American Foreign Policy Council

Ukraine Reform Monitor No. 20

January 16, 2026 Ilan I. Berman, Matthew Cesare
Related Categories: Democracy and Governance; Energy Security; Corruption; Russia; Ukraine

SPECIAL ISSUE: A MAMMOTH CORRUPTION SCANDAL 

Back in November, Ukraine's main anti-corruption bodies, the National Anti-Corruption Bureau of Ukraine (NABU) and the country's Specialized Anti-Corruption Office (SAPO) uncovered a massive graft scheme involving Energoatom, the state nuclear energy company. According to the two agencies, Energoatom had coerced contractors to provide kickbacks of up to 15% to its officials and functionaries. NABU and SAPO's investigation, dubbed "Operation Midas," is said to have lasted well over a year and to include 1,000 hours of audio recordings. Those involved in the scheme include a former adviser to the country's energy minister, Energoatom's executive director for physical protection and security, and a "businessman well known in the media," among others. The scandal, reportedly the biggest of its kind in Ukrainian history, encompassed an estimated $100 million in funds embezzled from the country's energy firms. Politically, it had a dramatic effect on perceptions of governance, both within Ukraine and abroad.

A MAJOR LOSS OF CONFIDENCE...
At home, the aftermath of the Energoatom scandal was characterized by a massive drop in public confidence in the government of President Volodymyr Zelenskyy. A mid- to late November poll carried out by the Info Sapiens polling group detailed that "[t]he population places the most responsibility for this cause on the current government (the survey lists [Prime Minister] Yulia Svyrydenko's government and President Volodymyr Zelenskyy) - 59%, and 40% - on the direct participants of the corruption scheme." (Interfax-UA, December 5, 2025)

...AND A PROBLEMATIC SECTOR...
The scandal unearthed by NABU and SAPO is part of a larger – and worrying – trend that has affected Ukraine's energy sector writ large. A Fall study by the Ukraine Facility Platform, an independent Ukrainian think tank, detailed that the Ukrainian government had rapidly expanded its control over the country's energy sector since the start of the war with Russia in February 2022, with deleterious effects. "This shift has not reduced corruption; in many cases, corrupt practices have persisted or worsened," the report outlined. (New York Times, November 10, 2025)

...FANS WORRIES IN EUROPE
In the wake of the scandal, concerns over Ukrainian backsliding on corruption also spiked in Europe, where support for Kyiv – and consideration of Ukraine's potential accession to the European Union – has been contingent on reform. EU officials warned the Ukrainian government to maintain its focus on identifying and eliminating graft inside the country. In what amounted to a public warning to Zelenskyy, the office of German Chancellor Freidrich Merz "underlined the German government's expectation that Ukraine press ahead energetically with fighting corruption and further reforms, particularly in the area of the rule of law." (PBS, November 13, 2025)

RUSSIA SEIZES ON THE CORRUPTION NARRATIVE...
Meanwhile, the Energoatom scandal played into the Kremlin's hands. In the wake of the disclosures, Russian state media outlets amplified the scandal as evidence that Ukraine's government and leadership were thoroughly corrupt, and that the country as a whole is an unreliable ally for the West. (RT, November 17, 2025)

...AS HEADS ROLL IN KYIV
In the wake of the scandal, a number of high-profile Ukrainian officials have been cashiered or resigned. None, however, are as prominent as Andriy Yermak, President Zelenskyy's chief of staff. Yermak resigned in late November, following a raid on his home by anti-corruption authorities. (BBC, November 28, 2025)

BUT AT THE END, ZELINSKY’S POPULARITY REBOUNDS
In the final calculus, however, the scandal does not appear to have done lasting damage to President Zelenskyy's administration – or his approval rating among Ukrainians. A year-end poll by the Kyiv International Institute of Sociology (KIIS) found that nearly two-thirds of respondents (59%) said they trusted the President and his handling of both domestic and international affairs. The figure, though slightly lower than that of early December, is nonetheless a marked improvement over the 49% who shared the same sentiments in the immediate aftermath of the scandal. "In general, the president lost about 10% of public trust after reports of corruption in the energy sector emerged. But following that, against the backdrop of international developments (namely peace negotiations), we observed another round of 'rallying around the flag' and a renewed boost in trust. However, by late December, that 'rally effect' had somewhat faded, with trust levels showing a slight downward trend," the KIIS survey lays out. (New Voice of Ukraine, January 5, 2026)

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