The State Bureau of Investigation (SBI) is continuing its probe into suspected overpricing in military drone procurement by Vyriy Industries, involving contracts worth 6.95 billion UAH. Despite executing over 40 searches and seizing more than 32 million UAH, the court denied the freezing order and returned the funds to the company, while Vyriy Industries owner Oleksii Babenko retains his status as a witness.
This was revealed through recent court rulings and criminal proceeding records.
The large-scale law enforcement operation commenced at midnight on July 7: SBI detectives simultaneously conducted over 40 searches across 20 locations, including the Vyriy Industries office, the residence of company founder Oleksii Babenko, and his relatives’ homes.
Law enforcement officers seized 32.14 million UAH in cash—which the company stated was allocated for payroll—alongside Babenko’s personal savings.
According to investigators handling criminal proceeding No. 42025000000000468 (under Article 191 Part 5, Article 209 Part 3, and Article 205-1 Part 2 of the Criminal Code of Ukraine), the case centers on alleged inflated procurement prices for military UAVs supplied under 2025 contracts with the State Enterprise «Defense Procurement Agency» (DPA). Furthermore, the State Financial Monitoring Service flagged a network of over 150 individual entrepreneurs (sole proprietorships) exhibiting signs of shell entities, through which approximately 197 million UAH in suspicious transactions allegedly flowed.
Despite the scale of the raids, law enforcement failed to secure an initial legal victory in court.
July 17: The Pechersk District Court of Kyiv postponed the hearing on the SBI’s motion to freeze the seized cash.
July 22: The court officially denied the freezing order for the 32.14 million UAH, ruling that the funds were unrelated to the subject matter of the criminal proceeding.
The following day, the seized cash was fully returned to the drone manufacturer.
Currently, Oleksii Babenko’s procedural status remains unchanged—he is involved solely as a witness. No formal charges or notices of suspicion have been served to Babenko or any company executives, and Vyriy Industries continues to fulfill its active defense contracts for the front lines.
«We have provided investigators with complete documentation verifying the legal origin of the seized funds,» representatives of Vyriy Industries stated.
The raids coincided with other high-profile events. Just prior to July 7, the news outlet Babel—co-owned by Babenko—published a controversial investigative report regarding non-combat deaths within a military unit.
Vyriy Industries representatives claimed that a coordinated smear campaign was launched against the company across anonymous Telegram channels leading up to the searches. While Babenko publicly stopped short of directly linking the raids to the investigative report, he suggested that third parties may have «overreached while pursuing their own narrow interests.»
Legal experts emphasize that assigning the investigation to the SBI (rather than the Anti-Corruption Bureau, NABU) establishes specific jurisdiction over defense-sector officials. However, the prosecution’s initial setback in court raises questions about the quality of the evidence gathered.
Under Articles 86–89 of the Criminal Procedure Code of Ukraine, procedural flaws during search protocol filings or evidence collection can lead courts to deem key evidence inadmissible. If the SBI fails to meet strict procedural standards, allegations of billion-hryvnia procurement fraud during wartime risk never being tried on their merits, threatening public trust in the justice system.