MOSCOW, April 18 (RAPSI) – The Investigative Committee has launched a new criminal case over abuse of office against ex-Deputy chief of the Federal Penitentiary Service (FSIN) Oleg Korshunov charged with embezzlement of 160 million rubles (about $2.8 million), the press-service of the Committee has stated.

According to investigators, in 2015, after signing a contract for construction of a detention center in Simferopol, the defendant also facilitated signing of a contract with a company under his control Unistroy knowing that the firm is not capable of finishing the works.

Although Korshunov transferred 193 million rubles ($3.1 million) to the company, the project is yet to be completed.

Initially Korshunov was charged with two counts of embezzlement; however, this February, two fraud cases were launched against him as well.

Investigators believe that Korshunov conspired with CEO of Russian footwear company Datse Group, Smbat Arutyunyan, and the head of state-run production company FSIN Russia Vitaly Morusov. Allegedly, Korshunov ordered to use prisoner labor to manufacture footwear from cheap materials provided by Datse Group. Later, he allegedly facilitated signing of a state contract with FSIN Russia.

Allegedly, Morusov was aware of the criminal scheme and did not plan to actually supply the goods. As a result, FSIN employees were deceived about the price and transferred over 90 million rubles (about $1.5 million) to FSIN Russia.

Investigators also claim that Korshunov organized signing of two government contracts on delivery of fuels and lubricants and food products at an overvalued price between 2015 and 2016. Actions of Korshunov and his accomplices allegedly caused a 160-million-ruble damage (about $2.8 million at current exchange rate) to the FSIN. He pleaded not guilty.

Korshunov was appointed to the post of FSIN deputy head in March 2014. He has been bestowed the rank of Full State Counsellor 2nd Class of the Russian Federation.