In June 2024, Viktor Smal, the head of the State Forest Resources Agency, declared the end to the popular scheme of concealing illegal clearances. This end was to come thanks to obligatory photofixation of the cut timber. Now, even chopped wood can be transported only after the specialists of forestries enter detailed information about the cargo into a special system and add photos of the vehicle, loaded with wood, taken from different angles.
“Previously, some fraudsters among enterprise employees could forge tags and transport several cargoes of wood using one CN [consignment note, TTN in Ukrainian]. It is rather difficult to detect forgery while checking the vehicle on the road because, from a formal standpoint, the driver has all the documents. Now, the photographs of the loaded timber are taken from four angles. Only then will the CN be executed,” Viktor Smal explained. “The picture of the loaded timber is unique; it is impossible to repeat it. Thus, the CN cannot be used for the second time. It ensures the additional mechanism of control over timber transportation for the law enforcement bodies and the public because one can make a picture and check the information without even leaving one’s car.”
This idea has been tested in the forestries of the State Forest Resources Agency, covering 73% of Ukraine’s forests, for seven months. In June, the photofixation became obligatory for all forest users, including municipal forests, as well as the forests of the Ministry of Defence, the Ministry of Environment Protection, and the National Academy of Agrarian Sciences of Ukraine.
This approach to controlling clearances is actually not novel. The SUMAL system in Romania has been working under a similar scheme for several years now and is considered one of the most complicated control systems in Europe. However, the joint investigation of OCCRP and RISE Romania has demonstrated that even this system was fooled by Romanian foresters who loaded random pictures of their dinner tables and continued their fraud in the timber market without any obstacles.
NGL.media analyzed over 57 thousand consignment notes and over 72 thousand pictures of the vehicles, loaded with timber, and found out that Ukrainian foresters also quickly found a way to bypass the system.
One device for the entire forestry
To see how the system works in practice, we went to the forestry in the Lviv region. This small enterprise We don’t publish the name of the enterprise because its employees agreed to give us this excursion only on condition of anonymity releases from two to five vehicles with timber every day. For instance, to buy some firewood, you contact their office, leave your contact data, and specify the desired volume of firewood.
“When we have a sufficient number of cubic meters, we get in touch with the buyer and tell them that it is ready. We don’t deliver the wood, so the buyers look for vehicles on their own,” the forestry explains.
We were shown the dispatch procedure. First, timber is gathered up in the forest. It is the grouped logs that are used to attach a plastic tag with a special hammer; the tag has a bar code and a unique set of figures that can be checked online. The tag contains the ciphered information about the species and variety of timber, its volume, and the forest user. Once the tag has been registered, it cannot be used for the second time. However, at the risk of jumping rather ahead, we shall say that in dozens of consignment notes that we have reviewed, we have seen that the tag was intentionally not nailed but photographed on one’s knee.
“A vehicle cannot move out without a consignment note — this is the main document without which a driver transports timber illegally. If a driver is stopped by the police, he has to show the CN,” the forestry told us.
To print the CN, a forestry employee with a special phone (pocket-size computer) and a pocket-size printer has to come to the place. These devices are given by the State Forest Resources Agency to all the users of the ERT system. A specialist enters the data of the vehicle and tags, takes pictures, and prints the CN. Noteworthy is the fact that it is impossible to load the image from the phone library — each picture has to be taken immediately after loading the vehicle before executing the CN. The system allows to re-take a poor picture and only after a forester takes all four pictures and confirms their accuracy, the information is sent to the ERT (so the possibility of accidental loading of problematic pictures is ruled out).
Viktor Smal, the head of the State Forest Resources Agency, highlighted in public several times that anyone can check the information about transportation. “The information about the consignment note is open. Anyone can find a specific consignment note on the website of “Forestry Innovative Analytic Centre” (FIAC) using the number of the document or the licence plate of the vehicle,” Viktor Smal declared.
