High-profile corruption scandals at Ukrzaliznytsia and Ukroboronprom have exposed schemes by which billions of state hryvnias were embezzled for years. But scandalous revelations have also long been pending in the Ministry of Health system, where a tender mafia, protected by high-ranking officials and members of parliament, has long profited from the procurement of equipment and medicines. Among them are the firms of the Fistal brothers, long associated with the odious Tatyana BakhteevaThe "Donetsk" continue to plunder Ukraine today, and neither the Maidan nor the ATO have stopped them.
Volodymyr Fistal and Herman Fistal: How Ukraine's Healthcare Budget is Being Embezzled. Part 1
One would like to believe that the new scandal began with the SBU investigation, which uncovered staggering corruption surrounding the supply of hemodialysis machines and medications, on which the lives of thousands of Ukrainians literally depend. All of this was then reported by journalists in a television report, naming several embezzlers of budget funds and naming the sum of their profits—approximately 7 million hryvnias. It would seem like another victory against corruption worth celebrating, but…
Only 7 million hryvnias? Isn't that a lot of money for those who, according to the data, Skelet.Org, making fortunes in the tens of millions of dollars (at a minimum) from this. And why did the investigation only cover a couple of cases, naming only a couple of names and companies, while remaining silent about the other participants in the shady schemes and their patrons? Other journalists wondered if this was a plot by rival corrupt officials. And they eventually traced the firms of the Fistal brothers, who have long since become a legend in the shadowy schemes of Ukrainian healthcare.
Medical dynasties of Donetsk
German and Vladimir Fistal are extremely private people – there are no biographies or even photos of them (except perhaps the occasional profile) available on publicly available websites. This is understandable given their lifestyle and business, where it's unwise to expose their name and face unnecessarily. And over the past few years, their "anonymity" (and that of others) has been further facilitated by Ukraine's self-imposed information blockade, which, under the pretext of "fighting enemy propaganda," has cut off Ukrainians from many online resources in Russia and the self-proclaimed "republics" of Donbas. It's very convenient for those who don't want anyone to find information about them on Yandex or the "DPR" websites. Meanwhile, it all began in Donetsk – and some things are still happening there.
The brothers owe their current status to two people, without whom they would now be, at best, selling plumbing fixtures at the market. The first is their father, Emil Yakovlevich Fistal, a renowned Donetsk physician, surgeon, and director of a burn center, considered one of the pillars of national medicine (or at least, that's how he was "promoted"). He was born on February 20, 1939, in Makeyevka, to a family of Soviet intellectuals. He could have become a violinist, a teacher, or an accountant, but his parents insisted that young Emil follow in the footsteps of his aunt and uncle and become a doctor. Although he was accepted to the Donetsk Medical University only on his second attempt, Emil Fistal established himself as a skilled surgeon, specializing in severe burns—and built his entire career on this. While he could have simply operated, remaining a humble doctor, he chose to operate and manage, and then manage and operate. And at the same time, he taught at the same medical institute, where he met the feisty student Tanya, who a few years later married and became Tatyana Bakhteyeva. However, given that Bakhteyeva herself comes from a family of Donetsk doctors, it's possible that they met Fistal much earlier.
Emil Fistal
On February 16, 1964, Emil Fistal, a student, had a son, Herman. On January 2, 1971, when he was already working as a surgeon at a burn center, he had a second son, Vladimir. Incidentally, his son Vladimir was registered at Emil Fistal's old address (139 Leninsky Prospekt) in Donetsk, as was a certain Nina Emilievna Fistal, born in 1998—apparently his daughter from his second marriage. Well, one can only envy that!
German Emilievich and Vladimir Emilievich (the "blue thief" Pasha Emilievich comes to mind) showed no talent for medicine and had no desire to treat people. Their childhoods were far from poor, especially the younger Vladimir's. In their youth, they also had everything they needed, but they always longed for more. During perestroika, they opened some kind of cooperative, but their business only really took off in the mid-90s. Journalists routinely linked this to the rise of Rinat Akhmetov's gang and the appointment of Viktor Yanukovych as governor of the Donetsk region, but not everything in Donetsk revolved around Akhmetov. The region was home to old and new clans, and the Fistals belonged to the "old Donetsk clan" (the Soviet elite), among whom they had all their connections.
