Russia defence scandal deepens with arrest of new bribery suspect

MOSCOW (Reuters) - The head of personnel at Russia's Defence Ministry has been arrested on suspicion of bribery after more than $1 million in cash and valuables were discovered at his properties, investigators said on Tuesday.

The arrest of Yuri Kuznetsov signals a widening of the biggest government corruption scandal in years, two days after President Vladimir Putin unexpectedly removed Sergei Shoigu from the post of defence minister.

The state Investigative Committee said Kuznetsov was suspected of "receiving a bribe on an especially large scale".

"According to the investigation, in 2021–2023, as the head of the 8th Directorate of the General Staff of the Russian Armed Forces, Kuznetsov received a bribe from representatives of commercial structures for performing certain actions in their favour," the committee said.

At least five people have been arrested in the scandal, starting with the detention of deputy minister Timur Ivanov on the same charge on April 23.

Shoigu was unexpectedly removed from his job on Sunday and assigned to a new role as secretary of Russia's Security Council. He is to be replaced by Andrei Belousov, an economist and former deputy prime minister.

Putin's appointment of Belousov, who has no military background, is seen by analysts as part of a strategy to improve the efficiency of Russia's war economy as its army seeks to push further into Ukraine in the third year of the war.

Judging by the arrests, the strategy includes rooting out corruption in the awarding of huge military contracts.

Unconfirmed reports by two of Russia's influential war bloggers said two more deputy defence ministers had resigned before Shoigu's departure.

CASH, GOLD AND WATCHES

Investigators said searches at Kuznetsov's properties uncovered the equivalent of more than $1 million in roubles and foreign currency, as well as gold coins, watches and luxury items.

Kuznetsov could not be reached for comment. The charges against him and Ivanov, the former deputy minister, carry a jail term of up to 15 years.

Ivanov denies accusations that he received bribes worth $11 million in the form of property services from a construction company in return for contracts.

A Moscow court last week rejected appeals by Ivanov and his friend Sergei Borodin, who is also charged with conspiring to take bribes, against their detention.

The other men arrested were Alexander Fomin, co-founder of a construction company that allegedly provided the bribes, and Anton Filatov, former head of several companies subordinate to the defence ministry, who is suspected of large-scale embezzlement.

(Reporting by Mark Trevelyan; Editing by Bernadette Baum)