A State in a Smartphone without a State in Law: The Dictatorship of Algorithms

An Analysis of Draft Law No. 14005 on the Legalization of Fictitious Debt Collection for the Benefit of Monopolies

Introduction: Diagnosis of the Problem

In Ukraine, over 106.6 billion UAH in household debt for utility services has been registered. This astronomical sum, exceeding the annual budgets of key social sectors like education or healthcare, is not merely a statistical anomaly. It is an alarming and indisputable indicator of the complete disconnect between the “billing” system and the volume of services actually received. It is financial proof of a systemic collapse in contractual relations within the utility sector, where the consumer is de facto stripped of any real tools to influence the quality or even the fact of service provision, yet remains absolutely legally vulnerable to any “charges” generated by the monopolist’s billing system. This figure demonstrates a fundamental gap between the financial demands of suppliers and the real economic situation of citizens, as well as the state’s systemic inability or unwillingness to moderate these relations in favor of justice and a balance of interests.

Against this backdrop, a draft law (No. 14005) is introduced, presented to the public under the guise of necessary “digitalization” of enforcement proceedings and improvement of the collection procedure for socially sensitive debts, particularly alimony. However, an in-depth analysis of the document indicates that its true, unarticulated goal is the creation of an unprecedentedly powerful and sophisticated digital “apparatus of coercion.” This is a mechanism that operates on the principle of a “digital guillotine”: it does not investigate the substance of the “guilt” but merely automates the “punishment.” It offers no tool to verify the legality and validity of the creditor’s claims, transforming the state enforcement service into an automated tool for serving the interests of monopolies.

The draft law proposes a perfect, automated mechanism for forced collection, yet it completely ignores and, evidently, deliberately avoids addressing the key problem: the fundamental severing of the link between the “billing” and the “service actually received.” The law’s authors, like the beneficiaries of this system, are not interested in whether the services were available in the consumer’s apartment, their quality, or the implementation of transparent and accessible mechanisms for pre-trial appeals of these “billings,” as no one checks either the existence or the quality of the services. Their sole purpose is the unquestioning legalization and total automation of collecting any amount billed by the monopolist, regardless of its origin. This is the legitimization of financial coercion without establishing the fact of a legal violation.

The Positive Novella (The “Bait”)

It must be acknowledged that the draft law contains technical improvements that are positive. The key one is the proposal of Article 39-1 (“Consequences of debt repayment”).

This norm stipulates that after the full payment of a debt, the automated system of enforcement proceedings (ASEP) automatically generates a notification of repayment and, on the same day, sends it to banks and other institutions for the immediate lifting of the arrest on funds/accounts.

This genuinely solves a real, painful problem. In the existing system, a citizen, even after paying a debt, falls into “bureaucratic hell”: they are forced to spend weeks, sometimes months, personally collecting certificates, visiting enforcement services and banks to manually lift the block. For a person (not a “natural person,” as it is dehumanizingly stated in such documents), this means the inability to receive a salary or social assistance. For a small business, such a “manual” arrest, lasting for weeks after payment, paralyzes all activity and leads to bankruptcy. This bureaucratic red tape is a form of continued punishment even after the obligation has been fulfilled, which is absolutely unacceptable in a state governed by the rule of law.

However, this unconditional, yet purely technical, positive aspect looks like cynical “bait” for society and the expert community. It is a small technological concession designed to hide the far more dangerous, systemic, and anti-constitutional aspects of the draft law. It is intended to create the illusion of “fair digitalization,” which in reality changes the very philosophy of relations between the citizen, the state, and the monopolies in favor of the latter. This is a classic tactic where a minor procedural improvement is used to mask a fundamental deterioration of the legal status of millions of citizens.

The Economic Underpinnings: The Criminal “Privatization” Special Operation

The current situation is a direct consequence of a deliberate state policy, pursued for decades, aimed at creating a legal mechanism for enrichment from vital, natural monopoly resources. This policy was based on the conscious disregard for constitutional norms and the distortion of basic economic principles.