Yet it turned out that it is practically impossible to get the list of consignment notes. Since August 2024, we have got in touch with the State Forest Resources Agency, SE “Lisy Ukrayiny” [Forests of Ukraine], and SE “FIAC” with the request to provide us with all the CNs, issued in 14 days, so that we could check whether they load the pictures and how efficient this instrument is. According to the Resolution of the Cabinet of Ministers, 14 days is the period for storing the pictures in the system, then they are deleted. We have made over 10 inquiries to all the regional forestry offices of SE “Lisy Ukrayiny” but only the Carpathian Forestry Office has sent us the CNs.
We managed to get all the consignment notes from the “FIAC” thanks to the inquiry, made by Natalia Pipa, a people’s deputy who has kindly agreed to help us.
“You will say that it is wrong, but I will tell you as it is”
In the second half of September, we received the list of all the consignment notes used to transport timber for two weeks. There were over 57 thousand CNs though not all of them contained pictures (the images are automatically deleted from the servers after two weeks of storing). The analysis of the CNs containing pictures confirmed our hypothesis that the system has a large potential field for fraud.
According to the data of the State Forestry Resources Centre, the index of pictures, accurately loaded to the system, is 93–95%. In general, our analysis confirms the following conclusions: in the first two weeks of September, we found 369 documents with fake pictures or closed screens, which is about 2% of those CNs that contained pictures at the time. However, this percentage varies considerably for different forest users, reaching 50% of all the CNs for some.
We have found a number of schemes to bypass the photofixation function of the State Forest Resource Agency and to execute the CN. For instance, one can take a picture from another screen, close the camera with a finger, or take a picture of quite another object. In this case, the system doesn’t block the execution of the consignment note, and the users receive a document that makes timber transportation legal.
Pictures with the CN issued by the Koropskyi specialized forestry enterprise “Ahrolishosp”. Pictures 1 and 2 have a closed screen, and pictures 3–8 have flashes, which prove that the operator took a picture of a photo from the computer screen instead of photographing an actual vehicle.
For instance, in the Koropskyi specialized forestry enterprise “Ahrolishosp” in the Chernihiv region, they confessed at once that they do not have time to attend each loading, so they execute the consignment notes in the office ahead of time.
“You will say that it is wrong, but I will tell you as it is. We have a limited number of pocket-size computers, so in the morning, we have to form consignment notes for the places we cannot attend to personally. We close the camera with a finger and print the document. Sometimes we take a picture of the computer screen,” Artem Artiomov, the administrator of electronic timber registration, told NGL.media.
Pictures from the CN issued by “Halsillis” municipal enterprise: non-informative pictures (1-4, 6), a picture of a screen (5), and a closed camera (7, 8)
In the municipal forestry enterprise “Halsillis” in the Lviv region, we found out that half (11 out of 22) of the check-outs during the period, analyzed by us, were also consignment notes with pictures, in which the camera was completely closed with a finger.
“The phone (pocket-sized computer) was broken, and the loading was done every day; I had no chance to give it for repair. It was hit, and it showed on the screen whatever it wanted — the entire colour spectrum,” Mykhailo Oleksiuk, the head of the Stryi affiliated forestry enterprise “Halsillis”, explained to us.
We found the pictures of the computer screens, the images of office linoleum, and the ones with the camera closed with a finger in the consignment notes of the “Volyn military forestry” as well. However, they believe that it happened due to “poor Internet connection”.
“Our enterprise is specialized; it takes timber in shooting ranges, where there is almost no connection. We will organize a meeting to have everything clear in this regard. But there is no violation of law here. We do not have any intentional violations here or illegal timber at all,” Viktor Barchuk, the head of SE “Volynskyi military forestry”, told us.
A picture from the CN issued by the “Volynskyi military forestry”. The camera is closed in all the images.
It should be noted that it is impossible to execute the CN without an Internet connection; the forestry representative has to load the pictures into the system, and only then will the CN be allowed for printing, so the version about the absence of an Internet connection is doubtful.
