Ukraine’s SBU security service and the Bureau of Economic Security, known by its Ukrainian acronym BEB, have exposed a criminal embezzlement scheme in exports of Ukrainian grain, the SBU and BEB press services reported on Telegram on Jan. 3
BEB analysts say total estimated losses from the scheme in 2022 stood at UAH 5.2 billion ($142 million).
Over 10 high-ranking officials are involved in the scheme, the press services said. Among them are the deputy head of a department at the State Customs Service or DMSU, and senior officials of the Odesa Customs House. They developed a large-scale scheme for tax evasion in exports of Ukrainian grain, causing the state to lose hundreds of millions of hryvnias.
According to law enforcement officers, more than 370 commercial structures were involved in the scheme. Through them, the suspects bought wheat in bulk from private farmers, agricultural enterprises, and large agricultural holdings.
In order to muddle up trade chains and avoid mandatory payments to the budget, the “businessmen” transferred products from one bogus firm to another. Only after that did they sell grain to exporters for sale abroad.
In particular, in the period of August-September 2022, entrepreneurs exported more than 1 million tonnes of grain of dubious origin through the capacities of grain terminals in Chornomorsk, Pivdennyi and Odesa ports.
BEB analysts estimate the total losses for 2022 at UAH 5.2 billion ($142 million), assuming non-declaration of income from the mentioned export operations in the form of the non-payment of taxes.
According to the investigation, the BEB, having discovered the facts of the involvement of suspicious enterprises in export procedures, warned the DMSU about this in writing.
However, customs officers did not take the information into account and allowed the sale of more than 1 million tons of grain.
BEB employees together with the SBU conducted 30 searches in the premises of the DMSU, Odesa Customs and customs posts in Chornomorsk, Pivdennyy and Odesa, as well as residences of customs officers. Draft records, computers and telephones confirming the customs clearance and shipment of grain crops were seized during the searches.
Documents were also seized that could indicate that the officials were aware of suspicious enterprises being among grain exporters.
Currently, BEB investigators are analyzing the activities of suspicious companies and establishing the full range of persons involved in the scheme. Measures are being taken to bring them to criminal responsibility and to reimburse the state for damages.
A pre-trial investigation is being carried out into an offense under Part 2 of Art. 364 of the Criminal Code of Ukraine — abuse of official position that caused grave consequences.