Under the Shadow of War, a Scam: Defense Companies Caused Ukraine Hundreds of Millions in Losses
Serious fraud allegations involving companies in Ukraine's defense procurement processes during the most critical days of the war have hit the headlines like a bombshell.
Among the companies accused of causing $10.8 million in losses to the Ukrainian state is ASSAN Group, which is also banned from public tenders in Turkey.
It has emerged that Ukraine, which has been trying to meet urgent equipment needs in its war with Russia for over a year, was unable to fulfill some of its contracts with defense industry companies.
According to widely circulated claims in the Ukrainian press, some Turkish companies, despite receiving large advance payments, either never delivered the promised military equipment or sent incomplete and low-quality products.
ASSAN Caused Millions in Losses to Ukraine
According to reports in Ukrainian media, the state defense company Spetsteknoeksport signed a $10.8 million contract with ASSAN Group on December 19, 2024.
Despite receiving a 100% advance payment without collateral under the agreement, the company failed to deliver the promised products on the specified dates. Deliveries were still not made even after Ukrainian authorities granted multiple deadline extensions.
As a result, it is reported that legal action against the company in the Ukrainian war crimes court is now on the agenda.
Senior ASSAN officials, reached by gdh, responded to the allegations by saying they would make a statement "if necessary."
The ASSAN Group incident is not the only problem Ukraine has faced with defense firms.
Ukraine Trusted, the Money Vanished!
Six defendants, including Murat Özvardar and Koray Altınel, were accused of receiving $5.1 million from the Ukrainian Ministry of Internal Affairs by promising to supply helmets, bulletproof vests, and weapons.
The defendants reportedly gained trust by claiming they had ties with “high-level Turkish officials” and then failed to deliver the equipment after receiving the advance.
They are being tried on charges of "qualified, serial fraud," with prison sentences of up to 22 years and 6 months being sought.
A similar situation occurred in 2023 with Patriam Defense Industry Ltd. Co.
The company, which promised to sell gunpowder to the Ukrainian government, received a $28.5 million advance. Its owner, Yahiç Berk, fled to Canada following the incident.
It was claimed that the company only made a partial delivery worth $756,000 under a $29.2 million arms and ammunition agreement signed with Ukrainian state company SE “RIC PCP” in 2023.
The Ukrainian side is reportedly pursuing a legal claim worth $37.42 million, including interest and penalties, for the undelivered goods valued at $28.46 million.
€850 Million Lost in Bulgaria
Procurement irregularities are not limited to Turkey.
Similar cases—on a much larger scale—have been reported in neighboring Bulgaria, with around €850 million said to have disappeared.
After the start of the Ukraine war, the number of firms in Bulgaria authorized for arms import-export increased a hundredfold, paving the way for an unregulated and opportunistic market.
One of these firms, Mimaltemer Ltd., alone reportedly caused a loss of €86.5 million to Ukraine through low-quality equipment and irregular financial transactions, according to investigation files.
These negative experiences have undermined trust in the strategic defense partnership between Turkey and Ukraine and have also prompted action from the Kyiv administration.
Ukraine aims to block such intermediary and opportunistic companies through new defense procurement agencies established for 2024–25 and the "Prozorro" tender system, which is designed to increase transparency.
Such incidents typically occur in projects where 100% advance payments are made without taking any collateral at the start.
Savaşın en kritik günlerinde Ukrayna'nın savunma tedarik süreçlerinde firmalarının adının karıştığı ciddi dolandırıcılık iddiaları gündeme bomba gibi düştü.
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