In the municipal SE “Olevskyi forestry of APK” in the Zhytomyr region, we also found many cases of improper use — 32 out of their 213 consignment notes contained non-informative pictures of the screen where one can even see the menu of the phone. In the words of Vitalii Iskra, the engineer in the computer application of the SE “Olevskyi forestry of APK”, they will surely check all these cases of improper use and punish the guilty employees by cutting their bonuses.
“It might have happened because older specialists work for us,” Vitalii Iskra assumed.
We have seen the pictures of horses from different angles in dozens of consignment notes. This, it should be mentioned, is not a violation because timber could have been transported by horses. The only question is: How informative is it when loaded into the system?
Our review has also demonstrated that the forestries of the State Forest Resources Agency are actually more diligent in loading pictures compared to municipal forestries and the ones, subordinate to the Ministry of Defence. However, they couldn’t do without tricks either. For instance, in “Verkhovynsk forestry”, we found seven CNs containing a picture of the screen instead of actual timber-transporting vehicles. In one of these consignment notes, we also noticed that the time of execution was 19:41 while on that day, the sunset was registered at 19:30. One can clearly see a bright day in the picture. We have found a total of 36 CNs with incorrect images issued by the enterprises of the State Forest Resources Agency.
The image from the CNs of the “Verkhovynsk forestry”. Flashes are seen in both pictures, which proves taking a photo of the screen.
“And why should the State Forest Resources Agency deal with it?”
In this situation, we were most surprised that there is no punishment for fraud with pictures. In the State Forest Resources Agency, they told us straight away that they do not control all the users.
“And why should the State Forest Resources Agency deal with it? We have done it [the system of Electronic registration of timber] so that everyone could check the transporters, including the public. Enter the system and check. We control the enterprises which are subordinate to us, we have no power regarding others. There are other competent bodies, including law enforcement agencies to deal with it,” Ruslan Krykun, the head of the department of forest resources use and technical policy of the State Forest Resources Agency, explained in a phone conversation with NGL.media.
The system of electronic registration of timber itself is administered by SE “Forestry Innovative-Analytical Centre”, subordinate to the State Forest Resources Agency.
Artur Kosmach, the deputy director general of SE “FIAC” surprised us with his comment that “they do not have the obligation to check every picture”.
It should be noted that there is an official manual, which clearly states what should be photographed. There should be four pictures: the front (the driver’s cabin and the licence plate), the side (the entire vehicle and the trailer), the back (the body of the vehicle or trailer, assortments, and numbers), a close-up view of the class of timber quality.
The manual on the website of the State Forest Resources Agency with a detailed description of what should be photographed
Even though this manual is on the website of the State Forest Resources Agency, Artur Kosmach believes that it is not a regulatory document, so it is not obligatory to comply with it.
“No regulatory document states which pictures should be made. There are only recommendations. If they are not followed, only administrative measures can be taken. If something is not shot accurately, there is no violation in it,” the official thinks.
When asked how efficient the system can be if it envisages neither precise requirements regarding the loaded pictures nor any punishment for incorrect pictures, the official answered philosophically.
“Well, it is obligatory to have everything written superbly. If it is obvious that there is something wrong, then why should there be any additional recommendations. The police do see that the CN contains no picture or that the pictures do not correspond to the visual examination of the vehicle. I see it this way. I am not saying that the system is imperfect, I am saying that there is nothing perfect,” Artur Kosmach believes.
We also asked the deputy head of “FIAC” whether they had adopted the best practices of other countries while developing the system of timber registration. But the answer was unexpected too.
“There is no similar system. We have a system, controlling forest users the most. A declarative principle works in Europe; you’d be surprised how more liberal everything is there. There are no documents or consignment notes. For instance, in Germany, they just come by car and sign a paper; nobody enters anything into any electronic system,” Artur Kosmach said.
The cost of the system
After receiving the official position of the “FIAC” that fake pictures do not constitute a violation, we decided to find out how much money was spent on the introduction and support (improvement) of the “photofixation” function.
