Transparency International Ukraine on ARMA reform: important step, but there are corruption risks

Adoption in the first reading of the draft law on comprehensive reform of the Asset Recovery and Management Agency is necessary for the further development of Ukraine, but without further revision it may leave serious problems in the system of management of seized assets. This was stated by Transparency International Ukraine, according to UNN. 

Details

Today, the Verkhovna Rada of Ukraine passed in the first reading the draft law No. 12374-d, which is to become the basis for a comprehensive reform of the Asset Recovery and Management Agency. This draft law is part of the implementation of the Ukraine Facility Plan with a deadline of March 31.

Anti-corruption experts emphasized that the draft law adopted in the first reading takes into account the recommendations that Transparency International Ukraine identified as critical for the reform of the ARMA.

At the same time, the organization said that the document contains a number of problematic aspects that need to be addressed for a quality reform of the agency:

• the probable low motivation of managers of seized assets under the new model, as well as certain corruption risks in compensating for “necessary expenses,” the organization proposes to introduce a system of remuneration for managers with a lower base rate (1-3 minimum wages) and a higher percentage of profits (20-25%), reducing the burden on the state budget;
• unjustified narrowing of qualification requirements for candidates for the head of the ARMA. TI proposes to allow candidates with economic education to participate in the competition, as the requirement for a law degree does not take into account the need for managerial and economic competencies for effective management of the agency;
• complicated asset management model before the new regulation is introduced, instead, clear quantitative and qualitative criteria for assessing the effectiveness of management for different types of assets should be developed;
• lack of improvement in the content of the Unified Register of Seized Assets, since for effective public control it should contain at least the date of the start of property management measures and the announcement of a tender for the manager, the essential terms of the management agreement (amount of remuneration, guaranteed payment, as well as the results of monitoring measures for the effectiveness of asset management).

"Transparency International Ukraine recommends finalizing this draft law in preparation for the second reading and ensuring comprehensive development of amendments to the CPC of Ukraine," the organization emphasized.

Recall

Experts and MPs have emphasized that changes in the procedure for electing and dismissing the head of the Asset Recovery and Management Agency are long overdue and correct. Given the recent negative opinion of the Accounting Chamber, these changes may become the basis for the appointment of a new head of the ARMA.

Add

Recently, the current head of the Asset Recovery and Management Agency, Olena Duma, received "excellent" in her performance evaluation in 2024. This means that she will not only retain her position, but will also receive a bonus for her "outstanding achievements.

However, numerous scandals around the agency call into question the transparency and effectiveness of its leadership. For example, under Olena Duma's leadership, ARMA has repeatedly been at the center of high-profile scandals. One of the most recent was an investigation into possible fake disability certificates that  agency employees received. Experts emphasized that if the allegations are confirmed, this should not only be grounds for resignation, but also an impetus for a large-scale review of the agency's work .

In addition, anti-corruption organizations have repeatedly criticized the agency for not meeting European standards. They emphasized populism, contradictory communication and violation of the presumption of innocence by ARMA officials.