The SSU Counterintelligence and the National Anti-Corruption Bureau have uncovered a scheme of budget funds misappropriation at the former state-owned enterprise of Ukroboronprom concern during 2016-2019.

The SSU exposed four former officials of the defense company who stole more than UAH 107 mln (USD 2.5 mln) during the export of military products.

To carry out the fraud, the organizers involved an affiliated commercial entity with foreign registration.

Holding managerial positions, the persons involved signed agreements with the director of this entity to provide support in concluding and fulfilling contracts with Ukrainian arms exporters.

In fact, all the work with foreign customers of military products was carried out by the Ukrainian defense enterprise.

The activities of the affiliated company remained only ‘on paper’, while its accounts received budgetary funds from the state, supposedly for the mediation provided.

Later, this money was diverted to shadow through fictitious companies to be divided between the participants of the fraud.

Four former officials and the head of the affiliated company, who are hiding abroad, have been served suspicion notices in absentia under the Articles of the CCU:

• 28.3, 191.5 (misappropriation, embezzlement or seizure of property through abuse of office, committed by an organized group);
• 209.3 (laundering of the proceeds of crime, committed by an organized group);
• 28.3, 366.1 (forgery, committed by an organized group).

The suspects face up to 12 years in prison with confiscation of property.

The operation was carried out under the procedural supervision of the Specialized Anti-Corruption Prosecutor’s Office.