The HACC found Vladímir S. Mokson, a Belarusian-born U.S. citizen, guilty of aiding and abetting the embezzlement of more than UAH 10 million in funds belonging to the Titanium Institute.

According to the investigation, Andrii Rachkov, who headed the State Scientific Research and Design Institute of Titanium, transferred USD 1.258 million as remuneration to the offshore company REMAX LTD for “agency services” related to organizing documentation. In fact, no services were provided or performed, and Mokson facilitated the commission of the offense.

The State Scientific Research and Design Institute of Titanium is a strategic research-and-production institution owned by the state. In May 2011, Andrii Rachkov was appointed First Deputy Director General of the Titanium Institute.

The Titanium Institute entered into a USD 13.6 million contract with Solway Industries LTD to develop the detailed design for the reconstruction of a ferronickel production plant. Preparation of the contract took several years and was carried out without any intermediaries—exclusively by the Institute and the customer company.

Despite this, according to the investigation, Rachkov implemented a scheme to siphon the enterprise’s funds. He entered into an agency agreement with REMAX LTD, which formally was to provide intermediary and consulting services under the contract with Solway Industries.

According to the investigation, Mokson, acting as an accomplice, assisted Rachkov in carrying out the misappropriation of the Titanium Institute’s assets. This involved the systematic creation of formal documents and execution of financial transactions designed to give the appearance of lawful activity, while in reality forming part of a scheme to divert funds.

Rachkov, acting in prior collusion with Mokson and other persons, created formal documentary grounds for payment of remuneration for agency services under the contract between the Titanium Institute and Solway Industries LTD. In doing so, the agency services were not actually performed, and the documents were created solely to formalize unlawful payments.

Rachkov then ensured that funds were transferred from the Institute’s accounts to accounts controlled by Mokson and other unidentified persons. The investigation established that Mokson knew that the services and works contemplated by the agency agreement had not been provided. Nevertheless, acting on behalf of REMAX LTD, he prepared and issued acceptance certificates, which served as the basis for transferring the funds.

As a result, the Titanium Institute transferred USD 1.258 million to REMAX LTD. Mokson then ensured the further transfer of these funds to the accounts of other companies and individuals, effectively concealing their origin and facilitating the embezzlement.

The HACC found him guilty of an offense under Article 191(5) of the Criminal Code of Ukraine. The case was heard in absentia because Mokson resides abroad. The court sentenced him to eight years’ imprisonment, barred him from holding certain positions for three years, and ordered the confiscation of all of his property.

Earlier, the HACC also found Andrii Rachkov guilty and sentenced him to nine years’ imprisonment.