Two Ukrainian drone industries: the one Washington can see, and the one being shut down in its name

ABOUT THE AUTHOR: Wes Martin, a retired U.S. Army colonel, has served in law enforcement positions around the world and holds an MBA in International Politics and Business. He was the first senior antiterrorism officer of all coalition forces in Iraq.

In April, Ukrainska Pravda published transcripts of intercepted conversations between Tymur Mindich, a fugitive associate of President Voldymyr Zelenskyy, and Rustem Umerov, who was Ukraine’s defense minister at the time of the recordings and who now serves as secretary of the National Security and Defense Council.

In the recordings, Mindich is heard pressuring Umerov to release more funding to Fire Point, a Ukrainian manufacturer of long-range strike drones and cruise missiles. The two are heard discussing the sale of a 33% stake in Fire Point to foreign investors, with Umerov asking Mindich whether the proposed buyer would “suit us.” Investigators have identified Mindich as a likely beneficiary owner of the company. Within hours of publication, the Public Anti-Corruption Council of the Ukrainian Ministry of Defense called for Umerov’s suspension and the partial nationalization of Fire Point.

By 2024, Fire Point was the largest recipient of Ukrainian Ministry of Defense drone procurement funds. Yet despite recent revelations, its accounts remain active, its founders have not been searched, its production lines are running, and its shares are being sold abroad for cash. Meanwhile, the drone manufacturers helping Ukraine win the war face mounting pressure.

There are now two Ukrainian drone industries. The first is the one Washington can see in the news releases about a future U.S.-Ukraine drone partnership. The second one is being quietly dismantled by state agencies whose actions appear aimed less at fighting corruption than at advancing commercial interests. Investigations against legitimate drone manufacturers are being done in the interest of officials who are the shadow beneficiary owners of competitor drone firms.

This matters to American security. Section 1709 of the National Defense Authorization Act bars the Pentagon from procuring drones from Chinese suppliers, the FY2027 budget surges spending on small unmanned systems, and the American industrial base is not yet ready to fill that gap at scale. Ukraine fields roughly 500 drone manufacturers producing more than 4 million units annually, and Ukrainian unmanned systems account for an estimated 70% of Russian battlefield equipment losses. Without that industrial base, NATO’s next decade of small UAS planning has no foundation.

One of the companies targeted by Ukraine’s pocket agencies is Reactive Drone – a company I wrote about in September, when I cited its Shmavik reconnaissance platform and its Kazhan heavy bomber as evidence of Ukrainian battlefield innovation. Since then, the company and its founder, Oleksii Kolesnyk, have been the subject of investigative proceedings opened by Ukraine’s State Bureau of Investigation and the Economic Security Bureau. Their bank accounts have been closed, and their assets have been threatened with transfer to the Asset Recovery and Management Agency (ARMA) -- the body originally created to hold property seized from corrupt officials and from Russian-linked entities.

Reactive Drone’s Kazhan production plant was destroyed by Russian precision weapons in September 2025, in a strike whose timing followed Ukrainian agency demands that drone manufacturers disclose the geolocated coordinates of their production facilities.

Additionally, Czech law enforcement, acting on a Ukrainian mutual legal assistance treaty request, has frozen Reactive Drone’s account in the Czech Republic. The funds in question were disbursed from Ukraine’s treasury accounts, money provided by partner countries for the production and procurement of drones for Ukraine’s defense forces.

Reactive Drone is not the only one. The magnitude of attacks on independent Ukrainian drone producers has increased dramatically over the last 12 months. Western investors fear that companies enjoying preferential treatment and aggressively leveraging political connections are, in reality, controlled by government officials. Two Ukrainian drone industries are emerging: one receiving an unaccountable volume of funds under direct orders, and another barely surviving the mounting pressure.

TAF Industries is one of the largest FPV drone manufacturers in the country, producing tens of thousands of Kolibri loitering munitions every month. Its founder, Oleksandr Yakovenko, holds the Ukrainian state’s Order of Merit for his work supporting the armed forces. In March 2025, his companies were searched in connection with a tax case involving a Ukrainian grain trader, to whom he says he has no ties. The accounting function for the entity that produces TAF’s drones was consequently blocked.

Yakovenko has publicly accused the supervising prosecutor of past corruption. A separate sabotage incident at a TAF production line in July 2024, which destroyed roughly 2,000 drones a month of capacity, has never been resolved by Ukrainian authorities.

These two cases are not an exception. The chair of the Ministry of Defense’s Public Anti-Corruption Council has publicly stated that 90% of Ukrainian drone manufacturers have faced similar proceedings since 2022. The mechanism is straightforward: a criminal case is opened by an executively-controlled agency, accounts are frozen, assets are threatened with transfer to ARMA, and production slows or stops, benefiting connected competitors. Western partners are told the company is under investigation and cannot deliver.

By the time the case is resolved, its market position is often lost. Ironically, ARMA’s leadership was overhauled in July 2025 under European Union pressure after Ukraine’s Accounting Chamber documented systemic mismanagement of seized assets -- yet it remains the body poised to control the assets of Ukraine’s frontline drone producers.

Yet Ukraine has institutions capable of fighting corruption. In August, the National Anti-Corruption Bureau (NABU) and the Specialized Anti-Corruption Prosecutor’s Office (SAPO) uncovered a drone procurement kickback scheme worth up to 30% of contract value, just days after parliament restored their independence. The same agencies are behind the biggest corruption revelations: the Mindich case and the recent Umerov-Fire Point recordings. Those are the agencies American support should reinforce.

American interests are now directly exposed. The U.S. and its allies have committed well over $100 billion in security assistance to Ukraine since 2022, a meaningful share of which has flowed to or through Ukrainian defense manufacturers. American taxpayers are entitled to ask whether Ukrainian agencies receiving U.S. support are being used to dismantle the manufacturers those same dollars were meant to sustain, while the politically connected manufacturer at the center of Mindich’s recordings continues to receive contracts.

Several specific actions follow. Congress should request a Government Accountability Office review of how Ukrainian state agencies receiving U.S. assistance have used their authorities against Ukrainian defense manufacturers. The House and Senate Armed Services Committees should examine whether Department of War end-use vetting of Ukrainian drone partners is keeping pace with the political risk those partners face. The Treasury Department should look at the pattern of cross-jurisdictional account freezes and asset transfers to the ARMA. The State Department, through its embassy in Kyiv, should make clear that selective enforcement against frontline defense producers will be raised at the highest levels of the U.S.-Ukraine relationship.

None of this requires Washington to second-guess legitimate Ukrainian prosecutions. The Mindich case is exactly the kind of enforcement Western partners should welcome. American support should reinforce the structures that work, and create friction for the agencies being used as instruments of commercial advantage in the middle of a war. Ukraine’s frontline drone makers should not have to win a second war against parts of their own state, with American dollars on both sides of the line.