Investigators Probe $260,000 Russian Defense Firm Theft

UFA, March 25 (RIA Novosti) – Authorities in Russia are investigating the suspected embezzlement of more than 8 million rubles ($260,000) at a state-owned defense firm, the Federal Security Service said on Monday.

Investigators say managers at an aircraft plant in the city of Kumertau illegally diverted the funds under the guise of customs duties for imported equipment.

The Federal Security Service said in its statement that suspects face up to 10 years in jail on charges of gross fraud.

The Kumertau aircraft factory, based in the Urals republic of Bashkortostan, manufactures equipment for the security services, the Interior Ministry, and the Emergency Situations Ministry, and supplies equipment to a number of foreign states.

Also on Monday, the Chief Military Prosecutor’s Office said it is investigating the suspected embezzlement of more than 30 million rubles ($975,000) at the Aerospace Defense Forces.

Prosecutors said substandard equipment showing signs of wear and including components manufactured over 20 years ago was presented as new and delivered to an Aerospace Defence Forces unit under a government contract 18 months.

Russia’s defense sector has been rocked over the past few months by a string of corruption scandals that led to the resignation in November of defense minister Anatoly Serdyukov.

Several people employed by the Oboronservis defense property services company were arrested late last year on suspicion of fraud totaling over 13 billion rubles ($430 million) involving the illegal sale of ministry property.

The Russian Federal Defense Contracts Service said Friday that about 1,500 violations and infractions were uncovered in state defense spending in 2012, involving over 16 billion rubles ($533 million).

Over 2 billion rubles was returned to state coffers and over 3.5 billion rubles’ worth of damage was averted last year, the service said.

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