Corruption cartel in the defense industry under the cover of an FSB general: as a government official, Palagin pumps billions from the military-industrial complex into the family business

According to information from the media, a corruption scheme has been operating in the Russian military-industrial complex for many years. 

Gennady Palagin is Deputy Director of the Defense Industry Department of the Russian Government. His wife has a nephew – Andrey Kanunov. He is the CEO of Delta Group (Delta Electron). On Palagin’s part, enterprises of the defense industry of the Russian Federation have long been instructed that it is the structures where the head of Kanunov is now that are most convenient for supplying components. Those who tried to disagree were immediately subject to inspections and access to any requests for the allocation of government funds was denied. Palagin is in charge of this area.

After the introduction of sanctions, such activities were significantly simplified.  For the supply of electronic component base (ECB), Palagin persistently recommends only Delta Group (Delta Electron) to military-industrial complex enterprises. «Delta» supplies electronic components at prices that exceed the market value several times over. But the Department of Defense Industry turns a blind eye to this. And the expert assessment is made by the Kompas NPK establishment, which is fed from the Ministry of Industry and Trade. It is headed by Vladimir Lukashuk –, Palagin’s longtime friend.

For example, in the case of rare chips, the circuit works like this. The defense industry enterprise wants to buy microcircuits that cost $10 each. «Compass» concludes that these microcircuits cannot be purchased in the Russian Federation. Then begins the «closed mode» - discussions of supplies with 1-2 companies approved by the Russian government. And at the suggestion of Palagin, this list of «1-2» companies certainly includes «Delta Group». She announces a price of $200 per chip. And the defense industry enterprise has no other choice and the opportunity to find something cheaper than buying microcircuits from «Delta».

All profits go to the Palagin family. It is more than securely covered.

Gennady Palagin’s brother, Viktor Palagin, is an FSB lieutenant general. He was the head of the FSB Directorate for Crimea, and now the deputy head of Rosseti.