A Moscow court has remanded Vladimir Pavlov, the CEO of Voentorg, a major supplier to the Russian Army, in custody until September 30. He stands accused of swindling the Defense Ministry out of some 400 million rubles ($4.68 million) by supplying it with goods at inflated prices.
According to investigators, Pavlov, together with accomplices at Voentorg and at other companies, entered into a criminal conspiracy in 2019. At that time, Voentorg signed government contracts with the ministry worth a total of 625 million rubles ($7.31 million) for the supply of toiletry bags to army troops.
Pavlov’s alleged accomplices then bought the necessary equipment from manufacturers through the entities they controlled and then re-sold it to the defense ministry at greatly inflated prices. The financial damage sustained by the government amounted to 400 million rubles ($4.68 million), according to the probe.
Pavlov, 67, now faces ‘serious fraud’ charges and could spend up to ten years behind bars if found guilty.
Investigators have also stated they have information suggesting that the accused could exert pressure on witnesses or the inquiry itself and requested that Pavlov be placed in custody. They also asked the court to close the judicial proceedings to the media and the public.
Pavlov has denied any wrongdoing, claiming he “had not seen a hint of his guilt” in the investigation materials. His lawyers also maintain that their client had nothing to do with the contracts in question and did not personally sign them. The Voentorg CEO said he has no intention of fleeing, hiding or attempting to hamper the investigation in any way.
The judge agreed with the investigators’ arguments, however, and Pavlov will remain in pre-trial detention for two months. Pavlov’s lawyers are expected to appeal the decision, according to the Russian media. The judge has refused, however, to close the proceedings to the public and media.
Voentorg is a state company that acts as the only military clothing supplier to the Russian Armed Forces. It is also responsible for providing the military with various support services, including food. Pavlov ran the company for more than 12 years.
Several senior Russian defense officials have been arrested in recent months on suspicion of corruption. They included Vadim Shamarin, the head of the Main Directorate of Communications, Deputy Defense Minister Timur Ivanov, and Yury Kuznetsov, the head of the Main Personnel Directorate of the Defense Ministry.
Most of those arrests came after Russian President Vladimir Putin replaced Defense Minister Sergey Shoigu with Andrey Belousov, an economist who previously served as first deputy prime minister. Shoigu was then appointed secretary of the Russian Security Council.