BEB blocked the work of the Ukrainian Armor enterprise - the head is suspected of financial frauds

The Economic Security Bureau (ESB) has blocked the operation of the "Ukrainian Armor" company due to accusations of causing damage to the state. What both sides say.

Investigation

Back in May 2023, after searches and the seizure of body armor and other ammunition worth more than ₴40 million, the company's accounts were frozen. For almost a year now, the company's operation has been effectively blocked, "Ukrainian Armor" does not participate in state procurement. This month, Denis Milinevsky, the company's commercial director, was suspected by the ESB of tax evasion and financial manipulation. The investigation is ongoing, along with an examination that should prove the damage caused.

Investigators suspect falsification of documents, based on which in April-June 2022 "Ukrainian Armor" was able to enjoy benefits for importing military goods into Ukraine - which allegedly were actually sold through specialized stores. In this way, goods worth over ₴100 million were imported, of which the state did not receive ₴30 million in taxes.

Company's Version

As Denis Milinevsky says, the ESB attributed the tax evasion to the entire company's imports, despite the fact that an additional 2% single tax rate was in effect at that time. Last autumn, the company complained to the President's Office, where they promised to deal with the situation, but so far nothing has changed.

In 2024, "Ukrainian Armor" aimed to produce and sell its own ammunition to the state. The manufacturer built corresponding capacities and overcame all necessary bureaucratic obstacles. In December, the company became the first manufacturer certified by the Ministry of Defense for body armor for military personnel - there are only two such companies.

"Ukrainian Armor" links the open cases with the expansion of its own production, which allowed it to participate in the Ministry of Defense tenders - allegedly after that, the actions of the ESB began. This is according to the company's CEO, Yan Goncharov. According to him, the company's production capacity increased tenfold at that time. Freezing of accounts and the criminal case effectively made production and attracting investments impossible.

Why it matters

Only six manufacturers in Ukraine, including "Ukrainian Armor", can produce body armor in full compliance with all requirements. The company also produces ballistic helmets and other tactical ammunition. But the company's production has been blocked for a year because of this case.

"Ukrainian Armor" sells products in an online store and six proprietary stores in Kyiv, Bila Tserkva, Zaporizhia, and Dnipro. In 2019, the company's UARM brand entered the US market.

Since the beginning of the massive Russian invasion in 2023, "Ukrainian Armor" directly supplied 60,000 armor plates and 30,000 helmets to the Armed Forces of Ukraine. In 2024, it intended to sell its own ammunition to the state.

The State Rear Operator (SRO) was supposed to acquire about 135,000 body armor through a tender for 10 lots. A supplier was found for only one of them - the production of 15,000 body armor. The rest of the purchases "stalled" due to a lack of suppliers that met the tender requirements. The production of "Ukrainian Armor" could provide 45,000 body armor and about a third of the annual needs of the Armed Forces of Ukraine in armored ammunition, but this is not happening due to the situation described.

Source: Forbes