Five Charged in GLONASS Embezzlement

March 26, 2015  - By
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Five people stand accused of embezzling 250 million rubles (more than $4 million) in federal funds earmarked for Russia’s GLONASS program, according to information shared by the Russian Legal Information Agency and reported in the Izvestia newspaper. The investigation began in 2013.

Charges have been brought against George Kovkov, deputy general director of the Central Research Institute of Machine Building, or TsNIImash; Alexander Chernov, chief of the company’s Capital Projects Department; Alexander Belov, general director of one of the Federal Special Construction Agency’s departments; Dmitry Belitsky, owner of the company Verny Consulting; and Roman Martynenko, general director of SpetsMonolit OOO.

Martynenko and Belitsky have also been charged with money laundering. None of the men pleaded guilty.

The GLONASS program has cost 140 billion rubles ($2.4 billion) to date, and its budget for 2012-2020 stands at a further 326 billion rubles ($5.5 billion). Construction of a GLONASS control center began in June 2010 on the site used by TsNIImash in Korolyov, a town outside Moscow. The construction was financed by a federal program, with 1.05 billion rubles (over $18 billion) allocated for the project.

By the end of 2010, it became clear by the end of 2010 that the construction cost estimates had been overstated, according to Izvestia. An expert appraisal also revealed that the contractor had rigged the costs. Construction was suspended in December 2011 when the Federal GLONASS Program for 2002-2011 ended. The construction of the building has not been completed.

The Federal Security Service (FSB) started looking into the unfinished building in 2013. In January, the FSB asked TsNIImash to provide the construction documents for an inspection, which ended in April. The results were then forwarded to the Investigative Committee and a criminal case opened.

In November 2012, the general designer of GLONASS, Yuri Urlichich, was dismissed from his post as a result of the scandal.

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