Elevator scheme worth over 100 million: contractors acted in the interests of “Euroformat Plant” and “Ukrlift Service”
6 April 17:59
In Kyiv, law enforcement officials are investigating a possible large-scale scheme involving the embezzlement of public funds during the renovation of elevators in residential buildings (Case No. 42025100000000034). According to investigators, the scheme involved a network of interconnected contracting companies acting in the interests of specific elevator equipment manufacturers. This is stated in a ruling by the Holosiivskyi District Court of Kyiv, reports "Komersant Ukrainian".
According to the investigation, officials of the municipal enterprise “Kyivbudrekonstruktsiya,” together with private companies, organized a scheme to inflate the cost of elevators and construction work.
The court ruling states:
“Officials of the municipal enterprise ‘Directorate for Capital Construction and Reconstruction “Kyivbudrekonstruktsiya,” acting in concert through prior collusion with officials of Unit-L LLC, Elevator Service LLC, Masterlift LLC, and Promkompleks MP… implemented an illegal scheme to embezzle budget funds during elevator reconstruction work by inflating prices for elevator supply and construction work, causing losses amounting to over 100 million UAH.”
Tenders worth over 800 million UAH
The investigation established that in 2023–2024, the municipal enterprise “Kyivbudrekonstruktsiya” conducted public procurement for elevator reconstruction totaling over 815 million UAH, which was awarded to several contractor companies.
At the same time, as noted in the court ruling, these companies were interconnected and effectively operated as a single group:
“These contracting organizations are interconnected and conduct financial and business activities with one another; they have the same counterparties and purchase elevators and related equipment from Euroformat Plant LLC and Ukrlift Service LLC, the main enterprises in whose interests these contracting organizations win public procurement contracts.”
Tenders Tailored to Specific Manufacturers
Separately, the investigation notes that the tender terms could have been tailored to specific elevators from certain manufacturers.
The ruling states:
“These public procurement tenders contain discriminatory conditions tailored to specific characteristics of elevators manufactured by Euroformat Plant LLC and UkrliftService LLC, namely: dimensions, load capacity, speed, and number of stops, which precludes the participation of other market participants.”
According to the investigation, in tenders these companies sometimes acted as a single participant or competed against each other only formally.
Double price inflation
The investigation also describes a scheme for inflating the cost of elevators. First, the manufacturer sold elevators to the contractor at an inflated price, after which the contractor sold them to the municipal enterprise at an even higher price.
The court ruling on this matter states:
“Officials of Euroformat Plant LLC intentionally inflate the prices for the sale of elevators, while Meisterlift LLC purchases the elevators at a price higher than the delivery price to Kyivbudrekonstruktsiya Municipal Enterprise,” the investigation concludes.
At the same time, according to investigators, the average market value of the elevators was significantly lower than the prices in the contracts.
Fictitious subcontractors and cash conversion
In addition to inflating the cost of equipment and work, law enforcement officials also identified the use of fictitious companies.
In particular, the court ruling states:
“Funds received by contracting organizations… were transferred to business entities with signs of fictitiousness, while using them in documentation as if they were subcontractors for elevator renovations.”
According to the investigation, funds were thus converted into cash and distributed among the participants in the scheme.
It is not known exactly what stage the criminal proceedings are currently at. The most recent court ruling in the case is dated September of last year.
To obtain information regarding the suspects, the editorial team is preparing a request to the law enforcement agencies conducting the investigation.
