Corruption scandal within NATO. The Israeli company that delivers Watchkeeper drones to Romania, targeted by serious accusations

An international investigation brings to light major frauds within NSPA, NATO's procurement agency, targeting contracts worth hundreds of millions of euros awarded to the Israeli company Elbit Systems, from which Romania also purchased Watchkeeper X drones and military equipment.

Romania has several contracts for military equipment with the company targeted by the investigation. PHOTO: MApn

An investigation coordinated by the French publication La Lettre, together with Belgian newspapers (Le Soir and Knack) and the Dutch platform Follow the Money, identified a series of frauds within the NATO Support and Procurement Agency (NSPA). The investigation focuses on Elbit Systems, one of the largest defense companies in Israel, which also supplies military equipment for the Romanian army, including drones and surveillance systems.

Belgian prosecutors have issued an international arrest warrant for Italian consultant Eliau Eluasvili, believed to be the ringleader of the fraud ring, and Elbit Systems has been temporarily suspended from all NATO contracts.

The investigation involves several European states, including Belgium, the Netherlands, Luxembourg, Switzerland and Romania, and targets suspicious transfers of funds, including for fuel supplies for NATO military ships.

Italian Eliau Eluasvili, aged 60, is accused of manipulating NATO contracts for the benefit of Elbit Systems, being suspected of coordinating an international network of consulting firms with headquarters in Lithuania, Florida, the United Kingdom, Greece and Romania.

An international arrest warrant was issued in his name for “acts of corruption and participation in a criminal organization.”

Suspended contracts

The corruption scandal at the level of the NATO agency is much bigger, however, in the spring of this year, five current and former NSPA agents were arrested in several European countries for involvement in contracts regarding the purchase of ammunition and aeronautical equipment valued at hundreds of millions of euros.

According to the sources cited by the La Lettre publication, this summer, NATO took the decision to suspend several contracts awarded to the Israeli company Elbit Systems, as a direct reaction to the wave of arrests that took place between February and May, related to suspicions of corruption and procurement manipulation.

Elbit Systems, one of the most important suppliers of military equipment in Israel, recorded a turnover of 6.8 billion dollars last year.

An internal NSPA email dated July 31 indicated that several contracts had been awarded to “companies involved in fraudulent activities”, reflecting the seriousness of the allegations and the need for a strict assessment of business relationships.

The list of suspensions includes 15 NATO contracts, 13 of which were awarded directly to Elbit Systems and its subsidiary, Orion Advanced Systems. These contracts cover the supply of components for aerial ammunition, conventional ammunition, aircraft flares used by military aircraft and 155 mm shells for various NATO units.

The most valuable of the suspended contracts is a modernization program for the Portuguese navy's offshore patrol vessels, estimated at 100 million euros for the period 2016-2024. A significant part of this contract was awarded to Elbit Systems, and the suspension raises questions about the deliveries and execution of works under the NATO project. Irregularities in the awarding of contracts

“The suspensions of the suppliers come after serious allegations emerged indicating that they are likely to have engaged in punishable practices, including irregularities in the award of contracts. As a result, our current procurement strategy can no longer be implemented.” Céline Danielli, responsible for NSPA's ammunition program, adding, however, that the agency remains open to discussions regarding the operational impact of this decision.

Specifically, the corruption scandal refers to the fact that several former NATO agents, turned consultants, used their experience and contacts to facilitate the obtaining of contracts by Elbit Systems. They often provided detailed information about NSPA's contractual clauses and internal procedures, taking advantage of the unprecedented increase in defense budgets in European states after the start of the war in Ukraine.

At the center of the investigation is Guy Moeraert, a former Belgian soldier who worked between 2015 and 2020 in NSPA's operations department, where he had direct responsibility for ammunition procurement. After this period, Moeraert continued his career as an independent consultant.

Belgian justice suspects Moeraert of having received commissions worth 1.9 million euros, related to munitions programs and aeronautical equipment whose total value amounts to several hundred million euros. He was indicted for active and passive corruption, money laundering and participation in a criminal organization.

His lawyer stated that Guy Moeraert “he put everything on the table, gave names and does not dispute the facts”, pointing out that, in the future, the client benefits from the presumption of innocence. Belgian courts are investigating whether, after becoming an independent consultant in 2021, Moeraert collaborated with Eliau Eluasvili, helping him secure more NATO contracts for Elbit Systems, according to the sources cited.

He is currently on electronic monitoring after serving six months in prison.

Elbit contracts with NATO

Elbit Systems holds numerous highly important NATO contracts. These include:

* Self-protection systems for Airbus Caracal H225M helicopters of the Dutch special forces.

* Electronic countermeasures for C-390 transport aircraft, delivered to Austria and the Netherlands.

* Equipping Airbus MRTT tanker aircraft for eight NATO countries, including Germany, the Netherlands, Belgium and Denmark.

Romania's contracts with Elbit Systems

Romania has signed several important contracts with Elbit Systems, which are part of the program of equipping and modernizing the army:

* Purchase of Watchkeeper X dronescontract worth approximately 180 million dollars.

The deliveries were delayed, citing production and logistics problems of the Israeli company.

* Military equipment and surveillance systems for equipping the Romanian Army, including electronic components, sensors and communications equipment integrated into the NATO program, contract worth approximately 120 million dollars.

* Modernization of IAR 99 Soim aircraft

The contract was signed in 2020 between Avioane Craiova and Elbit Systems and had as its objective the modernization of school and light attack aircraft, including avionics and weapon systems.

In this case too, the deliveries were delayed, and Avioane Craiova indicated the responsibility of the Israeli company.

Involvement of the United States

The investigation highlights a wider network, which would include Ismaïl Terlemez, former NSPA agent and director of the Arca Defense group in Turkey, who was investigated by the FBI for bribery in the case of NATO contracts and arrested on May 13 in Brussels, being released on July 9.

The US Department of Justice dropped the charges just two weeks after the meeting between Donald Trump and Recep Tayyip Erdogan on June 25 at the NATO summit in The Hague.

Political pressures from NATO member countries

The cases of corruption discovered within the NSPA ended up being dealt with at the highest level in the NATO structure, including both military and political components.

The issues were debated on November 19 at the last meeting of the North Atlantic Council, the main political decision-making body of the Alliance. During this meeting, Stacy Cummings, the US director of the NSPA, was summoned to provide detailed explanations of how the agency handles contracts and to clarify the actions taken in the wake of allegations of corruption.

Also, several of the 32 ambassadors of the NATO member states insisted that the institution ensure greater transparency in the procurement process, emphasizing the need to strengthen mechanisms to prevent fraud and ethical violations within the agency.

On November 21, La Lettre published an internal report that revealed that Stacy Cummings, backed by Washington officials, had exerted pressure to limit internal controls and investigations at the NSPA.

The document indicates that these pressures were aimed at reducing the impact of corruption checks, which has raised concerns among representatives of NATO member states, who are calling for concrete measures to guarantee the integrity of procurement processes and restore confidence in the agency.

Elbit Systems position

The company said it has a “comprehensive program of policies to ensure compliance” and has provided NSPA with all necessary support, but that it is “not aware of the details and therefore cannot comment at this stage”.