From factories to real estate in the UAE: how the State Property Fund’s money laundering scheme worked
20 February 06:26
The National Anti-Corruption Bureau of Ukraine (NABU) and the Specialized Anti-Corruption Prosecutor’s Office (SAPO) have reported new suspicions in a high-profile corruption case involving the State Property Fund of Ukraine. Four individuals are suspected of laundering more than UAH 300 million obtained through criminal means. Foreign assets, including real estate in the United Arab Emirates and Croatia, were used to conceal the origin of the funds. This was reported by the press service of the National Anti-Corruption Bureau of Ukraine, according to "Komersant Ukrainian".
What are the suspects in the State Property Fund case suspected of?
According to the investigation, the new suspects were members of a criminal organization headed by the former head of the State Property Fund of Ukraine.
They are suspected of:
- legalizing property obtained by criminal means;
- laundering of corrupt income;
- using international financial schemes to conceal assets.
Law enforcement agencies identified the new participants in the scheme thanks to cooperation with law enforcement agencies in several European countries.
What property was purchased with corrupt funds
According to NABU, the suspects set up companies abroad to launder corrupt assets and purchased various assets through them.
The total amount of legalized property is over UAH 300 million.
Among the assets identified
- land plots in Croatia;
- luxury cars;
- an entire floor of apartments in a residential building in the United Arab Emirates;
- other expensive property.
These assets were registered through foreign companies to conceal their true origin.
How the corruption scheme worked at state-owned enterprises
According to the investigation, the former head of the State Property Fund, together with his accomplices, appointed “his” people as directors of JSC “Odessa Port Plant” and JSC “United Mining and Chemical Company.”
According to law enforcement, the organization’s management appointed loyal directors who:
- sold the enterprises’ products to controlled companies;
- set low prices;
- withdrew profits through front companies.
The difference in cost was withdrawn and converted in the interests of the criminal organization.
This resulted in losses to the state amounting to over UAH 700 million.
Members of the criminal organization are also suspected of laundering more than UAH 10 billion in criminally obtained assets.
Scale of the case: 15 people have already been named as suspects
In total, 15 people have already been notified of suspicions as part of the investigation.
In addition to the direct losses to the budget, law enforcement agencies have established that the members of the organization attempted to legalize assets worth over UAH 10 billion.
The investigation is ongoing, and law enforcement agencies continue to identify new participants in the corruption scheme and search for assets abroad.
