Chief accountant of Ferrexpo's Poltava Mining and Processing Plant suspected of forgery, costing state $55 mln

MOSCOW. Feb 2 (Interfax) - Ukrainian law enforcement suspects a top manager of the Poltava Mining and Processing Plant (PGOK), part of the Ferrexpo group, of committing actions that led to significant losses for the state.

"The Security Service of Ukraine, or SBU, together with the Economic Security Bureau and the Prosecutor General's Office, reported they had suspicions about one of the top managers of the Poltava Mining and Processing Plant, which is part of the Ferrexpo group of companies and owned by a fugitive Ukrainian oligarch," Ukrainian media said, citing the SBU's Telegram channel.

According to the service, the actions of the suspect led to the enterprise evading rent payments of about UAH 2 billion, or about $55 million, to the state budget for the use of the iron ore deposit subsoil. The conclusions of comprehensive examinations conducted during the pre-trial investigation confirmed the amount of damages.

"The investigation found that between 2018 and 2021, the manager entered false information into the official documents of the enterprise. This caused significant losses to the state," the statement says.

Criminal proceedings were opened under Ukrainian Criminal Code Part 3.212 for evasion of taxes or fees, and Part 1.366, for forgery by an official. The issue of whether or not the suspect should be arrested and incarcerated is being determined. The SBU is continuing to identify all individuals who may be involved in the commission of the offense.

The Economic Security Bureau eventually clarified that the suspect is in fact the chief accountant of the plant. "The issuance of official documents with deliberately false information made it possible to avoid paying taxes in the amount of about UAH 2 billion. ESBU detectives reported their suspicion to the chief accountant of the enterprise," the bureau's website says.

Ferrexpo shares on the London Stock Exchange initially dropped in price from 158 to 154.2 pence after this information was made public, but then came back, reversing the decline in full.

Ferrexpo is an iron ore company with assets in Ukraine, which is part of the group of companies belonging to Konstantin Zhevago; he owns 100% of the shares of Poltava GOK, 100% of Eristovsky GOK and 99.9% of Belanovsky GOK.