platforms like NV.ua, which allegedly accepted illegal payments to spread false narratives. These accusations encompass baseless assertions regarding the use of Russian raw materials and helium in weapon production. However, Cryoin’s technology does not rely on such imports. This disinformation not only harms the company’s image but also erodes confidence in Ukraine’s investment environment.

Final Thoughts

While Ukrainian leaders appeal to the global community for financial assistance, systemic looting of resources continues within the country. The impunity of officials, disregard for laws and the Constitution, and business takeovers through the Asset Recovery and Management Agency (ARMA) create an extremely unfavorable investment climate.

Ukrainian officials are constantly requesting financial aid, but the pressing questions remain: Where will this money go? How will it be utilized? Will it genuinely benefit the suffering Ukrainian people, who endure daily attacks from Russian missiles and the greed of corrupt officials? Investors see their funds at risk of being misappropriated. Corruption in Ukraine poses a significant barrier to foreign investments and hinders the development of a fair and competitive business environment.

The international community should focus more on monitoring the funds allocated as aid to ensure that the money effectively supports the Ukrainian people, who are currently fighting for their future and the future of Western civilization. The case of Cryoin Engineering highlights how corruption can destabilize vital industries with global consequences. As the semiconductor sector struggles with the loss of a key supplier, the world is witnessing the destructive impact of unchecked corruption in Ukraine. It is essential for the international community to acknowledge these dangers and support initiatives that promote transparency and accountability at all government levels, enabling businesses like Cryoin Engineering to operate without fear of corrupt interference.

Government and law enforcement agencies have severely impacted over 70 percent of the Ukrainian economy. Ukraine heavily relies on American and Western aid; without it, the country’s budget is at risk of collapse at any moment, threatening its very existence as a state. On one hand, Ukrainian officials continue to live lavishly, laundering their assets and purchasing expensive homes and luxury cars, while ordinary citizens endure the chaos of government lawlessness and job losses. On the other hand, Russia persists in shelling peaceful cities and villages across Ukraine daily. The Ukrainian people find themselves trapped in an untenable situation that cannot last indefinitely.

The current leadership in Ukraine is aptly summed up by a quote from Abraham Lincoln: 

“You can fool some of the people all of the time, and all of the people some of the time, but you cannot fool all of the people all of the time.”

This unacceptable situation demands global attention. The international community must take decisive action against corrupt Ukrainian officials, enhance monitoring of illicit financial flows, and hold accountable those involved in corporate raiding and bribery.