41 million UAH for traffic lights, nearly 21 million UAH in the suspects' pockets: ESBU puts an end to the scheme

 Seven members of a criminal group will stand trial for misappropriating approximately 21 million UAH in connection with the purchase of uninterruptible power supplies for traffic lights. The group includes a director and an employee of a communal institution of the Odesa City Council, businessmen, and a lawyer.

Detectives of the Territorial Office of the Economic Security Bureau of Ukraine in the Odesa region established that the owner of a group of companies, along with officials from the Communal Institution “Specialized Installation and Enforcement Unit” of the Odesa City Council, organized a scheme to misappropriate budget funds. The suspects signed contracts to supply uninterruptible power supplies through controlled firms at inflated prices.

The officials set the expected purchase prices based on fake commercial offers without doing a real market analysis. They wrote the technical requirements to fit one specific manufacturer, which basically kept other competitors from entering the bidding process.

Over 5 months in 2024, the communal institution held 11 purchases and signed contracts worth over 40.8 million UAH. The winners were businesses working in collusion with the organizer of the scheme.

To avoid getting caught by oversight authorities, they brought a lawyer into the scheme. The lawyer handled communication between the members and created mechanisms to cover up the illegal activity.

However, an analysis of tax invoices showed that the suspects resold the equipment through controlled firms. Because of this, the cost for the communal institution jumped to almost double the manufacturer's price, and the multi-million UAH difference ended up in the pockets of the scheme members.

According to the conclusions of forensic economic examinations, the local community of Odesa suffered damages of nearly 21 million UAH.

To ensure repayment of the damage caused to the city budget, assets were frozen. These included the suspects' bank accounts, corporate shares in businesses, real estate properties, and vehicles.

Based on the collected evidence, seven individuals were notified of suspicion. This group includes the organizer of the scheme, the director of the Communal Institution “SIEU”, business managers and employees, a lawyer, and a procurement specialist. The court selected restrictive measures for the suspects, ranging from custody with the right to post bail to 24-hour house arrest.

The criminal case under Part 3 of Article 28 and Part 5 of Article 191 of the Criminal Code of Ukraine (Misappropriation, embezzlement, or seizure of property through abuse of office) regarding the organized group has been sent to court with an indictment.

Operational support was provided by the Strategic Investigations Department in the Odesa region of the National Police of Ukraine and the Security Service of Ukraine in the Odesa region. Prosecutorial guidance was provided by the Odesa Regional Prosecutor's Office.

Please note that according to Article 62 of the Constitution of Ukraine, a person is presumed innocent until proven guilty in a court of law.