Russian authorities estimate RUB 5 bln fraud in Defense Ministry

Russian authorities investigating the illegal sale of Defense Ministry assets, estimate that RUB 5 bln could have been channeled out of the Ministry, Russian news channel RT reported February 20.

“Authorities are investigating 25 separate instances of fraud in the so-called Oboronservis case involving the illegal sale of the Russian Defense Ministry’s property, Prosecutor General Yury Chaika said on Wednesday,” according to RT.com. “Preliminary estimates suggest the fraud lost the government RUB 5 bln (USD 166 mln).”

The scandal involves the sale of attractive real-estate belonging to the Defense Ministry, by a state controlled holding company called Oboronservis. The property was sold at very low prices.

Russia’s Defense Minister Anatoly Serdyukov was sacked by President Putin after the story broke in November 2012.

The investigation also involves former Defense Ministry Director in charge of real-estate, Yevgieniya Vasilyeva, who was also reportedly Serdyukov’s lover. She coordinated activities in Oboronservis while the Defense Minister was the supervisory board chief.

Vasilyeva pleaded not guilty to defrauding state property, while Serdyukov, who has been summoned to court on a number of occasions, has refused to give evidence.

“In 2012, the number of corruption crimes involving the Investigations Committee [Russia’s main corruption watchdog] increased considerably, despite the general 4% decrease in crime,” Investigations Committee head Alexander Bastrykin said, according to RT.com

“Some 10,000 incidences of bribe-taking were registered,” he added.