Half a billion in defense contracts: law enforcement exposes conversion center with fictitious companies
15 December 2025 18:09
Ukrainian law enforcement officials have announced the exposure of a large-scale conversion center, through which, according to investigators, UAH 578 million of budget funds allocated for defense contracts were laundered. This was reported by the National Police and the Office of the Prosecutor General, "Komersant Ukrainian" reports.
How the scheme worked
The investigation found that the private enterprise received funds from the budget under contracts for the repair and maintenance of military equipment of the Armed Forces of Ukraine. Instead, a significant part of the money was transferred through a conversion center to the accounts of fictitious companies.
The transfers were disguised as payments for spare parts or work, but in fact, according to the investigation, were used by the organizers of the scheme to misappropriate funds.
Where the money went
The received amounts were transferred to the accounts of shell companies, where they were withdrawn in cash and transferred to customers for a set percentage. In this way, funds were withdrawn from official circulation and legalized.
Who was behind the fictitious companies
Law enforcement officers note that the directors of the companies were citizens of Ukraine who have been living in the occupied territory of the so-called “DNR” since 2014 and, according to the investigation, support the Russian authorities and their aggression against Ukraine.
The formal founders of the companies were Polish citizens, however, as the competent authorities of the Republic of Poland found out, these persons are fictitious.
Searches and seizures
As part of the investigation, the police conducted more than 40 searches. During the investigation, they seized financial and business documents, mobile phones, electronic media, and correspondence, which, according to the investigation, details the work of the conversion group. Three premium cars were also seized.
Currently, three participants of the scheme have been served a notice of suspicion of money laundering. The article provides for up to 12 years in prison with confiscation of property.