Violation of the Constitution (Art. 13 and 140-143)

The very idea of “privatizing” life-support systems is a direct violation of the fundamental norms of the Constitution of Ukraine, which define the foundations of the social order.

• Article 13 clearly states that the land, its subsoil, atmospheric air, water, and other natural resources are objects of property rights of the Ukrainian people. On behalf of the people, property rights are exercised by state authorities and local self-government bodies. This norm enshrines the inalienable right of the people to the resources that form the basis of their sovereignty and well-being.
• Articles 140-143 establish that territorial communities (TCs), directly or through local self-government bodies (councils), manage property that is in communal ownership. It is local self-government that is the right of the community to independently resolve issues of local importance, where the key issue is the management of communal property and life-support systems. This right is the foundation of the democratic order at the local level.

Life-support systems (heating plants, water utilities, power grids) are, by their nature, an integral part of communal and state property. They are natural monopolies that ensure the realization of the inalienable rights of the people (Art. 13) to life and a safe environment. Thus, the transfer of these strategic, vital assets from the ownership of the people and the management of communities into private hands (oligarchic groups) is not “privatization” in the economic sense. It is an act that bears the hallmarks of a violation of the constitutional order: it deprived the Ukrainian people of their inalienable right of ownership (Art. 13) and castrated the constitutional right of local self-government (Art. 140) to manage this property, turning local councils from representatives of the people into mere administrators acting in the interests of private monopolies.

The reform strategy ignored the basic principles of public economics, the goal of which is not to make a profit, but to provide basic public goods, human life, and the sustainable functioning of society. In Ukraine, the opposite approach was implemented:

1. Theoretical Basis: In economics, there is the classic “diamond-water paradox” (Adam Smith, Wikipedia), which explains why vital water (in conditions of abundance) is worthless, while aesthetically pleasing but non-essential diamonds are extremely expensive. This illustrates a classic market economy, where price is determined by scarcity and extraction costs.However, as modern textbooks note, in a crisis situation (e.g., in a desert), the situation changes radically. It is at this crisis point that diamonds are worthless, while water becomes priceless, and a person is willing to give all their possessions for it. This is a fundamental law of survival, which shows that the value of vital resources cannot be regulated solely by market mechanisms, as the demand for them is completely inelastic (a person cannot refuse water or heat).This is precisely why the sphere of life support is the prerogative of public economics, the goal of which is not “profit,” but guaranteeing the life and safety of citizens, and correcting “market failures.”
2. The Monopolization Plan: Ukrainian “privatization” was a criminal special operation to create an artificial “desert” and take control of the “sip of water.” Life-support systems (energy, heat, gas, water), belonging to the people (Art. 13 of the Constitution), were criminally transferred to the control of private groups. This robbery was called “privatization” to give it the appearance of a legitimate economic reform. It was a substitution of concepts that allowed for the legalization of the removal of strategic assets from public control.

Intent and Legitimization

The economists and reformers who promoted these ideas knew this theory perfectly and consciously committed this crime, creating a system of controlled resource extraction.

• Creation of “Markets”: To legitimize the boundless thirst for enrichment, laws on the so-called “gas market” and “electricity market” were adopted. In reality, these “markets” exist in name only, as their material basis—gas production, power plants, coal mines, oil refineries, pipelines, electrical grids, and other infrastructure—remains under the control of a few large players and state monopolies. These “markets” lack the main features of a market: free competition, transparent pricing, and easy entry for new players.Moreover, this material base, created by the labor of many generations, was criminally alienated from the people through non-transparent and corrupt privatization, which took place bypassing the principles of popular sovereignty and social justice.As a result, the deceived owners—the citizens of Ukraine—are today forced to buy their own former property from so-called “private” owners at some of the highest prices in Europe, paying for energy, electricity, and heat produced at enterprises that once belonged to them.Thus, the criminal privatization of strategic resources turned “market reforms” into an instrument for redistributing national wealth in favor of a narrow group of individuals, depriving the people of the right to economic sovereignty and fair participation in the state’s revenues.
• The Goal: This allowed for the impunity to raise tariffs without investing in network modernization, making the resources belonging to Ukrainians some of the most expensive in Europe. Profits were privatized, while losses and maintenance costs de facto remained on the shoulders of local budgets and the population.
• State Capture: The confidence in impunity was based on the fact that the courts and law enforcement agencies work not for the people, but for the same criminal groups that control political parties, officials, deputies, and judges. This created a closed system where captured economic power ensured political control, and political control guaranteed further economic enrichment.

