A high-ranking official in the Russian military has been arrested as part of a major fraud case involving inflated costs of timber materials used in the construction of trenches and bunkers on the Ukrainian front line.
It comes amid global coverage which claims that Russian corruption in the military, in the government and among oligarchs has helped Ukraine fend off a Moscow invasion.
Yesterday, Vladimir Shishov, deputy director of the Russian Defense Ministry’s military property department division, and Dmitry Levchenko, CEO of an Oligarchi timber company known as IFK RNGS Capital, were arrested on charges of large-scale fraud.
Until 2018, Mr Shishov was deputy head of the Russian Federal Forestry Agency and has deep connections to the Kremlin.
In the months up to the Ukraine invasion, he was appointed by “presidential decree” as “Major General of the Russian army.”
Known as a “Fixer,” Mr Levchenko runs one of the local timber companies with deep connections to Russian Oligarchs.
He has previously been implicated in numerous criminal cases, including transferring billions of (U.S.) dollars under the so-called Moldovan scheme.
As reported in the Russian newspaper, Kommersant greatly inflated the cost of lumber materials provided to the Defense Ministry, with the total fraud potentially exceeding 1 billion rubles (or U.S. $10.7 million).
It is part of a crackdown by Putin on defence procurement, with the contract one of several issued to timber companies in October 2022.
Kommersant states, “The case offers a stark reminder of the potential for corruption within the Russian defence industry and the inherent risks of fraudulent practices in government contracts.”
The concerns are that Russian Oligarchs, who are fueling the global trade of conflict timber, are also profiting from corruption within the Russian military.
According to U.S. Media, graft in the Russian military, particularly during its Soviet history, is not a new phenomenon, nor is it limited to an accounting of the number of troops it can field.
Corrupt practices have hollowed out not only the armour of its tanks but also the accurate numbers of its fighting forces and its ability to equip its front-line troops as its top commanders to provide honest assessments of the state of the equipment and active duty and reserve forces they oversee.
“These are the kinds of things that result from either total incompetence or corruption: false reporting, people signing off on things that don’t meet standards, and, of course, the individual Russian soldier. It’s legendary the stealing that they do,” according to retired Army Lt. Gen. Ben Hodges, who last oversaw all U.S. Army operations in Europe, beginning in 2014 when Russia first annexed Crimea and kicked off the ongoing violence in Ukraine’s east, a region known as the Donbas.
“It’s corruption from the top,” Hodges says, “down to the individual Russian soldier.”