MOSCOW, January 16 - RAPSI, Diana Gutsul. The Khamovnichesky District Court in Moscow has confirmed that Nikolai Ryabykh, a high-ranking Defense Ministry official, has been arrested for his involvement in the recently infamous Oboronservice defense holding case, the court's press secretary, Darya Lyakh, told RAPSI.

"Ryabykh is suspected of involvement in a large-scale fraud operation. The court has ruled to detain him until March 14, 2013, because it is believed that he may try to impede the investigation, or go into hiding," Ms. Lyakh said.

Nikolai Ryabykh is acting head of the Defense Ministry's maintenance and administration department.

The Chief Military Prosecutor's Office reported in December 2012 that 288 million rubles ($9.5 million) had been embezzled in Ryabykh's department. In 2010, the department signed a contract with the Security and Communications firm following a tender where the conditions ruled out the victory of any other bidder, the prosecutors say. The price of the contract was overstated by 288 million rubles.

In October, investigators announced that five fraud cases had been launched on the sale of the property, land, and shares belonging to Oboronservis, a holding company under the ministry's control. The losses involved were thought to be in excess of 3 billion rubles ($97.3 million). Later, it was reported that the damages have exceeded 6.7 billion rubles ($217.3 million).

Oboronservis consists of service companies involved in armaments and military vehicle repair and maintenance, construction materials and food production, power facilities operation, cartography and printing goods production, and housing services for military towns.