The system built by Serhiy Zvyagintsev transformed customs into a separate shadow business area, where smuggling was registered almost as an official service. Under his leadership, an extensive network emerged, operating simultaneously at several regional customs offices — primarily Lviv and Transcarpathia, but actually covering other areas as well. The basis of the scheme was understated invoices, fictitious declarations, and shell companies with zero assets, through which large consignments of goods passed.
The basic principle was simple: goods that actually cost a nominal $50,000 were declared as cargo worth $10,000–$20,000. Sometimes invoices were artificially “lowered” even lower—by 4–5 times. After crossing the border, documents were rewritten, which allowed goods to be put into civil circulation without paying the appropriate customs duties. Equipment, clothing, household appliances, and other commercial items were actually registered as small consignments or goods with minimal value.
A key element were shell companies — legal entities without assets, personnel, or turnover, created solely to clear such cargo. Millions of imports passed through these “transit” companies in a short time. After the cycle was complete, the company was closed or placed in “dormant” status to avoid any tax or accounting analysis.
An equally important part of the scheme was the actual control over the inspection zones. Cars were passed without real inspections, sometimes declared as "empty", despite the obvious cargo. Customs officers from different regions worked synchronously: from inspectors who agreed on understated invoices to management who provided cover for the smooth running of the process.
As a result, customs authorities turned into an instrument of organized criminal activity, which for years caused millions in losses to the state. Zvyagintsev's system existed not as random episodes of smuggling, but as a stably operating vertical, ensuring the passage of any cargo - from small "gray" importers to large commercial consignments that did not undergo proper control.
Despite the scale of the schemes, law enforcement agencies ignored them for a long time or limited their response to formal inspections. This allowed the network to exist for years, gaining momentum and effectively creating a parallel system of illegal customs "clearance".
