Ukrainian investigators say they uncovered arms procurement fraud

(Patria) - The Security Service of Ukraine (SBU) and the Ministry of Defense announced on Friday that they uncovered a scheme for fraudulent procurement of artillery shells involving embezzlement of nearly $40 million, Reuters reported.

Corruption in Ukraine, more than thirty years after the end of Soviet rule, has become an even more important issue as Kyiv continues its bid to join the European Union. Incidents of corruption in the military, including procurement, have caused several scandals.

A statement issued by the SBU stated that the corrupt scheme focused on contracts for the procurement of artillery shells.

The recently established procurement agency of the Ministry of Defense abandoned contracts for
providing shells at prices higher than market value and entered into a new agreement that
eliminated intermediaries and significantly reduced the price.

However, a high-ranking ministry official, as stated, extended the previous contract, and funds totaling nearly $140 million were deposited into accounts belonging to intermediary companies. The official, the main suspect in this case, has been dismissed from his post, legal proceedings have been initiated against him, and efforts are underway to recover the money.

A statement from the Ministry of Defense stated that the scheme was discovered last week and that an audit confirmed the illegal activity. Searches were conducted within the ministry and in other premises.