Ukrainian Fraud Scandal Deepens as Zelensky Sanctions Ex-Business Partner

Ukrainian President Volodymyr Zelenskyy on Thursday imposed sanctions on a former business associate implicated in a major corruption scandal that has angered a nation worn down by nearly four years of war.

The move came just a day after Zelenskyy requested the resignation of two cabinet ministers in an effort to distance himself from allies allegedly involved in a large-scale money-laundering scheme.

Anti-corruption officials say the scheme diverted $100 million from Ukraine’s energy sector, already crippled by relentless Russian strikes that have caused severe power shortages. Investigators identified 46-year-old businessman Timur Mindich—widely reported in Ukrainian media as a longtime associate of Zelenskyy—as the mastermind.

The president’s office issued a decree imposing “personal special economic sanctions” on Mindich and another businessman, Oleksandr Tsukermann. The measures include freezing their assets, revoking state honours, and restricting their travel and business activities. Both men hold Israeli citizenship and are believed to have fled Ukraine.

Following a call with German Chancellor Friedrich Merz, Zelenskyy said Ukraine would do everything necessary “to strengthen partners’ trust,” though he did not mention the scandal directly.

Donors Demand Tougher Action

Mindich’s alleged involvement poses political risks for Zelenskyy, who has positioned himself as a reformer throughout the war. A European diplomat in Kyiv told AFP that Ukraine’s leadership “needs to be cleaned of corrupt elements,” while noting that the scandal also demonstrated improved effectiveness of the country’s anti-graft agencies.

Germany—Kyiv’s biggest EU donor—stressed that it expects stronger anti-corruption measures, while Hungarian Prime Minister Viktor Orbán, a frequent critic of Ukraine, claimed that a “war mafia network” tied to Zelenskyy had been exposed.

The International Monetary Fund, from which Kyiv is seeking additional funding, reiterated that tackling corruption remains a “central pillar” of reforms expected by international partners.

‘He Can Go to Hell’

A senior Ukrainian official told AFP that Zelenskyy was enraged by the revelations and has not spoken to Mindich since the scandal broke. Mindich co-owned Kvartal 95, the production company founded by Zelenskyy during his days as a comedian.

“What is there to talk about? He can go to hell,” the official said, speaking anonymously and adding that the president was “stunned” to learn of the alleged scheme.

Zelenskyy dismissed his justice and energy ministers on Wednesday as part of the fallout.

“The president has taken the toughest steps he could within his powers,” the official added.