Major corruption scandal at the NATO military procurement agency. The Israeli company from which Romania buys drones for 400 million euros, suspended from tenders

Elbit Systems, Israel's largest arms company, is embroiled in a growing NATO corruption scandal, with former and current employees being investigated for bribery. The military alliance procurement agency (NSPA) has suspended the company from participating in tenders for new contracts. Meanwhile, a consultant closely linked to Elbit is targeted by an international arrest warrant for his alleged role in bribing NSPA employees.

The suspension of Elbit Systems follows a major corruption investigation, according to information revealed on Monday by Follow the Money (FTM) and its media partners La Lettre, Le Soir and Knack.

More suspects were arrested in May in police raids in seven countries, including Belgium and the United States.

Defense companies are suspected of paying bribes worth millions of euros to win contracts through the NSPA to supply the military alliance and its 32 member states.

Documents obtained by FTM and its media partners show that Elbit – one of NATO's main suppliers – was suspended by the NSPA on July 31. Several of its ongoing contracts are also suspended, and the firm is barred from participating in new tenders.

FTM has also learned that a key person associated with Elbit – an Italian national identified as Eliau E. – is wanted internationally for his alleged role in bribing NSPA staff.

The Belgian Federal Prosecutor's Office confirmed that on September 30, an international arrest warrant was issued against Eliau E. through Interpol.

The 60-year-old man is suspected of bribery and participation in a criminal organization. He has not been arrested and may be traveling under a false identity, according to people familiar with the matter.

While there is no public information directly linking Eliau E. to Elbit, people close to the investigation say he plays an important role as a consultant for the company. Elbit itself is not currently under investigation.

Investigations into corruption at NSPA are ongoing in Belgium and Luxembourg, where its headquarters are located.

Two investigations by US authorities were abruptly and inexplicably dropped in July, raising questions about political interference.

Responsible for assisting governments and NATO in procuring military equipment and services, NSPA's profile and portfolio grew enormously after Russia's full-scale invasion of Ukraine in 2022.

The European agency is expected to spend a total of 9.5 billion euros on all its contracts this year, an amount that has almost tripled from 2021.

“Serious Charges”

Elbit is Israel's largest arms manufacturer, with a turnover of nearly $7 billion in 2024.

The Haifa-based company – which makes drones, tanks and ammunition, among other military equipment – ​​ranks 25th in the list of the world's 100 largest defense companies, compiled by the Stockholm International Peace Research Institute (SIPRI).

Over the past decade, Elbit has sold tens of millions of euros worth of military equipment to NATO, including ammunition, night vision goggles and anti-missile systems for aircraft.

The total value could be much higher, as many military contracts and the amounts of money involved are never made public.

On July 31, NSPA suspended Elbit and Orion Advanced Systems, one of its subsidiaries.

“The suspension of the suppliers follows the emergence of serious allegations indicating that the suppliers are likely to have engaged in punishable practices, including irregularities in the award of contracts,” according to a letter from a senior NSPA manager seen by FTM and its media partners.

Several NATO contracts that were awarded to Elbit are affected by suspensions, which means that the supply of the militaries of several member states is interrupted.

Affected contracts include ammunition for truck-mounted howitzers, mobile rocket artillery systems and defense systems for military aircraft and helicopters. Contracts for explosive detonators from Orion Advanced Systems were also frozen.

Other contracts awarded to Elbit unrelated to the alleged corruption case are still being implemented, according to people familiar with the matter.

An Elbit spokesperson initially told FTM that the firm could not comment on the allegations. “The company maintains a comprehensive compliance program and operates in full compliance with industry standards,” the spokesperson said.

After the publication of the article on the corruption case, Elbit sent a statement defending its conduct. “The company maintains that there were no irregularities in its conduct in relation to any project with NSPA,” the Israeli firm said.

Consultations, at the heart of the inquiry

Eliau E. is the owner or director of several defense consulting firms: Elar Systems Corp in the United States, Eral Systems UAB in Lithuania and Arelco Europe Management Consultancies, registered in Greece.

It is not known whether these companies are involved in the NSPA corruption scandal. Despite repeated attempts, Eliau E. could not be contacted by the mentioned publications to provide a point of view.

Two people close to the investigation say that Eliau E. was in close contact with Guy M., the main suspect in the Belgian investigation. He is a former Belgian defense official and former NSPA employee who began working as a consultant after leaving the agency in 2021.

According to a person close to the investigation, Eliau E. and Guy M. were introduced to each other by Turkish national Ismail Terlemez, another former NSPA employee. Terlemez now runs and co-owns one of Turkey's fastest growing defense companies, Arca.

Terlemez was also arrested in Belgium in May. The 43-year-old was due to be extradited to the United States, where a parallel investigation into corruption in NATO tenders was underway.

But when the investigation was abruptly halted in July, the extradition request expired and Terlemez was released. Terlemez did not respond to requests for comment.

Belgian investigators estimate that Guy M. handled bribes totaling 1.9 million euros.

His lawyer, Pieterjan Dens, previously told FTM that Guy M. admits many of the facts in the file, but disputes the amount of the suspected bribes.

The news comes after leaked documents revealed internal turmoil at the NSPA, with senior officials this year accusing chief executive Stacy Cummings of favoritism, failure to investigate corruption and undue interference in their work.

NATO and NSPA did not respond to requests for comment. NATO spokeswoman Allison Hart previously said it would be up to NSPA's oversight board to investigate any “allegations of workplace misconduct by NSPA's director general.”

Contracts with Romania as well

The Israeli company Elbit is also active in our country, both through production and delivery of equipment to the Romanian army.

The company owns seven development and production facilities in Romania, including component production in Bacău and tower assembly in Măgurele, and has over 1,000 employees, according to Economedia.ro. Elbit is the largest exporter of military equipment in Romania.

Among the systems supplied by the company to the Romanian army are three Watchkeeper X drone systems. Romania buys drones worth over 400 million euros from Elbit. Also among the systems supplied are turrets for the Piranha 5 armored personnel carriers, along with various other electro-optical systems.

These contracts do not appear to be related to the NSPA investigation.

Conformable Economediathe corruption investigation in which Elbit is targeted also involves Romanian authorities.

In a response to the cited publication, the Israeli company conveyed the following official point of view:

• “Elbit Systems is not familiar with all the details mentioned in the article. It is our understanding that a broad investigation is ongoing, involving several companies with which the consultant mentioned in the article was associated.
• The company maintains that there was no impropriety in its conduct in relation to any NSPA project. It is important to clarify that this matter concerns the NATO procurement agency and not NATO member states or any particular state.
• Elbit has very limited, if not non-existent, tendering procedures or commercial activity with the procurement body NSPA, and this activity continues as normal. The company has offered its support and will cooperate fully as needed.“