New Developments in GLONASS Embezzlement Case

June 24, 2013
"GLONASS-M" Photo: Alexander Kryazhev / RIA Novosti

[This article reports on new criminal complaints filed in relation to the embezzlement of millions of dollars from the GLONASS satellite navigation programme—Ed.]

The Interior Ministry has filed a criminal complaint against the former managers of M2M Telematics, an IT company and a subsidiary of Sistema, JSFC. The company is suspected of involvement in the embezzlement of budgetary resources allocated under the GLONASS Federal Targeted Program.

According to the investigators, in 2012 the management of M2M Telematics signed a number of fictitious contracts with subcontractors, and allegedly received 380.5 million roubles ($11.5 million) for their work under the GLONASS program. In reality, the money was embezzled.

Igor Grushelevsky, the former M2M Telematics CEO who was in charge of the company in 2012, called the charges “completely trumped up,” and stated that under his management the company was never involved in any activities under the GLONASS program. Grushelevsky suggested that the criminal case is connected with a corporate conflict between Sistema, JSFC and its minority shareholders, himself included. Sistema, in turn, declared that there is no connection between this criminal case and the conflict with shareholders.

According to Kommersant, the documents related to suspicious activities by the M2M Telematics were discovered during an investigation of the embezzlement of 565 million roubles ($17 million) allocated for GLONASS. That investigation started back in spring of 2012. Since then, a number of new facts have emerged.