Then Tatyana Bakhteeva reappeared in their lives—the second person to whom the Fistals owe their well-being. Bakhteeva is also always considered one of the Akhmetovs' closest associates, but even here, things aren't so simple. Bakhteeva was close to Zhigan Taktashev, who was once Akhat Bragin's (Alik Grek) right-hand man and somewhat of a rival to Akhmetov. Bakhteeva became related to the Valitov family, also close to Taktashev—he participated in their joint business. Andrey Adamovsky, a business partner of Alexander Granovsky. Bakhteeva's husband worked for a corporate raider. Vladislav Dreger, associated with the notorious organized crime group "17th Precinct." Finally, Bakhteeva was often seen in the company of Gennady Uzbek, another Donetsk "authority figure."
And so, in 1997, Tatyana Bakhteeva became the general director of the Donetsk Regional Medical Association, bringing all regional healthcare under her control. That same year, German Fistal founded the private enterprise "Donmed" (Production and Commercial Firm), through which he began running his medical-related business, sharing the profits with Bakhteeva. The essence of this business has remained unchanged for the past 22 years: "sawing up" the healthcare budget through the purchase of equipment, medications, and technology for medical institutions.
And it's not like the venerable Dr. Emil Fistal didn't know what his clueless sons were doing for a living. Of course he did! Moreover, according to sources Skelet.OrgThey took their first steps in business with the help of their father's burn center, purchasing medications for it through their company and even opening a workshop to manufacture some plastic medical products. But the burn center's budget was limited, and the brothers' real prospects opened up when Tatyana Bakhteeva granted them access to the healthcare budget of the entire region, and then of Ukraine. Moreover, Bakhteeva chose the Fistals as business partners for a reason, and not just because she had known their father for a long time. The name of the renowned surgeon, the director of the center that saved the lives of hundreds of people, was an excellent cover for all sorts of shady schemes!
This name is now being widely used by the separatists of the "DPR." In 2014, Emil Fistal remained working in Donetsk, refusing to abandon his burn center and the Institute of Emergency Surgery, which even ended up in the infamous "Peacemaker" As a "terrorist accomplice." On the one hand, you can't blame the doctor for not abandoning his patients. On the contrary, we once admired the heroic Soviet doctors who refused evacuation in 1941 to stay with their patients. But on the other hand, Hitler didn't award these doctors Iron Crosses! Emil Fistal, however, received numerous awards in the "DPR." And not only for rescuing and treating wounded residents of Donetsk, but also rebels (they were human, after all!). By the way, remember the "Buryat tanker?" Dorji Batomunkueva, Burned in the fighting near Debaltseve? He was treated at the Fistal Burn Center, where Iosif Kobzon visited him.
Emil Fistal, Joseph Kobzon and Dorzhi Batomunkuev
Instead of quietly waiting out the hard times, Emil Fistal, as they say, is actively expressing his civic position—but not in support of Ukraine. In the spring of 2014, he claimed there were no separatists in Donetsk, and that Russian flags were being waved by some "foreigners," but then suddenly he himself became an ardent supporter of the "republics" and Russia. And now Emil Fistal threatened Ukraine with a "second Nuremberg Tribunal", he was friends with Zakharchenko and received from his hands the title of "Hero of Labor of the DPR"" He then publicly endorsed Pushilin. "To our great regret, the republic lost its leader, who died tragically. Now we face the dilemma of choosing from five candidates. I will vote for Denis Pushilin because he is a follower of Alexander Zakharchenko," Emil Fistal declared in October 2018, essentially campaigning for Pushilin. For this, a couple of months later, he received a new award from Pushilin: he was awarded the title of "Honored Doctor of the DPR."
But does Emil Fistal really mean what he says, or is he simply habitually fawning over the authorities, regardless of the color of their flags? This conclusion is suggested by the fact that, exploiting his image as a "legend of Donetsk medicine" and his status as a "savior of the people," Emil Fistal, along with his son Herman's companies, is actively "slicing up" the healthcare budget of the "Donetsk Republic," and is also siphoning off humanitarian aid from Russia. And you understand that access to such a trough is granted only for certain "services."
