Using leaked documents, the Organized Crime and Corruption Reporting Project (OCCRP) has disclosed details of an extensive “weapons laundering scheme” involving Ukrainian companies and authorities. The documents show how the states arms export companies, including Ukrinmash, has been used to effectively “scrub” vehicles, weapons and components of their origin and destination countries.
In one deal, 59 “Ukrainian” amphibious vehicles appear to have been sold to Uganda and Burundi. However, the documents reveal that the vehicles were originally bought from a Polish company called Army Trade, by a Ukrainian company called Techimprex. Poland is an EU member state governed by the blocs arms export rules, but Ukraine isn't. The vehicles were sent to Ukraine in parts and sold to Ukrinmash, the state regulator, who sold them to African clients – the shipping documents declared Ukraine as the country of origin, effectively laundering weapons originally from the EU. Techimprex also looked for weapons in countries including Poland, Slovakia, Moldova, Bulgaria, Hungary, Romania and Bosnia and Herzegovina.
Other documents, detailed in a report released by Amnesty International at the end of September, show how a shell company registered in the UK called S-Profit was involved in a deal that, if implemented, would have led to the “sidestepping” of the EU arms embargo on South Sudan. Since 2013, South Sudan has been embroiled in a civil war has that led to millions displaced or effected by famine, and is subject to a EU arms embargo. The weapons were part of a contract in 2014 between Ukrinmash and a UAE-based company to procure US$169m of weapons on behalf of South Sudan, including thousands of machine guns, mortars, RPGs and millions of rounds of ammunition.
Amnesty International have made it clear they haven't been able to verify whether any of the weapons were ever shipped to South Sudan, but S-Profit may have violated UK export control laws simply by being involved in the negotiation of an arms deal. In communication with Amnesty International, S-Profit’s director – a Ukrainian national based outside the UK – denied that the firm had supplied military products to South Sudan, but has not responded to further questions, including whether it played an intermediary role.
In response to the report, Ukrinmash published a letter on its website that it claims to have sent to Amnesty International, confirming that the company “signed a contract for the proposed transfer of US$169 million worth of small arms and light weapons to South Sudan.” Amnesty deny ever receiving such a letter, and pointed out that its contents fully support their reports contents, that “negotiations took place, contracts were drawn up and signed, and End User Certificates were obtained from the South Sudanese Ministry of Defence.”
The Amnesty report also reveals that the UK government has, for more than eight years, been aware of UK shell companies being used unlawfully as “contract vehicles” for weapons dealers to supply arms to human rights violators and embargoed destinations including Syria, Eritrea and South Sudan.
For more details, see OCCRP's report: https://www.occrp.org/en/investigations/7037-arms-washing-ukraine-network-moves-embargoed-european-arms-to-africa-and-the-middle-east and Amnesty International: https://www.amnesty.org/en/documents/act30/7115/2017/en/