Official Confirmation: Reports from Temporary Commissions of Inquiry (TCI)

The thesis of “phantom” tariffs and the criminal nature of their formation is not an assumption, but a fact, repeatedly confirmed at the highest state level.

In recent years, Temporary Commissions of Inquiry (TCIs) have been established in the Verkhovna Rada of Ukraine (in particular, by Resolution No. 4044-IX of 30.10.2024) to investigate the validity of tariffs and procurement of energy resources, including by NJSC “Naftogaz of Ukraine.”

The Transformation of NJSC “Naftogaz”: A key part of the problem was the “reform” of Naftogaz. From a state enterprise whose goal was to ensure the national interests and energy security of the people of Ukraine, it was transformed into a subject operating on the principles of private law. Its sole goal became profit maximization. Using its absolute monopoly position (control over production, transit, and storage) and its “state” company status, Naftogaz began to act like a private business, extracting money from the population through inflated tariffs, which led to the impoverishment of millions of Ukrainians.

The Mechanism of Siphoning Money through “Naftogaz”: This transformation allowed the company’s management, which acted in the interests of mafia groups that had occupied the enterprise, to legally siphon funds received from the population. This siphoning occurred in two ways:

1. Astronomical Salaries and Bonuses: While millions of Ukrainians could not pay the inflated tariffs, the top management of “Naftogaz” awarded themselves compensations that shocked society. A prime example is the case of the ex-chairman of the board, Andriy Kobolyev, whom NABU suspects of embezzling over 229 million UAH under the guise of a bonus for winning the Stockholm arbitration (case No. 991/951/23, Source: NABU). The total amount of management bonuses at that time reached $46.3 million (Source: LB.ua). This practice continued: according to declarations for 2023-2024, the salaries of Naftogaz board members reach 1.5-1.8 million UAH per month (over 21-25 million UAH per year), which is happening against the backdrop of war and general impoverishment. These funds are a direct reward to management for ensuring the interests of the occupying groups.
2. Bankruptcy of Municipal Enterprises (Heating Companies): At the same time, “Naftogaz” issued exorbitant bills to municipal heating enterprises (TKEs), driving them into a debt pit. As of 2023-2024, the debts of TKEs to “Naftogaz” reached 95-124 billion UAH (Source: DiXi Group). This led to the artificial bankruptcy of hundreds of municipal enterprises across the country, making them easy prey for further privatization or the establishment of full control.
3. Criminal Inaction: This process is a crime, as it destroys communal property and infrastructure. However, law enforcement agencies, which should protect the interests of the people of Ukraine (the owner of “Naftogaz”), instead protect the interests of the mafia that has occupied the enterprise, providing cover for the withdrawal of funds.

This model is not limited to “Naftogaz”; it is systemic for all strategic state monopolies. A striking proof of this is the situation around SE “Energoatom.” On the very day this analysis was prepared (November 10, 2025), it became known about raids conducted by NABU at the enterprise in connection with an investigation into multi-billion corruption schemes in equipment procurement. This once again proves that the colossal funds siphoned from the enterprise through corrupt deals are not spent on modernizing nuclear units or improving safety levels. Instead, these losses, as in the case of “Naftogaz,” are passed on to end consumers—the population and industry—through the mechanisms of the “market” and tariff formation, creating the very “debt” for the collection of which the repressive apparatus is being created.

