Top Ukrainian cyber officials fired after allegedly pocketing kickbacks from govt IT deals

Duo probed over alleged $2M embezzlement plot

Ukraine has terminated its two top cybersecurity officials as the government probes embezzlement allegations against the two men.

Yuriy Shchyhol, the head of the State Service of Special Communications and Information Protection of Ukraine (SSSCIP), and Victor Zhora, SSSCIP deputy chairman and chief digital transformation officer, have been fired, according to senior cabinet official Taras Melnychuk.

Dmytro Makovskyi has temporarily taken over as SSSCIP leader, Melnychuk added in a post on Telegram, which was later confirmed by the SSSCIP.

Melnychuk’s post does not explain why the men lost their jobs. The National Anti-corruption Bureau of Ukraine (NABU), meanwhile, said had it uncovered an embezzlement scam within the SSSCIP, and said the two cyber chiefs are among six suspects under investigation.

The SSSCIP in a statement on Monday disputed the anti-corruption bureau's findings, and said all of the agency's "procurements have been in line with legislation in force."

"We urge you to refrain from accusations of certain officers or executives involved in organizing protection of Ukraine's critical information infrastructure until the investigation is completed and the court provides its legal treatment of the investigation results," the statement continued.

When asked about the firings, Zhora told The Register: "I cannot share lots of details and add anything to SSSCIP statement." Zhora, who has previously spoken at length with The Register about the cyberwar being waged in Ukraine, said: "It's a war in all its dimensions."

Meanwhile, US support for Ukraine remains strong. "Our partnership with the government of Ukraine remains strong, and we will continue to support efforts to bolster the cybersecurity and resilience of Ukraine’s critical infrastructure,” a spokesperson for the US government's Cybersecurity and Infrastructure Security Agency told us.

In a separate xeet, Zhora on Monday said he had "completed" his term as deputy chairman. "It will be superfluous to talk about the successes of the service as a whole, the CERT-UA team and the State Cyber Protection Center, in particular, during the war."

According to the anti-corruption cops, the plot allegedly involved Shchyhol, Zhora, the general director, an employee of a state-owned enterprise, and the owner of a group of companies and one of his employees.

Between 2020 and 2022, the six allegedly embezzled more than ₴62 million Ukrainian hryvnias ($1.7 million) in government funds in a scam that involved the SSSCIP awarding software and IT services contracts to suppliers without opening the procurement process to other vendors.

Instead, SSSCIP officials apparently ensured the deals went to the two unnamed software companies, with the government paying more than ₴285 million ($8 million) in 2021-22. The Ukraine law enforcement agency says the real value of the products was ₴223 million ($6 million) and the six men split the extra cash. In effect, it's claimed, the g-men steered government IT contracts to two specific organizations and took kickbacks as a reward.

"These funds were transferred to the accounts of controlled companies abroad for the purpose of legalization and distribution among the members of the organized group," according to the NABU.

The SSSCIP, for its part, has said procurements "are complex" and "their analysis requires training and grasp." The agency also offered to provide any needed clarifications to the NABU detectives. ®

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