VLADIVOSTOK, April 16 (RAPSI) – A criminal investigation has been opened into the alleged embezzlement of some 4 billion rubles (over $79 million) during the construction works at the Zvezda Shipyard, the leading plant for repairing submarines of the Pacific Fleet, Deputy Prime Minister Yury Trutnev said on Thursday at a joint meeting of the Prosecutor General’s Office and the Ministry for the Development of the Far East.

In early November 2013, the Main Military Prosecutor’s Office revealed evidence of fraud with the repair of warships at the Far Eastern Plant “Zvezda.”  Investigators claimed that a contractor allegedly received over 63 million rubles ($1.25 million) by overstating construction costs. It was later reported that seven criminal cases had been opened at the shipyard and that damages had been estimated at 1 billion rubles ($20 million). 

Yury Shulgan, the plant’s ex-director, was given a three-year suspended sentence and 550,000 ruble ($10,900) fine for embezzling 29 million rubles ($547,200). 

In February 2015, the Primorye Territory Prosecutor’s Office initiated a comprehensive audit at the plant.

The Zvezda plant is a large shipbuilding and engineering division in the Russian Far East. It mostly repairs submarines for the Russian Pacific Fleet and is also Russia’s only plant in the Far East that repairs, retools and upgrades nuclear submarines. 

Shipbuilding Complex "Zvezda"  that is being built will manufacture equipment for the offshore projects of the Rosneft and Gazprom oil and gas companies under the import substitution program.

The construction of the first phase of the new facility, which is scheduled to come on stream in 2016, will cost 45 billion rubles ($890 million).