Since the start of the full-scale war, Ukraine has transferred about 770 million dollars in advance to foreign companies for weapons and ammunition that have not been delivered.
This was reported by Financial Times after conducting its own investigation.
Journalists identified about 30 contracts with serious irregularities, detailing two of them, namely those related to the companies:
- OTL Imports
It is noted that one of these contracts was an agreement between the Ukrainian state-owned special exporter Progress and the American ammunition seller OTL Imports, registered in Arizona. The company was founded by 28-year-old entrepreneur Tanner Cook, who was recommended to Progress by a businessman who had previously participated in the preparation of a contract with Iraq in 2009.
At the same time, Cook promised to supply mines and mortar shells produced in Serbia. In November 2022, Ukraine transferred him an advance payment of 17.1 million euros, which amounted to 35% of the total amount of the contract. However, the delivery never took place. Subsequently, the National Anti-Corruption Bureau of Ukraine (NABU) initiated a criminal investigation to find out where the funds were transferred.
It is reported that Progress filed a lawsuit against OTL in the arbitration court in Vienna and won the case. The court ordered the US company to pay 21.3m euros, including the amount of the advance payment, court fees, interest and fines. Ukraine is now seeking recognition of this decision in the USA.
Meanwhile, as noted in the investigation, Tanner Cook continued to develop his business at the expense of Ukrainian funds, attended arms exhibitions around the world and, judging by his activity in social networks, led a luxurious lifestyle.
- Regulus Global
Another controversial contract was signed with the American company Regulus Global, founded in 2012 by former Merrill Lynch employee Will Somerindyke. Regulus specializes in the purchase and resale of surplus arms.
At the end of 2022, Regulus offered Spetstechnoexport the delivery of tens of thousands of artillery shells of 155 mm caliber, the origin of which gave the deal a special value, as they were to come from a manufacturer from a country with close ties to Russia.
The total value of the contract could reach $1.7 billion, depending on the volume of deliveries. As part of the agreement, the Ukrainian side transferred $162.6 million to Regulus in the form of advance payment and deposits, and additionally paid 14 million euros.
Later, Spetstechnoexport accused the partner of violating the terms of the contract, as the deliveries were not fulfilled and the funds were not returned. Since September 2024, Regulus has stopped contacting the company. According to the former head of the state-owned company, Olexiy Petrov, the company probably used the Ukrainian funds to develop its own infrastructure.
To recover the funds, Spetstechnoexport has applied to the arbitration court in London, where it is demanding the recovery of $346 million from Regulus, including not only prepayments, but also debts with penalties.
At the same time, Regulus denies all the accusations, claiming that it was the Ukrainian side that failed to fulfill its obligations under the contract and owed them about $350 million.
In addition, in September 2023, Regulus tried to transfer the execution of the contract to a new Ukrainian defense procurement agency headed by Marina Bezrukova. However, according to Bezrukova herself, this move was blocked after the company requested a second advance payment.