The response to the inquiry of NGL.media shows that UAH 93 thousand was spent to do it. At the same time, when we analyzed the procurement on Prozorro online platform, it turned out that only in 2024, the “FIAC” has ordered services to improve this function for over three million hryvnia. So, we sent another inquiry: How did they calculate it? In the new response, the officials “have found” the spent millions and confirmed that they actually had had biddings and procurements for the amount of UAH 3.189 million to improve the “photofixation” function using AI. They also added that the investment into artificial intelligence will result in considerable savings from the salary fund of the enterprise since 10 employees of the “FIAC” are dealing with the analysis at the moment. It is just surprising that a week before this response from the State Forest Resources Agency, Artur Kosmach, the deputy director general of SE “FIAC” said that nobody was checking the pictures at that moment.
“10 to 15 people were involved in checking the pictures while testing this function; it was before we started using artificial intelligence. As far as I know, that was a process; these people were gradually dismissed,” Kosmach said.
The samples of incorrect pictures, loaded to the ERT system. The pictures of the screens (1, 3, 8), tags are not attached (4, 7, 15), non-informative images (2, 5-6, 9-14)
12 biddings of the “FIAC”, aimed to improve the photofixation system using AI, were won by “IT-Mendos” LLC, which, judging by the laconic website (without any contact phone number and samples of their work) deals with support, maintenance, and improvement of websites. Unfortunately, we failed to get in touch with the company representatives; they didn’t respond to our phone calls.
Artur Kosmach didn’t give a straight answer to our questions about AI actually working at the moment, explaining it by the fact that another department is responsible for it and he “cannot say which one exactly”. So, we decided to check the CNs loaded in November to check whether the system still accepts any images. In the picture of the municipal “Ahrolishosp” from the Chernihiv region, we saw the same flashes from the computer screen, and in the consignment notes issued by the “Volynskyi military forestry”, there were the same black images, made with the closed camera.
Noteworthy is the fact that in September 2024, there was an announcement about the plans of the State Forest Resources Agency to develop a new platform for timber registration, “ERT 2.0”.
“The forestry branch received about USD 5 million of international financing for digitalization. These finances are already being used to start the elaboration of the new generation system of timber registration and the System of electronic declaration of transactions with timber,” the official website of the State Forest Resources Agency declared.
One of the arguments in favour of updating the system has become the illegal intrusion into the work of the system by officials having access to it. It is yet unknown who exactly changed the data in the ERT and how it was changed, but the “FIAC” is conducting an official internal investigation into this fact. The information was also submitted to the law enforcement bodies. The State Forest Resources Agency and SE “Lisy Ukrayiny” pledged maximal support for this investigation. We have sent an official inquiry with the request to provide us with the details of this violation, but despite the promise to support the investigation, the State Forest Resources Agency refused to give any details.
Iryna Hruzinska, the head of “Agriculture” sector of the Better Regulation Delivery Office (BRDO) The Office was established in 2015 as a non-governmental, non-profit organization to assist the government in mid- and long-term economic reforms to improve business environment under political instability confirmed for NGL that within the framework of the project “Digital Transformation Activity” (DTA), they work at the elaboration of the “ERT 2.0” system. The expert explained that at present, the ERT has several problems, one of them being it still works with the russian software for accountancy, “1S: Enterprise”.
“Our task is to ensure that a new system is protected and contains all the services, including permits, and clear control over all the stages of timber movement. At present, the system consists of 28 modules, and these are too many. So it will not happen so that in one moment the old system switches off, and the new system starts working. We will do it gradually,” Iryna Hruzinska explained.
The cost of the new system is not known yet; at first, the Better Regulation Delivery Office will develop the technical requirements for the platform, and then they will look for vendors using open bidding at the platform of public procurements, Prozorro. The project “Digital Transformation Activity” is intended to work until 2029, by which time “ERT 2.0” has to start working.