The NABU and the SAPO suspect three individuals of embezzling UAH 102.4 million in state funds during the procurement of explosive reactive armor for the Defense Forces' armored vehicles.

The suspects are:

• Leonid Shyman, former Director General of the state enterprise Research and Production Association Pavlohrad Chemical Plant
• Valerii Kyrylov, Commercial Director of the same state enterprise
• Ihor Khokhlov, owner of the private firm RADA 2007 LLC.

After the start of Russia's full-scale invasion, in April 2022, the Ministry of Defense of Ukraine signed a contract with the Pavlohrad Chemical Plant for the urgent procurement of explosive reactive armor (ERA) for tanks.

According to the investigation, the plant's then-Director General Leonid Shyman organized a scheme to embezzle state funds. To do so, he brought in two long-standing acquaintances: the plant's Commercial Director Valerii Kyrylov and RADA 2007 owner Ihor Khokhlov. The plan was for the plant to buy components for manufacturing reactive armor for military vehicles — covers and trays — at prices several times above market rates.

Leonid Shyman personally designated Ihor Khokhlov's firm as the supplier and set inflated prices: about UAH 781 per cover and UAH 729 per tray, although their actual market value was around UAH 289 and UAH 287, respectively. To justify the procurement, Khokhlov sent the plant false information indicating that his company manufactured the components itself. As Commercial Director, Valerii Kyrylov signed an official contract with Khokhlov's firm for the supply of 120,000 sets.

After receiving funds from the Ministry of Defense under the state contract, Leonid Shyman directed that they be transferred to RADA 2007. Between April and November 2022, the plant transferred over UAH 165 million to Khokhlov's company in total. In reality, Khokhlov's firm did not manufacture the components but simply resold them, having bought them from the actual producers at significantly lower prices (UAH 84 per unit) or commissioned their production from third-party firms.

To conceal the scheme and create the appearance of lawful activity, the procurement was processed through shell companies, and the difference between the price paid and the real value was channeled to controlled accounts for subsequent laundering.

As a result of this scheme, the plant paid UAH 165.6 million for the goods, although their real market price at the time was only UAH 63.2 million. The state thus suffered over UAH 102.4 million in damages.

Shyman's actions were classified under Article 27(3) and Article 191(5) of the Criminal Code of Ukraine;

Kyrylov's, under Article 191(5) of the Criminal Code of Ukraine;

Khokhlov's, under Article 191(5), Article 209(3), Article 28(2), and Article 366(1) of the Criminal Code of Ukraine.

NABU detectives exposed the suspects in a joint operation with the SSU.

The court remanded Leonid Shyman in custody, with the alternative of UAH 30.28 million bail. The investigation pointed to a flight risk: when detectives attempted to serve a notice of suspicion, Shyman's driver tried to flee from NABU detectives. It also emerged that the official had granted powers of attorney to obtain Romanian passports for himself and his children — which the court treated as preparation to leave Ukraine.

The court was unable to set a preventive measure for Valerii Kyrylov for some time, as he repeatedly failed to appear at hearings. Eventually, however, the court set UAH 900,000 bail for him as well. The court ordered the arrest of Ihor Khokhlov in absentia. According to law enforcement, he is in the United Arab Emirates.

In addition to this case, Shyman is a suspect in another case involving nearly UAH 28.5 million in abuses during a 2016 pipe procurement. According to the investigation, he artificially secured victory for the American company Petroleum Materials LLC in a tender and signed off on 100% advance payment ($918,000). The goods were never delivered, causing losses to the state.

Shyman is also a defendant in a case involving the supply of defective mortar shells to the Armed Forces of Ukraine. The case is being heard by the Shevchenkivskyi District Court of Kyiv. The investigation established that PCP officials knowingly delivered over 233,000 unusable mortar shells to the Armed Forces, causing UAH 3.3 billion in damages to the state.

Shyman and Kyrylov are also charged in a case involving over UAH 43.3 million in damages to PCP from the sale of industrial explosives under a similar scheme.

In a separate case, Valerii Kyrylov received a four-year prison sentence for the sham use of intermediary companies in the sale of explosives produced by SE RPA PCP. His actions caused over UAH 7 million in damages to the state. The HACC Appeals Chamber upheld the verdict.