The reports and public conclusions of the TCIs, despite attempts to conceal them, proved key facts:

1. Cost vs. Tariff: The cost of domestically produced gas (e.g., according to JSC “UkrGasVydobuvannya”) was several times lower (810-1023 UAH per 1000 cubic meters in 2020-2024) than the “concessional” price set for the population (7960 UAH). This 7-8 fold difference has no economic justification other than generating super-profits (Source: UNIAN).
2. Unjustified Expenses: The formation of tariffs included dubious operating costs, corrupt procurement schemes, losses from inefficient management, and billions in profits for intermediaries.
3. “Difference in Tariffs”: The tens of billions of hryvnias that the state compensated to monopolists (heating companies, Naftogaz) as a “difference in tariffs” were often simply the legalization of these unjustified expenses and corrupt schemes.

The TCI’s conclusion is simple: the 106.6 billion in debts currently hanging over the population are, for the most part, not for services actually consumed. This is a sum that includes corruption, inefficiency, and the super-profits of monopolies.

Thus, the adoption of draft law No. 14005 is a conscious act by the state aimed at legalizing and forcibly collecting the consequences of economic crimes that were officially documented by its own highest legislative body.

The Creation of the “Digital Apparatus of Coercion”

The draft law introduces a mechanism of total and automated control, turning the state into an instrument acting in favor of monopolists.

“Presumption of Guilt”: How a Service Becomes a Tax

The key implication of the law is the legal enshrinement of the “presumption of guilt” of the consumer.

• Destruction of Contractual Relations: In a civilized economy and a state governed by the rule of law, the presumption is that the service provider must prove the fact of its provision, and the consumer must pay for it. This law legitimizes the “billing” as such, regardless of whether the service was provided. The burden of proof is shifted to the citizen: now they must prove that they did not receive the service. This is a complete distortion of civil law, where both parties are equal.
• Utility Payment as a Tax: This effectively turns a utility payment from a contractual payment for a service into an unconditional tax or tribute. The consumer is obliged to pay based on the “billing,” and then, if they have the financial and time resources, spend years in court proving that they did not receive the service or received it inadequately. This makes the citizen a serf to the monopoly.
• The “Court Order” Mechanism: This system works perfectly in tandem with the simplified court order procedure. The monopolist does not need to initiate a full-fledged lawsuit and prove in court the fact of service provision—it is enough to provide its “billings.” The order is issued by a judge unilaterally, without summoning the consumer. The system is deliberately designed so that most people (those not living at their registered address, serving in the Armed Forces, being IDPs, or simply not checking their mail) will miss the 15-day deadline to cancel the order. As soon as the deadline is missed, the person automatically, without trial or investigation, enters the Register of Debtors. This procedure is not justice, but a legalized form of administrative reprisal, depriving the citizen of the basic right to defense.

The Instant Blockade Mechanism: “Social Shutdown”

The foundation of the system is the Unified Register of Debtors, which is transformed into an instrument of “social shutdown.” Being included in it—even due to an error or a fake court order—leads to immediate and devastating consequences:

1. Property Blockade: Automatic refusal by the Ministry of Internal Affairs to re-register a vehicle. This is not just a ban on selling; it is the deprivation of the right to dispose of one’s property.
2. Real Estate Blockade: Automatic refusal by notaries to certify any transactions (sale, gift, mortgage). This effectively “freezes” all of a person’s assets.
3. Financial Control: The obligation of banks to immediately inform enforcers about the opening of new accounts for their instant arrest. This ensures that not a single hryvnia bypasses the collection system.

