Ukraine's anti-corruption court convicts former presidential advisor in Ukrzaliznytsia procurement fraud

Why it matters

The conviction of a former presidential advisor for wartime procurement fraud targets corruption inside the state rail company Ukrzaliznytsia at a moment when Ukraine's logistics network is critical to the war effort. The seizure route through a Belarus-linked supplier and a Bulgarian shell company adds a national-security layer: beyond the loss of roughly 95 million hryvnia, the case illustrates wartime procurement vulnerabilities. Shylo's avoidance of actual prison time under a plea deal — alongside the financial penalties and his obligation to testify against others — shows how Ukraine's anti-corruption framework resolves high-profile cases through cooperation.

What happened

On 13 October, Ukraine's High Anti-Corruption Court (VAKS) approved a plea agreement with Artem Shylo, a former advisor to the Office of the President and ex-SBU officer. He was found guilty under Part 3 of Article 27, Part 5 of Article 191, and Part 3 of Article 209 of the Criminal Code of Ukraine — organizing the misappropriation of property in especially large amounts and the legalization of criminal proceeds. The court imposed an 8-year prison sentence but, under Article 75, released him with a 3-year probationary period and a 3-year ban on positions with organizational-managerial or administrative-economic powers in military formations and law enforcement bodies.

As part of the plea deal, Shylo must pay a 204 million hryvnia fine in quarterly installments of 51 million hryvnia over one year, and the court applied special confiscation to 325.7 million hryvnia in funds and three apartments (one of 183.5 sq. m. and two of 102.3 sq. m., totaling 388.1 sq. m.). The court also lifted the seizure on his personal Mercedes-Benz car. He undertook to compensate 60 million hryvnia in damages and transfer 80 million hryvnia to the charitable foundation "Come Back Alive" (Повернись живим), and to provide incriminating testimony against other suspects.

The case stems from a scheme that operated from June to December 2022, in which Shylo's organized group used controlled Ukrzaliznytsia officials to select a predetermined supplier of power transformers at inflated prices. The winning company was controlled by a Belarusian citizen with ties to Russia; it bought transformers from a producer in Uzbekistan via a shell firm registered in Bulgaria and resold them to Ukrzaliznytsia at nearly double the price. Ukrzaliznytsia's losses from the scheme are reported as 94.7 million hryvnia in some sources and 94.8 million in others, with NABU/SAP citing nearly 100 million hryvnia.

NABU and SAP exposed the group on 2 April 2024, suspects were notified on 3 April, and Shylo was taken into custody on 4 April with an alternative bail of 30 million hryvnia, which was posted within hours. The agreement with Shylo is the third plea deal in the so-called "back office" episode; earlier agreements were reached with realtor Oleksandr Liskovatsky and SBU employee Oleksandr Kovalyuk, and a fourth suspect, Kostiantyn Melnyk, has said he is willing to plead but his deal has not yet been approved.

How Ukrainian sources describe it

All sourcing for this story is Ukrainian, and outlets from Interfax-Ukraine and Ukrinform to Babel, hromadske, ZN.UA, Radio Svoboda and NV report the verdict in broadly similar terms — emphasizing the conviction, the 204 million hryvnia fine, the confiscation of three apartments and 325.7 million hryvnia, and the fact that Shylo avoided serving prison time. Coverage centers the work of VAKS, NABU and SAP, with Transparency International Ukraine announcing the agreement. Several outlets stress the wartime context and the Belarusian/Russian-linked supplier as a national-security dimension, while also detailing Shylo's proximity to Deputy Head of the Office of the President Oleh Tatarov and referencing a 2022 Bihus.Info investigation that found he had accumulated nearly $4 million in assets over a decade of public service. Additional obligations in the deal — 60 million hryvnia in damages, an 80 million hryvnia transfer to the "Come Back Alive" foundation, and an obligation to testify against other suspects — receive explicit mention.

Where reporting differs

Sources differ on the exact amount of Ukrzaliznytsia's losses from the transformer scheme: 94.7 million hryvnia in some reports versus 94.8 million hryvnia in others, with NABU/SAP also citing nearly 100 million hryvnia.

The amount of funds subject to special confiscation is reported as 325.7 million hryvnia in most sources and 325.78 million hryvnia in one outlet (Babel).

Background

The organized group is described in Ukrainian reporting as a "back office" set up to misappropriate Ukrzaliznytsia funds through procurement manipulation. Shylo is a former SBU officer who served from 2012 — first in Kharkiv and then from 2016 in Kyiv in the cyber-crimes department — became an out-of-staff advisor to the Office of the President in 2021, and returned to the SBU in 2022 to head a newly created Main Directorate for counterintelligence protection of critical infrastructure objects and counter-financing of terrorism. A 2022 Bihus.Info investigation reported that he had accumulated nearly $4 million in assets over a decade of public service, and outlets describe him as close to Deputy Head of the Office of the President Oleh Tatarov.

The Shylo case is part of a broader NABU/SAP investigation into Ukrzaliznytsia procurement fraud that has produced separate suspicion notices — including for MP Viktor Bondar on 17 January 2025 — and indictments against two former Ukrzaliznytsia officials and ten other group members. Two earlier plea deals in the same "back office" episode were reached with realtor Oleksandr Liskovatsky and SBU employee Oleksandr Kovalyuk, and a fourth co-organizer, Kostiantyn Melnyk, has expressed willingness to plead but has not yet been approved by the court. Reporting also links Shylo to the appearance in Ukraine of the Russian-linked bookmaker 1xBet.