On September 23, 2016 the detectives of the National Anti-Corruption Bureau of Ukraine under the procedural guidance of the Anti-corruption prosecutors and in cooperation with the Office of the Security Service of Ukraine in Zaporizhia Region detained the director of LLC "Zaporizhye Titanium and Magnesium Combine" (ZTMC).
The detention is a part of investigation initiated by the NABU detectives in June 2016 on the fact of abuse of official post by ZTMC officials that led to a large-scale embezzlement of funds.
The detained director of ZTMC is to be given a notice of suspicion for allegedly committing a crime under Part 5 of the Article 191 of the Criminal Code of Ukraine ("Misappropriation, embezzlement or conversion of property by abuse of official post").
The investigation revealed that during 2014-2015 the Combine’s co-owner company «TOLEXIS TRADING LIMITED» had allocated 880 million UAH to modernize the production of ZTMC, according to the incorporation contract. However, the director of the enterprise, abusing his office, made an embezzlement of the major part of funds received (492 million UAH) by transferring them to third parties. In particular, instead of financing costs for the modernization, the funds were allocated to JSC "Holding company" Energomerezha", JSC "Zaporizhiaoblenergo", JSC "Commercial Bank "Nadra" and LLC "Syntez Resurs” as a repayment of the debt of the SE ZTMC. Hence those payments had to be made by «TOLEXIS TRADING LIMITED» Company under the conditions stipulated in the ZTMC incorporation contract.
If found guilty, the director may face imprisonment from 3 to 6 years with disqualification to hold certain positions or to be engaged in certain activities for up to three years.
LLC "Zaporizhye Titanium and Magnesium Combine" was established in 2013 by the state through the State Property Fund of Ukraine (owns 51% of the share capital) and the Cyprus company «TOLEXIS TRADING LIMITED» (49%). The latter undertook to pay debts of the state enterprise, which served the basis for LLC establishment, and to invest 110 million USD to introduce advanced domestic and foreign technology and equipment.
"Zaporizhye Titanium and Magnesium Combine" is the sole producer of spongy titanium in Europe.