According to the Security Service of Ukraine, five people are charged with embezzling funds for the purchase of 100,000 mortar shells.

Employees of a Ukrainian defense company conspired with Defense Ministry officials to embezzle nearly $40 million earmarked for the purchase of 100,000 mortar shells for the war with Russia, the Security Service of Ukraine (SBU) reported.

The SBU said late Saturday that charges had been filed against five people and one person had been arrested while trying to cross the Ukrainian border. If found guilty, they could face up to twelve years in prison.

The announcement, confirmed by the Ukrainian Defense Ministry, will have a profound impact on a country suffering from the crisis Russia’s nearly two-year-old invasion.

The SBU said an investigation “exposed Defense Ministry officials and managers of arms supplier Lviv Arsenal who stole nearly 1.5 billion hryvnias.” [$40m] when buying mussels.”

“According to the investigation, former and current high-ranking officials of the Ministry of Defense as well as heads of affiliated companies are involved in the embezzlement,” the SBU said.

The deal included the purchase of 100,000 mortar shells for the military, with the contract signed in August 2022 and payment made in advance.

However, weapons were never provided, the SBU statement said, and some funds were then transferred to other foreign accounts.

Five people were served with “suspicious suspicion reports” – the first stage of a Ukrainian court case – both at the ministry and at the arms supplier, the security service said in a statement.

A suspect, the SBU said, was arrested while trying to cross the Ukrainian border.

Officials accused of involvement in the plan include the current and former heads of the Defense Ministry’s Department of Military and Technical Policy, Armaments and Military Equipment Development, and the head of the Lviv Arsenal.

According to the Prosecutor General of Ukraine, the stolen funds have been confiscated and will be returned to the defense budget.

Corruption within the Kiev military is a sensitive issue, both in trying to maintain and present public morale during the war case to join the European Union.

Last September, Defense Minister Oleksii Reznikov was fired due to various corruption cases.

Russia is attacking large parts of Ukraine

The announcement came as Russia launched drone and missile strikes that hit both civilian and critical infrastructure across Ukraine, the Kyiv Air Force said on Sunday.

The Air Force said Moscow attacked the central Poltava region with two ballistic missiles fired from its Iskander ballistic missile system. Three surface-to-air missiles were also fired over the Donetsk region in the east.

In the southeastern Zaporizhzhia region, Governor Yuri Malashko said an infrastructure site had been hit in a drone strike.

Filip Pronin, governor of the Poltava region, wrote on Telegram that the attack there hit an industrial site in the city of Kremenchuk and started a fire.

There were no preliminary reports of casualties, Kiev said.