The control and internal audit department of the State Railway Administration (Ukrzaliznytsia) implemented three control measures regarding publications and petitions alleging possible irregularities in the financial and economic operations of enterprises under Ukrzaliznytsia’s control during the second quarter of 2014, the Interfax Ukraine news agency reported, citing a Facebook post by Ukrzaliznytsia’s first deputy head Maksym Blank.
According to the official, an internal investigation was launched into the purchase and operation of Hyundai inter-regional high-speed electric trains by the Southern (Yuzhnaya) Railway and the state-owned Ukrainian High-Speed Railway Company. Materials of the investigation have been sent to the Central Investigation Department of Ministry of Interior Affairs of Ukraine.
An internal investigation was also conducted in connection with the contracts for equipping and washing railcars that the South-Western Railway concluded with the companies Zheleznyi Kulak, Master Clean, and Development XXI Century. The materials of this investigation have also been submitted to the prosecutor's office.
According to Blank, an investigation was also launched into abuses by the head of the Kiev-Passazhirsky train station during payment of monetary rewards to employees, as well as into cashiers’ settlements with passengers during ticket sales.
"In addition, at least two tenders were canceled in the period from 1 June 2014 alone: spare parts worth UAH 14.205 million for locomotives of the series 2TE116, 2M62, and 2TE10; parts for railway locomotives, self-propelled tramcars, and rolling stock; fixtures and fittings as well as parts for them; mechanical traffic control equipment worth UAH 34.198 million," said Blank.
He also said that a certain Ukrbizneskonsalting LLC (Poltava) has filed a complaint with the Antimonopoly Committee of Ukraine over Ukrzaliznytsia’s tender for procurement of services involving valuation of the assets and property rights that will form the authorized capital of the Ukrainska Zaliznytsia joint-stock company.
"Ukrzaliznytsia invited tenders for valuation of the assets and property rights for the purpose of its conversion into a joint stock company. The requirements set for the valuator are tough, but the competition is open, transparent, and everyone wishing to participate was invited. Proposals have been unsealed. Obviously, the choice will be made in favor of one of the world's largest audit firms, but we are finding out that the Poltava-based Ukrbizneskonsalting company has managed to file a complaint with the Antimonopoly Committee before completion of the tender procedure and that the committee has decided to consider this complaint in a month,” Ukrzaliznytsia’s first deputy head said.
He added that this could slow down the process of reform of the railway sector.
As reported, Deloitte & Touche, Ernst & Young, and Baker Tilly Ukraine are participating in the tender for valuation of the assets and property rights of Ukrzaliznytsia. The latter company is offering to provide the service for UAH 3.167 million (excluding VAT) or UAH 3.8 million (including VAT), Deloitte & Touche for UAH 12.5 million (excluding VAT) or UAH 15 million (including VAT), and Ernst & Young for UAH 14.167 million (excluding VAT) or UAH 17 million (including VAT).
