The National Anti-Corruption Bureau, the Specialized Anti-Corruption Prosecutor’s Office and the Security Service of Ukraine, based on the State Audit Service’s conclusions, have served notices of suspicion to a former member of parliament, his business partner and four of their accomplices.

They are suspected of embezzling and selling 97,000 tons of state-confiscated oil products, which were intended for the needs of the armed forces.

The State Audit Service of Ukraine found that the state budget suffered losses of almost UAH 1 billion (USD 26.2 million) as a result of these transactions, which took place in 2014-2017.

The perpetrators are suspected under Articles 191 and 255 of the Criminal Code of Ukraine.

In 2014, the state confiscated almost 100,000 tons of oil products from the entities of Serhiy Kurchenko, a Yanukovych-era oligarch who fled from Ukraine to russia. Investigators found that with the help of the former MP’s political lobby, these oil products were transferred to a specialized state-owned enterprise to be sold to fill the state budget. At the time, this entity was run by executives controlled by the ex-MP’s business partner.

On the instructions of the suspects in this case, officials of this state company facilitated the sale of almost 100,000 tons of oil products at significantly reduced prices to a group of companies owned by the former MP’s business partner.

These oil products were then sold at petrol stations belonging to this group and other network petrol stations, while the proceeds were concentrated among the beneficiaries of the scheme.

To create an appearance that the confiscated oil products had been transferred to the Ministry of Defence, the state-owned enterprise made deliveries, for which the MoD paid in full. However, the MoD received only 1.6% of the so-called Kurchenko’s oil products. The rest were oil products purchased from the same group of companies, which, in turn, purchased them from russia and belarus. At the same time, the suspects sold the same range of goods to their group of companies at half the price paid to the AFU.

According to the investigation, the former member of the Ukrainian parliament provided political cover for these transactions by using his influence and administrative resources over state-owned enterprises, judicial and law enforcement agencies that confiscated these oil products.

In 2020, the court ordered a special confiscation of these oil products and the proceeds from their sale for the benefit of the state. However, according to the investigation, the entire volume of oil products and all the proceeds from their sale had already been embezzled by the members of the criminal organization, and the state budget suffered losses of at least UAH 967 million.

The investigation is ongoing. The suspects face up to 12 years in prison.