Ukraine ammunition scam: the trail leads to Prague and Czechia

The collapse of a mortar ammunition delivery to Ukraine, worth about a billion crowns, has a Prague trail: part of the money was withdrawn in cash in Prague. According to the case files, the key role was played by Ukrainian Oleksiy Khoroshayev, who is fighting extradition to his homeland from a Czech detention center.

An order worth 855 million crowns

Before the war, Khoroshayev was a senior manager at a Ukrainian state arms trading company. After the war began, he looked for military equipment for Ukraine from Czechia, this time as a private individual. An earlier order of his for body armor and helmets worth more than 300 million crowns had failed: most of the 17,000 sets never arrived.

In the autumn of 2022, Khoroshayev brought a Ukrainian Defense Ministry order for 100,000 mortar shells to a small Slovak firm, Sevotech. According to the firm's owner, Ján Chodermarský, Khoroshayev ran the deal from start to finish and was to receive almost half of the company. The value of the order came to 855 million crowns in conversion. At the end of 2022, the Ukrainian Defense Ministry paid the money in advance to a young company, Lviv Arsenal, without seeing a single shell.

According to Ukrainian police, a significant part of the funds got lost in a complex chain of commissions and companies. The money went through Sevotech to Czechia, Croatia, Bosnia and Herzegovina, Slovenia and Bulgaria. Only a small part reached Ukraine: 3,000 shells.

What is known about the investigation

In Ukraine, five defendants are on trial: two Defense Ministry officials and representatives of Lviv Arsenal. The trial has been going on for a year, and they face 7 to 12 years in prison. Khoroshayev is not among them: Czech police detained him in September 2024 at Ukraine's request on suspicion of embezzlement and of organizing the foreign part of the scheme. He is avoiding extradition by applying for asylum in Czechia.

A representative of Ukraine's Security Service (SBU) confirmed to the outlet that the case was uncovered in 2024 and that seven people are being prosecuted. Two of them, one a foreign national, have been put on an international wanted list. According to his lawyer, Khoroshayev denies guilt and blames his Croatian partners for the money.

The Croatian trail and cash in Prague

In testimony to Czech police in February, Khoroshayev said he turned to an acquaintance, the Croatian arms dealer Zvonko Zubak of WDG. The Croatian plant Elmech was to be the original supplier but terminated the contract after waiting in vain for payment. The delivery was taken over by Zubak's son Matija and his new company, WDG Promet. In December 2022, Sevotech transferred 11.3 million euros (about 276 million crowns) to it.

Roughly half of that, about 138 million crowns, was withdrawn in cash over the following months from WDG Promet's accounts at the Prague credit union PDZ. The parties dispute who did it: Zubak says his signatures were forged, while a former cashier of the union says it was him. The Czech National Bank revoked PDZ's license in late 2024 after finding serious violations, including inadequate protection against money laundering.

The other half, according to Ukrainian and Bosnian investigators, went to Bosnia and Herzegovina: 5.5 million euros (about 133 million crowns) was spent on buying the bankrupt Vitezit plant. In September, Zubak's second son Tomislav appeared before a local court; he faces up to ten years for money laundering and illegal possession of weapons. Ukraine has also put Matija Zubak on an international wanted list; he says he did nothing wrong.

A Ukrainian court has ordered Lviv Arsenal to return the advance; together with sanctions, this comes to almost a billion crowns. It is unclear how much money the Defense Ministry has received back. Ukraine is still short of almost 100,000 shells.

Around Prague, based on reporting by novinky.cz