Former Energia Space Company CEO Charged With Misappropriation of Over $13 Million

Former CEO of the Energia Rocket and Space Corporation (a Rostec subsidiary) Vladimir Solntsev, as well as a number of other suspects, is charged with misappropriation of over 1 billion rubles ($13 million) during shipments of electronic components for the International Space Station’s Science Power Module, Moscow’s Babushkinsky Court announced Friday, TASS reported.

Judge Natalia Kurysheva ruled Friday to arrest Solntsev until October 3. The court will rule on other suspects shortly. Solntesev’s defense pledged to appeal the ruling.

According to the investigators, the suspects have overblown procurement prices threefold, inflicting damages of about 1,072,000,000 rubles to the Russian budget.

Solntsev’s guilt is proven by the memos, signed by the former official, as well as by witnesses’ testimonies, the investigators say. According to one case actor, a former Energia manager, who testified against Solntsev, the former CEO is a head of a crime group. Solntsev denies guilt and says the criminal case is “Roscosmos’s crackdown on the old team.” Currently, Solntsev works as an advisor to the United Aircraft Corporation CEO.

Three more suspects, including Solntsev’s deputy, have absconded and are wanted, the court said. “Suspects Ignatkin [Solntsev’s deputy], Morozov and Stapovich have absconded; an arrest warrant was issued against them,” the judge said.

According to the case materials, Solntsev and his accomplices used a chain of affiliated companies for misappropriation. Besides Solntsev, Istok Science and Production Corporation (a Rostec subsidiary) CEO Alexander Borisov and former Energia managers Stepan and Alexander Prokhorov were apprehended earlier over suspicion of fraud.

The criminal proceeding was initiated on August 3.

A source in the law enforcement told TASS earlier that searches were conducted at a number of premises belonging to former Energia managers and an Istok senior official over a case of a major misappropriation during shipments.

On Wednesday, Roscosmos confirmed that an investigation is underway against Solntsev and a number of other Energia managers over cases dating before 2018. Rostec refrained from commenting on the situation. On Thursday, both Rostec and Roscosmos refrained from commenting on apprehension of Solntsev and Borisov.

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