Anti-graft agencies report evidence of high-level embezzlement in the Defense Ministry
Ukrainian anti-graft agencies have announced the results of a major investigation of former senior military officials, including two generals, suspected of running a multi-million dollar embezzlement scheme.
The Ukrainian Defense Ministry reportedly signed a contract for a key command and control system in 2016 with a commercial company that had no experience in creating software. Over four years of development, the technical specifications were changed 13 times, increasing the cost by $7 million. The Dzvin-AS troop command-and-control system only entered into service in 2022.
On Friday, the National Anti-Corruption Bureau (NABU) and Specialized Anti-Corruption Prosecutor’s Office (SAPO), said the investigation had moved to the legal disclosure phase that typically precedes formal indictments.
The alleged ring included a deputy head of the Ukrainian General Staff, a deputy commander of Communications Troops, the head of the General Staff’s automation department, and a businessman whose firm won the contract to develop the Dzvin-AS. Investigators say delays and cost overruns that plagued the project helped the group embezzle $5.7 million.
Reports of problems with the Dzvin-AS surfaced in the media as early as 2021, citing a 2020 contract audit. In December 2022, months after the conflict with Russia escalated, then-Defense Minister Aleksey Reznikov ordered the system’s deployment. NABU said in 2024 the Defense Ministry considered funding expansion for the system rather than fixing or scrapping it.
Reznikov resigned in 2023 over a separate corruption scandal involving inflated food procurement contracts but was never charged with any crime. NABU called the two investigations the agency’s most important efforts to fight military graft.
