Under the procedural guidance of the Specialized Environmental Prosecutor’s Office of the Prosecutor General’s Office, the chairman of the board of a mining and processing plant belonging to a group of companies owned by a member of the Parliament of the VII and VIII convocations was served with a notice of suspicion.
The press release does not specify the name of the plant, but photos and videos show the symbols of the Ferrexpo mining company, which includes Poltava Mining and Processing Plant (PGOK).
The chairman of the board is charged with illegal mining and abuse of power committed by a group of persons by prior conspiracy (part 2 of Article 28, part 4 of Article 240, part 2 of Article 364-1 of the Criminal Code of Ukraine).
According to the investigation, the chairman of the board, having entered into a criminal conspiracy with other unidentified officials of the mining and processing plant, set up an illegal scheme for the use of minerals for the purpose of enrichment.
Under the leadership of the suspect, the company, having a license to extract only iron ore, illegally processed and sold other minerals obtained in the process of mining. These rocks are supposed to be stored in specially designated storage facilities. They were processed and crushed into three different fractions, which were sold to business entities.
Between 2015 and 2021, more than 20 million cubic meters of minerals were illegally mined, which is about 164 thousand railcars. The amount of damage caused is over UAH 157 billion. This money can be used to purchase at least four new Patriot systems.
The issue of choosing a measure of restraint against the suspect and seizing his property for further compensation is being decided. Other persons involved in the crime are being identified in order to bring them to justice.
The pre-trial investigation in the criminal proceedings is carried out by the Main Investigation Department of the National Police of Ukraine with the operational support of the Strategic Investigations Department of the National Police of Ukraine and in cooperation with the State Service of Geology and Subsoil of Ukraine.
The press release reminds that according to Article 62 of the Constitution of Ukraine, a person is presumed innocent of committing a crime and shall not be subjected to criminal punishment until his or her guilt is proved in accordance with the law and established by a court verdict.
As reported in Ferrexpo’s semi-annual report, the company continues to monitor and analyze the situation with the accusations of the company’s management by the State Bureau of Investigation (SBI) of mining without a permit and subsequent sale.
On January 10, 2023, the SBI conducted several searches in connection with an investigation into alleged illegal mining. The National Police of Ukraine also investigated the same case and conducted searches and took samples in the dumps on January 17.
“The position of the Mining and Processing Plant is that the minerals in question are not a separate mineral resource, but are waste products obtained as a result of crushing iron ore during the technical process of producing iron ore pellets,” the report stated.
In addition, it is reported that on June 29, 2023, the SBI served suspicions on three representatives of the top management of the Mining and Processing Plant and the head of one of its divisions on suspicion of selling crushed stone without a permit. The employees were detained by the SBI and later released after posting bail totaling UAH 122 million, which was approved by the court.
The report explains that crushed stone sales were controlled by the State Service of Geology and Subsoil of Ukraine for many years and were stopped by the group in September 2021.
“It is the position of the Group that based on the existing mining license, the Group complies with the relevant legislation. The Group continues to monitor and analyze the situation regarding the suspicions announced by the SBI,” the company’s report summarized.
Earlier, the State Bureau of Investigation issued a press release claiming that the plant’s executives had illegally seized almost UAH 400 million from the extraction and sale of minerals of national importance without the appropriate permits.
“SBI officers, in cooperation with the SBU and the Prosecutor General’s Office, served suspicion notices to the management of the PJSC: the management of the plant’s board, heads of departments through which the company’s financial transactions were carried out, and the management of the gasket company through which the fraud was carried out,” law enforcement officials said in a statement.
According to them, “the cash from the sale was withdrawn through conversion centers and distributed among the members of the criminal group.”
The SBI indicated that 15 searches were conducted in the offices and residences of top managers of the company, gasket companies and companies in the transit and conversion sector.
Ferrexpo is an iron ore company with assets in Ukraine, owning a 100% stake in Yeristovo Mining, 99.9% in Bilanivsky Mining and 100% in Poltava Mining.
