Russian authorities have placed businessman Mkrtich Okroyan, president of the Auri Group of Companies, under pre-trial arrest in absentia after uncovering a large-scale fraud linked to the supply of fake parts for military aircraft. The case revolves around defective bearings fitted into Il-76MD-90A military transport planes, which are key to Russia’s air operations.
Investigators claim that Okroyan’s company, the Balashikha Foundry and Mechanical Plant (BLMZ), delivered poor-quality bearings under a state defence contract. These substandard components reportedly caused failures in five aircraft, grounding them and creating safety risks.
The total financial loss to the government has been estimated at over 229 million rubles (around $2.8 million). The Tverskoy Court of Moscow approved Okroyan’s arrest and ordered an international search, as he is believed to be living abroad, mainly in the United Kingdom.
Okroyan has been charged under Article 201.1 of the Russian Criminal Code for abuse of authority in executing a state defence contract. The case has attracted significant public attention because it involves military funds, national security concerns, and corruption within a major defence contractor.
Family link uncovered in the investigation
The criminal case was first opened in June 2025, when investigators detained Nikogos Okroyan, a 43-year-old relative of Mkrtich Okroyan and the chief engineer at BLMZ. He was accused of embezzling government funds intended for manufacturing aircraft components.
Between 2020 and 2023, BLMZ received millions of rubles from the Russian Ministry of Defence to produce 64 aircraft wheels for the Il-76MD-90A. Instead of using approved materials, investigators allege that counterfeit components were used in the production process.
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This resulted in mechanical failures and grounding of five aircraft, causing what officials described as “significant harm to the legally protected interests of the state”.
As the investigation progressed, authorities discovered that Nikogos Okroyan’s actions were closely coordinated with Mkrtich Okroyan, who served as both a shareholder and president of the parent company. Due to their direct connection, the Investigative Committee of Russia merged both cases into one major fraud investigation.
Mkrtich Okroyan is now accused of planning and supervising the misuse of funds, while his relative allegedly carried out the technical and financial operations that allowed the fraud to take place.
Shell companies and secret money flow
Investigators traced the movement of funds and uncovered a complex network of shell companies reportedly controlled by Mkrtich Okroyan’s Auri Group of Companies. These included Avangard Art LLC, Sanrivers LLC, Kantina LLC, and Domino LLC, which appeared to be legitimate suppliers on paper but had no real production activity.
Authorities believe these companies were used to create fake invoices and contracts, allowing money from the state defence budget to be transferred into private accounts. The transactions were disguised as supplier payments, making them difficult to detect during audits.
Documents reviewed by investigators show that these firms operated under the full control of Auri Group management, which included Mkrtich Okroyan and his immediate family. The network allowed the group to move funds freely between related companies while maintaining the appearance of legal business activity.
Financial analysts assisting investigators reported that around 165 million rubles (about $2 million) were illegally withdrawn from circulation through these shell operations. The funds were later used for private purposes, including luxury property development.
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Lavish lifestyle and foreign assets revealed
While most of Mkrtich Okroyan’s companies were based in Russia, authorities discovered that he had been living mostly in the United Kingdom for the past few years. In 2020, Okroyan and his family purchased a luxury home in Surrey, one of England’s most expensive regions.
Back in Russia, the Federal Security Service (FSB) and tax authorities found evidence that almost 100 million rubles (about $1.25 million) from government contracts had been diverted to build luxury homes for Okroyan and his relatives in the Moscow region. These homes were allegedly funded using money that was supposed to pay legitimate suppliers.
The investigation also revealed that the Auri Group, led by Mkrtich Okroyan, owned several companies tied to defence manufacturing and industrial machinery production. Many of these firms had received government contracts over the years. The discovery that they were involved in supplying fake and unsafe aircraft parts has caused outrage and embarrassment within the Russian defence industry.
Authorities have issued an international warrant for Mkrtich Okroyan’s arrest. His pre-trial detention order in absentia allows law enforcement abroad to detain him if found.
The ongoing probe has become one of the most significant corruption cases in Russia’s recent history, highlighting issues of accountability, financial oversight, and misuse of public funds in sensitive defence projects. Investigators continue to examine financial records and company accounts to trace all parties involved.