Czech Police Trace Millions in Ukraine’s Missing Ammunition Scandal

Czech organized crime investigators are examining financial transactions linked to a failed €35 million Ukrainian ammunition procurement deal, with new reporting revealing how millions of euros moved through companies in Central and Southeastern Europe before substantial sums were withdrawn in cash in Prague.

The investigation concerns a 2022 contract for 100,000 mortar rounds intended for Ukraine's armed forces. Nearly four years later, only 3,000 rounds have been delivered, according to an investigation published by Czech newspaper Novinky on November 12, 2026.

The Czech National Center Against Organized Crime (NCOZ) has been examining the case for approximately two years. The latest findings provide additional details about transactions involving Ukrainian company Lviv Arsenal, Slovakia's Sevotech and Croatian arms dealer WDG Promet.

The financial trail also extends to Bosnia and Herzegovina, where prosecutors allege that money intended for Ukrainian ammunition was used to acquire assets belonging to the former Vitezit explosives factory.

How the €35 Million Ammunition Contract Unraveled

Ukraine's Ministry of Defense signed the procurement agreement with Lviv Arsenal in October 2022, during a period of exceptionally high demand for ammunition following Russia's full-scale invasion.

The contract covered 100,000 mortar rounds, valued at approximately 855 million Czech koruna, or €35 million at the reported exchange rate.

The Ukrainian ministry transferred the money in advance to Lviv Arsenal, which relied on foreign intermediaries to arrange the purchase and delivery.

One of those intermediaries was Sevotech, a Slovak company licensed to trade military equipment.

According to Novinky, Ukrainian arms trader Oleksii Khoroshaiev helped organize the transaction. Before the war, he had held a senior position at a Ukrainian state-owned arms trading company.

Sevotech owner Ján Hodermarský told the Czech newspaper that Khoroshaiev had been expected to acquire a substantial ownership stake in the business and was heavily involved in organizing the ammunition deal.

The procurement ultimately failed to deliver the contracted quantities. Although 3,000 rounds have since reached Ukraine, approximately 97 percent of the original order remains outstanding.

The limited deliveries also represent a change from earlier reporting, when none of the ammunition had arrived.

€11.3 Million Transferred to Croatian Arms Company

The most significant new findings concern payments made to WDG Promet, a Croatian company controlled by arms dealer Matias Zubak.

According to the investigation, Sevotech transferred approximately €11.3 million to WDG Promet in December 2022.

WDG Promet maintained accounts at Podnikatelská družstevní záložna (PDZ), a credit union operating in Prague.

Banking records examined in the Czech investigation reportedly show that nearly 138 million Czech koruna, equivalent to approximately €5.6 million, was subsequently withdrawn in cash from the company's accounts over several months.

The question of who authorized and carried out the withdrawals remains disputed.

Zvonko Zubak, Matias Zubak's father and a longtime Croatian arms dealer, has denied responsibility for the withdrawals and maintains that signatures attributed to him were forged.

A former cashier at the credit union has challenged that account.

The unresolved dispute over the cash withdrawals has become a central element of the Czech investigation.

Czech Central Bank Revoked Credit Union's License

The financial institution involved in the transactions has separately faced serious regulatory action.

The Czech National Bank revoked PDZ's operating license, with the decision becoming legally effective on January 13, 2025.

In its official announcement, the central bank cited persistent failures in corporate governance, risk management and compliance with anti-money laundering regulations.

The regulator identified systematic violations of legal obligations intended to prevent money laundering and terrorist financing.

Those findings provide important context for the financial institution through which the ammunition-related funds were transferred.

However, the regulatory decision does not establish who withdrew the specific funds associated with the Ukrainian procurement contract or whether the disputed transactions constituted criminal activity.

Investigators Link Ammunition Payments to Bosnia's Vitezit Factory

The case also involves a disputed transaction in Bosnia and Herzegovina.

Ukrainian and Bosnian investigators suspect that approximately €5.5 million originating from the ammunition procurement was used to finance the acquisition of assets belonging to Vitezit, a former explosives manufacturer in the town of Vitez.

The purchase was arranged through WDG Promet, while related proceedings in Bosnia involve WDG d.o.o. Vitez.

The assets included facilities historically associated with nitroglycerin and plastic explosives production.

AdriaDefense previously examined the Ukrainian investigation into the Zubak family's involvement, including the suspected use of ammunition procurement funds for the Vitezit transaction.

The investigation has since developed into separate judicial proceedings.

On September 4, 2026, the Special Department for Corruption and Organized Crime of the Supreme Court of the Federation of Bosnia and Herzegovina formally opened trial proceedings against Behrija Huseinbegović, Josip Rajić, Tomislav Zubak, Nikola Čato and WDG d.o.o. Vitez.

According to the court's official announcement, the charges differ among the defendants and include alleged abuse of office, money laundering and unlawful possession of weapons or explosives.

Tomislav Zubak, another son of Zvonko Zubak, is among those standing trial.

All defendants are presumed innocent unless their guilt is established by a final court judgment.

The Bosnian proceedings concern the acquisition and handling of Vitezit assets and are legally distinct from the criminal prosecution concerning the original ammunition procurement in Ukraine.

Ukrainian Arms Trader Fights Extradition From Czechia

The Czech investigation has also brought renewed attention to Oleksii Khoroshaiev, who was detained by Czech authorities in September 2024 at Ukraine's request.

Ukrainian investigators suspect him of involvement in the alleged embezzlement of procurement funds and the organization of the foreign part of the transaction.

Khoroshaiev is contesting extradition and has applied for asylum in the Czech Republic.

Through his lawyer, Leonid Kushnarenko, he has denied appropriating funds intended for ammunition purchases or participating in their embezzlement.

He has attributed responsibility for handling the disputed funds to Croatian business partners.

Separately, five defendants, including former Ukrainian Defense Ministry officials and representatives involved in the procurement, are already standing trial in Ukraine.

The Security Service of Ukraine (SBU) told Novinky that seven people are being prosecuted in connection with the broader case, with two individuals subject to international searches.

In August, AdriaDefense reported that Ukraine had issued an international wanted notice for Matias Zubak, whose company participated in the procurement chain.

Zubak has denied wrongdoing.

Ukraine Still Waiting for Almost 100,000 Mortar Rounds

A Ukrainian court has ordered Lviv Arsenal to repay the procurement advance. Including contractual penalties, the company's reported financial liability approaches one billion Czech koruna.

It remains unclear how much money the Ukrainian Defense Ministry has recovered.

According to the latest Czech reporting, representatives of Lviv Arsenal are still attempting to locate alternative ammunition supplies to fulfill the outstanding obligations.

The company's director has sought permission to travel abroad to inspect possible ammunition stocks, but Ukrainian courts have rejected requests to return his passport, citing concerns about the risk of flight.

The case underscores the risks associated with wartime military procurement involving advance payments, multiple intermediaries and complex international financial arrangements.

It is separate from the Czech government's multinational ammunition initiative for Ukraine, which operates through a different procurement framework.

For Ukraine, the central problem remains unresolved: most of the ammunition purchased in 2022 has not arrived, while investigators and courts in several European countries continue working to establish where the money went and who bears legal responsibility.

The latest reporting demonstrates how a failed military supply contract can develop into a cross-border financial and criminal investigation spanning the defense industries of Central and Southeastern Europe.