This is not just an “inconvenience.” It is a cascading effect: the inability to sell a car may mean the inability to conduct business or obtain funds for medical treatment; the arrest of accounts blocks all economic activity. It is an effective tool for excluding a person from social life. Blocking the salary card of a serviceman at the front line due to a fictitious utility debt, leaves his family without means of subsistence—this is a direct threat to national security.

“Dictatorship of Algorithms”: The Danger of the “State in a Smartphone”

This is the real goal of the “state in a smartphone” concept in its current implementation—not a service for the citizen, but a system of total control and automatic punishment. It is a dictatorship of the algorithm, where there is no place for the presumption of innocence, human dignity, or the right to defense. It is a system that allows any person to be excluded from social and economic life at the push of a button, turning basic rights into privileges dependent on loyalty to the “billing” system. It is an instrument of digital totalitarianism, disguised as a convenient service.

Beneficiaries of the System: Not Just Oligarchs

Although the main beneficiaries are the financial-industrial groups controlling the monopolies, the law (No. 14005) is being promoted under the cynical cover of protecting children.

The “Trojan Horse” of Alimony

The collection of alimony is a socially approved, absolutely necessary goal. This noble objective is deliberately brought to the forefront to gain public approval. However, it is used as a “Trojan horse” to “sell” society a repressive mechanism that will be used for a completely different purpose—to collect utility debts, the share of which in the overall structure is incomparably larger.

However, in conditions of war, mobilization, and economic crisis, many men are objectively unable to fulfill their obligations (loss of job, injury, being in captivity). The system does not check each case but only automatically punishes, destroying social ties and driving people into a corner. Such an attitude towards people, especially those defending the country, has already led to a catastrophic population decline in Ukraine. Instead of helping families, the state offers a punitive mechanism.

Private Enforcers: The Commercial Army of Monopolies

The law strengthens the role of commercially motivated private enforcers. Their remuneration is a percentage of the amount collected. They are financially interested not in establishing justice, but in collecting the largest and easiest debts, which are the “billings” of monopolists confirmed by court orders. They are transformed into a de facto private army of the monopolies, using the state’s “apparatus of coercion” for their own enrichment. This system creates a dangerous market for “debt trading,” where private structures receive the legal right to financially terrorize the population with the support of state instruments.

The Practice of Today: Lynch Law and Police Complicity

The mechanisms that the draft law legalizes are already being used by monopolists, but for now, in a criminal way. The examples provided demonstrate the complete fusion of monopolies and security forces, which creates an atmosphere of total impunity.

Case 1: The “Fake Debt” (Kyivteploenergo)

“Kyivteploenergo” billed a Kyiv resident 50,000 UAH for hot water. The absurdity of the situation is that the building has not had this service for 20 years, following DTEK’s intervention in the boiler room. Complaints have been ignored for years. This case is not an error, but a systemic feature of automated billing systems that generate profit “out of thin air” and have no feedback loop with the consumer. Under the new law, this fictitious debt, backed by a court order, will turn into an automatic arrest of property and accounts. This illustrates how digitalization without justice becomes an instrument of terror.

Case 2: DTEK/YASNO Lynch Law and Procedural Sabotage

This case demonstrates the full hierarchy of the criminal system: from the field enforcers of the monopolies to collectors and police cover.

The Crime: Lynch Law and Violation of Habitation Inviolability

Employees of DTEK (the grid operator), instead of going to court and providing evidence of the debt in an adversarial process, began to openly engage in criminal activity. Acting without any permission from the victim or a court order, company employees repeatedly entered the private property of a Kyiv resident and cut the wires.

They justified their criminal actions by citing an alleged old, disputed debt that arose before 2019, when the contract was still with DTEK, even though at the time of entry, the contractual relationship for supply was with a different legal entity—YASNO. This is a direct violation of Art. 162 of the Criminal Code of Ukraine (Violation of the inviolability of habitation) and classic arbitrary action (Art. 356 CC). This is a demonstration that the monopolist, feeling its impunity, places itself above the court and the law.