Rats in white coats
The Fistali brothers attempted to establish their first business by producing disposable syringes, which they intended to sell to their father's medical institutions. But even back then, in the 90s, the Fistalis realized that producing their own products wasn't very profitable and was much more difficult than reselling others'—sometimes passing them off as their own. Since then, this has become one of the hallmarks of their business. For example, in 2017, the Kyiv City State Administration held a tender for the supply and installation of 118 lifting platforms for wheelchair users, allocating 10 million hryvnias. The company "Ortoimpex" (founded by Yuriy Vasylenko, one of the Fistalis' associates) won the competition, offering its services for 9,98 million. At first glance, everything seems fair and transparent. But then it turned out that Ortoimpex would purchase these platforms from Dispomed Production Company LLC (EDRPOU 32250962), owned by the Fistal brothers. It then emerged that Dispomed doesn't manufacture these platforms itself. Furthermore, although Dispomed has been in business since 2003, it doesn't even manufacture the wheelchairs it sells under its own name. There are even doubts that it even produces crutches. No, everything is purchased from other companies, at best assembled from components, and at worst simply resold at a profit.
But there was something else, unfortunately, that journalists overlooked. If you review information about the tenders won and continue to win by Fistals' companies, you'll find one curious detail. They always offer a price slightly below the competitive bid, seemingly winning the tenders fairly—and there's nothing to criticize them for. Yet, they still make a 20-50% profit by selling equipment and medications well above their actual price. Incidentally, we're talking about actual price, not market price, because the Ukrainian market for medical equipment and medications is partially monopolized and divided among shadowy clans that deliberately inflate prices and prevent fair competition. But the actual price is the cost of similar goods and services in other countries (one might even say, global prices), from which, incidentally, most of the equipment is imported and then resold at tenders.
So, in the case of the lifts ordered by the Kyiv City State Administration, the cost of each one, even including installation, was 84,6 hryvnias. Experts pointed out that this price was greatly inflated: for that kind of money, you could buy a small electric car in Europe! But this price was set by the client (the Kyiv City State Administration), and Fistali's firm even offered a token discount. The same can be seen in most tenders in the Ukrainian healthcare system, and not just those involving Fistali: it was the clients who inflated the prices. Yet, the tenders were invariably won by their own, "preferred" firms. In other words, in this case, a shadow tender scheme within the Ministry of Health and Social Protection is exposed, whereby budget funds are essentially embezzled by chief physicians and officials themselves, but in conjunction with their own firms (or the firms of their trusted partners). The final say rests with whoever allocates the budget funds for this, signing off on a specific amount. You could call it "Bakhteyeva's scheme," since she was one of its architects, she controlled the flow of healthcare budgets, and she still uses it today. And yet, we shouldn't forget that even without Bakhteyeva, heads of medical institutions—including the "legendary" Emil Fistal—were lining their pockets for years using this scheme. Or do you think he wasn't aware of it when he signed inflated bills?
Oh yes, all these commercial doctors love to hide behind their regalia and image as people's saviors, but let's still think about this: because equipment and medications are purchased at inflated prices, medical services—surgeries, intensive care, treatment, rehabilitation—are also much more expensive. These same doctors charged Ukrainians for these services, complaining that budget funding wasn't even enough for green paint. Of course, "not enough," after all, it was stolen by these rats in white coats! And now let's think about how many Ukrainians died because they didn't have the money for these expensive surgeries and treatments, because the long line of "beneficiaries" didn't reach them. How many graves of the poor are there for every one rescued from the dead by heroic doctors who split half the cost of treatment among themselves, corrupt officials, and commercial firms? It seems this issue is no longer just corruption-related, but also political.
Sergey Varis, for Skelet.Org
CONTINUED: Vladimir Fistal and Herman Fistal: How Ukraine's Healthcare Budget is Being Embezzled. Part 2
Subscribe to our channels in Telegram, Facebook, Twitter, VC — Only new faces from the section CRYPT!