Law enforcers expose large-scale scam on purchase of military uniforms

The National Police reported the disclosure of a scheme in which participants seized more than $10 million during the purchase of military uniforms for the Ukrainian military. A former advisor to the Ministry of Defense, a former MP of the II-IV convocations, and his son are suspected of the crime.  

How did the scheme work?

• Organizer: An international fraudster, previously convicted in France, Spain, Turkey and Indonesia, involved a Turkish textile holding in the scheme by promising to facilitate a contract with the Ministry of Defense.
• Overpricing: The Turkish side estimated the production of the uniforms at $25.6 million. However, the contracts with the Ministry of Defense were signed for more than $35 million through an intermediary company controlled by the intermediary.
• Embezzlement: The scheme participants planned to embezzle the difference of $10 million.

The intermediary paid an advance of USD 10 million to the Turkish company, after which the received form was delivered to Ukraine. However, the Turkish party never received the remaining amount. The fraudster spent the money on personal needs, including the purchase of luxury cars and real estate.  

The police conducted 38 searches and seized documents, equipment, and other evidence. Three defendants in the case were notified of suspicion of fraud on a large scale (Part 4 of Article 190 of the Criminal Code of Ukraine).  

The defendants face up to 12 years in prison. The issue of seizure of their property is currently being decided. 

According to media reports, businessman Roman Balykin (owner of the ATL group of companies), former MP Ihor Franchuk and his son Yaroslav Franchuk were suspected.