Terror: Illegal Transfer of Data to Collectors

Subsequently, DTEK/YASNO transferred the family’s personal data (which is a violation of the Law “On Personal Data Protection”) to the collection company “Delta M Ukraine,” which began psychological terror and extortion (Art. 189, 355 CC). This indicates the use of the entire arsenal of illegal pressure methods, where collectors act as the strong arm of the monopolist.

Complicity of Law Enforcement

The victim appealed to the Holosiivskyi Police Department (Head: A. H. Kochkadamian). However, the police, ignoring Art. 214 of the Criminal Procedure Code (CPC) of Ukraine (the obligation to immediately, within 24 hours, enter information into the Unified Register of Pre-trial Investigations) and even direct court orders that obliged the police to start a pre-trial investigation, refused to stop the criminal activities of DTEK and the collectors.

• Legal Qualification: Such systematic, conscious inaction by the police bears the hallmarks not just of official negligence (Art. 367 CC), but of complicity in a crime (extortion, violation of habitation inviolability) and failure to execute a court decision (Art. 382 CC). This demonstrates a complete fusion of the monopolist with the law enforcement system and sends a signal of absolute impunity. It is proof that law enforcement agencies are openly protecting the interests of the mafia, not the citizens.
• Procedural Sabotage: The police did not just ignore the complaints. They resorted to open procedural sabotage: the victim repeatedly requested to be questioned as a victim and to be provided with the case materials for review, but the police ignored all requests and eventually illegally closed the criminal case, refusing to provide the victim with the closure decree. This is direct destruction of evidence and the preclusion of justice.
• Systemic Practice: This case is not isolated. A similar practice of sabotaging criminal proceedings against monopolists is also recorded in other police departments in Kyiv, particularly in the Pecherskyi district. This indicates that this is not an error or negligence of individual officers, but a systemic, coordinated activity of the law enforcement vertical, aimed at covering up the crimes of mafia groups.

Conclusions: Converting “Billings” into Real Money

Draft law No. 14005 is the final element of a system whose goal is the forced conversion of “phantom” debts into real assets.

The Motive: “Why Now?”

This law is an instrument for the emergency conversion of fictitious assets (doubtful debts) into real money. In the context of economic crisis and war, the cash flows of monopolists are drying up. They need this law right now to legalize their “billings” of 106 billion. This will allow them to “clean up” their balance sheets, either to collect from the people or (more likely) to force the state to cover these “debts” from the budget. They also seek to present themselves to international partners and investors (in the context of recovery programs) as “effective businesses” suffering from “non-payers,” thereby demanding financing to cover the very debts they themselves created.

“The Great Racket”

Conditions are being created where it is cheaper and easier for a person listed in the Register (regardless of whether they are a real debtor) to pay a fake debt than to enter into a long, expensive, and predetermined-to-fail fight against a system where the monopolist, collector, enforcer, and law enforcement act as a single entity.

This launches “the great racket,” where the end result is one: the oligarchs get real money. There are two paths:

1. Path 1 (Direct): Citizens, driven to despair by pressure (property blockade, collector terror, and police complicity), pay dubious bills to regain the ability to exist. This is a direct expropriation of the population’s last savings.
2. Path 2 (State): The state, saving strategic monopolists from bankruptcy due to “population debts,” covers these amounts from the state budget—that is, at the expense of the same people, but through taxes. This money is withdrawn at the expense of underfunding education, medicine, and defense. This is a direct siphoning of money from demography, knowledge, and the education of future generations, which literally destroys Ukraine’s future and its defense capability, as funds that could have gone to drones are diverted into the pockets of monopolists.

The Alternative Path: Genuine Reform for the Benefit of Citizens

Philosophy: From “Wallet” to “Highest Value”

The proposed draft law is the antithesis of Article 3 of the Constitution of Ukraine, where “The human being, his or her life and health, honour and dignity, inviolability and security are recognised in Ukraine as the highest social value.” This law turns the human being from the highest value into a “wallet” for mafia groups, and the state into an apparatus of coercion for their benefit.

