Investigations by military prosecutors revealed the deal to be not just corrupt, but fake from beginning to end.

First of all, the company itself, Zvezdochka, turned out to be a shell company that was impersonating the real Zvezdochka ship repair yard, which specializes in the modernization and repair of nuclear and diesel submarines. The fake Zvezdochka that won the contract and received the funds did not even have proper permits from the Russian state atomic energy corporation, Rosatom, to repair the nuclear reactor on the cruiser. The doppelganger shell company had, nonetheless, been winning contracts to “repair” the reactors of nuclear submarines for years, despite not having any suitable facilities for carrying out such work.

Unsurprisingly, and perhaps fortunately, the supposed repair work was never carried out—and, it turned out, was never necessary in the first place.

A large proportion of fake-Zvezdochka’s employees were relatives of the company’s Director, and received large salaries and bonuses paid for by Russian state defense procurement orders, presumably for no actual work.

How a company that did not actually do any work was able to continue winning contracts for so long is not entirely clear, but Chief Military Prosecutor Sergei Fridinskiy hinted that it is likely that the Ministry of Defense officials that covered this scheme, by signing the contracts and approving fraudulent reports about fulfilled work, also benefited.

Finally, to add insult to injury, the fake company overcharged for the work that was supposed to be carried out, which according to military prosecutors should have been valued at RUB 265.4 million (USD 8.6 million). Indeed, the inflated fee was the initial focus of the investigation.