29.01.2025 Money laundering

The “gray zone” of the economy or what Ukrainians’ money is spent on

Danylo Hetmantsev announced decisive actions to de-shadow the electronics market, including the import and sale of Apple equipment. However, to what extent can this initiative change the situation on the market?

According to Hetmantsev, who is the chairman of the Verkhovna Rada Committee on Finance, Taxes and Customs Policy, the “gray” electronics market in Ukraine costs the state tens of billions of hryvnias annually. And it’s not just about tax evasion, but also about illegal imports, smuggling, and the use of individual entrepreneurs’ systems as a cover for selling equipment without proper control. Among the most problematic goods are smartphones, laptops, watches and other equipment sold without proper reporting and without paying VAT.

Mr. Hetmantsev notes that the market may contain huge batches of gadgets imported illegally or under the guise of legal supplies through individual entrepreneurs. The situation is especially serious for popular brands, including Apple, where the number of purchases of equipment using cryptocurrency, in particular USDT, is increasing, which removes these transactions from official financial control.

Legalization and tax maneuvers

Individual entrepreneurs are currently the main tool for selling gray electronics, as many of them operate under the simplified taxation system, which allows them to minimize tax liabilities. However, if you think about it, it is through them that smuggled equipment is actively sold. The absence of fiscal receipts, the ability to pay with cryptocurrency, and many tax evasion schemes turn the market into a zone without responsibility for sellers. Entire chains of well-known hardware stores, including Yabko, iPeople, Avic, and others, operate under this system.

For example, Avic stores, in addition to regular cash and non-cash payments, actively use cryptocurrency to sell their goods.

Employees of Avic stores sell equipment for cash without registering transactions through cash registers or PPOs. As a result, buyers do not receive a fiscal check, and the funds remain outside the accounting records. That is, the income from the sale of equipment does not fall under the control of the State Tax Service of Ukraine, which allows them to hide a significant portion of cash receipts.

In the Avic store, customers can pay for goods with cryptocurrency through the Whitepay payment system, which allows them to make purchases through several different crypto wallets. At the same time, the funds received are also not registered in Butenko’s accounting. This allows him to hide the real sales volumes, which leads to serious losses in the state budget.

According to our estimates, the turnover of the Avic online store could reach $8,650,000 per year, and offline trade could be another $10 million. This is a large amount, and a significant part of it may be not only “gray” but also smuggled equipment that is not certified in Ukraine.

The investigation revealed that the owner of the network, Kharkiv MP Butenko, organized the purchase of equipment in Southeast Asian countries such as China, Hong Kong, and Vietnam. These were uncertified Apple and other brands, including smartphones, accessories, and household appliances, which cost much less than official suppliers.

The goods are then smuggled into Ukraine via road transport. And it is important to note that customs officers and border guards play a role in “smuggling” goods across the border.

The ruling of the Pechersk District Court in case No. 757/44112/24-k obliged representatives of the NPU’s Main Investigation Department to enter information into the URPTI and launch a pre-trial investigation. However, we have not yet received an extract, which may indicate that law enforcement is deliberately delaying the process.

How do the largest appliance retail chains Yabko and iPeople operate?

The Yabko chain consists of more than 110 stores across Ukraine, as well as a network of 150 individual entrepreneurs. Official figures show that during the war alone, the company evaded taxes worth UAH 3.3 billion.

One of the biggest problems identified by the BES was the smuggling of Apple equipment sold by the network. Instead of official imports, where VAT and customs duties must be paid, Yabko uses fictitious declaration schemes. As in the previous example, the equipment is imported from Southeast Asian countries, where the customs value of goods is significantly understated or another category of goods is indicated, which allows avoiding taxes.

The funds collected from buyers are transferred to cryptocurrency exchanges, where they are exchanged and converted into legal assets. The tax problems do not end at the customs – the proceeds are used to buy real estate, cars, and corporate rights both in Ukraine and abroad.

Based on our materials, the Chernivtsi Regional Prosecutor’s Office registered a pre-trial investigation under Part H of Art. 365 of the Criminal Code of Ukraine with the URPTI under No. 42024260000000201. At the same time, further investigation was entrusted to the State Bureau of Investigation in Khmelnytskyi.

However, despite the wave of searches and media coverage, the Yabko network continues to operate, and questions remain: why have the people involved not been brought to justice yet? Why can’t law enforcement agencies ensure transparent and effective investigations into this situation? Perhaps there are even more powerful forces behind Yabko somewhere that prevent real action?

As for the iPeople network, we have the same situation: dozens of individual entrepreneurs, smuggling, and continuous shadowing. And although the BES in Kyiv region attached our materials to the proceedings No. 72024142500000026, no real results were obtained.

So, will Hetmantsev’s initiative help to overcome the shadowing of the equipment market?

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