True reform must be based on the “presumption of consumer innocence” and a complete restructuring of the system, aiming not at extracting money, but at ensuring life. This model completely negates the need for a repressive law, as it eliminates the very cause of “fictitious debts.”

Step 1: Confiscation and Return

The full confiscation and return to communal (local communities) and state ownership of all strategic life-support infrastructure (electricity, gas, water, heat), which was illegally “privatized” in defiance of Art. 13 (“Property of the Ukrainian people”) and 140-143 (“Local Self-Government”) of the Constitution of Ukraine. This is not re-privatization, but the restoration of the constitutional order.

Step 2: Creation of the “Public Monopolist”

The creation at the level of each Territorial Community (TC) of a single economic entity of public law (e.g., SEPL-BE Territorial Community), controlled by the members of the community (in accordance with Art. 140-143 of the Constitution). This entity must manage the entire life-support system, where the goal is not profit, but the sustainable provision of services at an economically justified cost.

Step 3: Three-Tier Control (CSA-Council-Entity)

The introduction of a three-tier system for monitoring the quality and volume of services, which simultaneously provides social assistance to those in need.

• Tier 1 (Building/Street): Building and neighborhood Community Self-Organization Bodies (CSAs) receive real powers to monitor the actual provision of services (availability, quality, pressure, temperature), as well as to identify those in need (single elderly, persons with disabilities), forming requests for social assistance.
  • Instrument: In case of non-provision or poor quality of service (cold radiators, no water), the CSA, as a legitimate representative of the residents, draws up a collective “Claim Act.”
  • Legal Force: This act is a legal document that records the fact of non-provision of service and is mandatory for acceptance and review. It has the status of a primary accounting document that suspends billing until the dispute is resolved. This is an immediate response tool that breaks the “pay first, complain later” scheme.
• Tier 2 (Community): The CSA, together with the local council (TC), resolves the issue of the quality and quantity of services actually received.
  • Mechanism: The TC Council validates (checks and approves) the “Claim Acts” from the CSAs.
  • Function: A register of “Claim Acts,” formed and confirmed by the TC Council, serves as the legal basis for an automatic recalculation for all residents covered by this act. This relieves citizens of the need to individually sue the monopolist.
• Tier 3 (Entity): Payment to the economic entity is made only on the basis of confirmed acts of actually provided services, not abstract “billings.”
  • Consequence: The single economic entity legally has no right to issue “billings” for services that have been disputed via a “Claim Act” confirmed by the TC Council, until the dispute is resolved. This shifts the burden of proof from the citizen back to the service provider, restoring constitutional rights.

Step 4: Effective Management (Feedback)

The system of “Claim Acts” from CSAs becomes not only a control mechanism but also invaluable managerial information. Real-time analysis of these acts (e.g., “50 acts about cold radiators from the ‘Sonyachnyi’ neighborhood”) allows the TC Council to see exactly where systemic problems are occurring in the infrastructure (pipe breaks, network wear, power outages) and to make timely decisions about necessary repairs and investments in infrastructure modernization, without waiting for a collapse. This transforms the system from punitive to managerial, creating a living feedback loop between the consumer and the service producer.

GENERAL CONCLUSION: DIAGNOSIS OF THE SYSTEM

Thus, a comprehensive system of controlled resource extraction has been formed and is being legally cemented in Ukraine, which has all the hallmarks of an organized criminal group that has seized state power. This conclusion is based on the analysis of consistent, systemic, and interconnected actions aimed at achieving a single goal—the redistribution of national wealth.

