A scheme worth 7 million hryvnia: million-dollar fraud uncovered at a defense plant in Kyiv
25 February 05:11
In Kyiv, detectives from the Economic Security Bureau of Ukraine exposed an official of a state-owned defense industry enterprise who organized the purchase of industrial equipment at significantly inflated prices. According to the investigation, the state suffered losses of almost 7 million hryvnias. This was reported by the press service of the ESB, according to "Komersant Ukrainian".
How the scheme worked
The investigation established that one of the managers of the state-owned enterprise took advantage of the urgent need to replace parts of a shaft furnace, which was in disrepair as early as 2021.
According to law enforcement, the official organized the formation of an artificially inflated expected purchase price. To do this, he involved controlled companies that provided “competitive” commercial offers with almost identical but significantly inflated prices.
It was on the basis of these documents that the expected purchase price was formed.
The company then conducted the procedure through the Prozorro electronic system and signed a contract with the company that offered the “lowest” price among the bids submitted. After that, the funds were transferred to the supplier in full.
Losses of 7 million hryvnias
An expert examination showed that the actual market value of the equipment was significantly lower. The difference between the amount actually paid and the market price is about UAH 7 million.
Thus, the state-owned defense sector enterprise suffered particularly large losses.
Classification of the crime
The official’s actions were classified under Part 5 of Article 191 of the Criminal Code of Ukraine — embezzlement of property through abuse of official position, committed by prior conspiracy by a group of persons and on an especially large scale.
The article provides for imprisonment for up to 12 years with confiscation of property and a ban on holding certain positions.
Investigative actions are currently underway to identify all persons involved and recover the losses caused to the state.