This system operates in stages, with each stage logically following from the previous one:

1. Stage 1: Illegal Privatization (Asset Seizure). In defiance of direct constitutional norms (Art. 13, 140), strategic assets and natural monopolies (energy, gas, heat), which are the property of the Ukrainian people, were transferred to the control of private groups.
2. Stage 2: Systemic Enrichment (Legalization of Robbery). Through the adoption of laws on “markets,” the creation of criminal regulators (like the NERC, which legitimizes any whim of the mafia), and price manipulation, criminally inflated and economically unjustified tariffs were established. This is confirmed by official reports from Verkhovna Rada TCIs, which recorded a colossal difference between the cost of resources and the price for the population.
3. Stage 3: Economic Sabotage (Consequences). This policy led to the destruction of industrial potential and the impoverishment of the population, as exorbitant tariffs drained working capital from the real sector of the economy and households, especially during the critical period of war and economic crisis.
4. Stage 4: Creation of the Apparatus of Coercion (Cementing the System). Draft law No. 14005 is a key element of this stage. Its goal is to create, through “pocket” deputies, a perfect, automated state mechanism for the forced extraction of money and property, legalizing the collection of fictitious, “phantom” debts.
5. Stage 5: Capture of Law Enforcement and Judicial Structures (Guarantee of Impunity). To ensure the functioning of this scheme, control over the law enforcement and judicial branches of power was established. As “Case 2” demonstrates, security forces are used to cover up the crimes of monopolies (lynch law, violation of habitation inviolability) and terror against citizens, while the judicial branch legitimizes this process by denying justice and ensuring complete impunity for the criminals.

This model of state capture is not unique; it is, in fact, the second, more technological stage of the process that began in the 1990s. In the first stage, the instrument was an artificially created economic crisis (hyperinflation, industrial collapse), which allowed for the fraudulent seizure of material assets—the property of the Ukrainian people—and, consequently, political power, through non-transparent “voucher” privatization.

In the current, second stage, the toolkit has changed. Instead of the chaotic seizure of assets, there is now a systematized extraction of financial flows from the population through mechanisms of “billing” that are legalized (like draft law No. 14005) but criminal in substance.

However, there is a fundamental difference that makes the current situation incomparably more dangerous. Whereas in the 90s, having seized property (factories, infrastructure), the “old” oligarchs were forced to at least somehow maintain their viability for their own enrichment, the current model of “siphoning” finances is purely exploitative. It does not provide for reinvestment. This suggests that after the final withdrawal of capital and the inevitable collapse of the system, which the war will accelerate, the beneficiaries of this scheme (oligarchs, officials, deputies) will simply leave the country, leaving behind only ruins and countless debts.

To ensure the long-term viability of this scheme and to cover up its criminal nature, an ideological capture of the education system took place in parallel with the economic capture. The introduction into educational programs of false (and essentially criminal) neoliberal doctrines, which fetishized “private property” and the “free market” while simultaneously silencing the constitutional norms about the property of the Ukrainian people (Art. 13) and the essence of public economics, led to catastrophic consequences. A whole generation has grown up that does not understand the fatal consequences of these “reforms.” Despite the objective deterioration of the economy and quality of life, these young people often continue to assert the “effectiveness” of privatization and “markets,” because they simply know no other model of the world and have not been taught to critically evaluate reality outside the imposed doctrine.

Today’s NABU raids on “Energoatom,” just like the past cases against “Naftogaz” management, are merely fighting the consequences, not the cause. These are “fables about success in the fight against corruption,” a fight that no one ever really waged, because corruption does not need to be “overcome”—it needs to not be created.

The source of corruption is the very laws and regulations that allow public property (Art. 13 of the Constitution) to be managed for private interests and to control “cash flows” instead of the “cost of the good” for the people. Without changing this paradigm, new “overseers” and thieves will inevitably replace the old ones.

In aggregate, this is not a chaotic “failure of reforms,” but a purposeful, open robbery of Ukrainians, carried out through formally legalized, but criminally substantive, mechanisms.

The country faces an existential choice: either the Ukrainian people will reclaim their power and property in accordance with the Constitution, or soon nothing will be left of Ukraine.