Ukraine’s anti-corruption agencies have named former presidential chief of staff Andriy Yermak as an official suspect in a 460-million-hryvnia ($10.5 million) money-laundering scheme, the Associated Press reported Tuesday, marking a significant escalation in a graft investigation that has shaken President Volodymyr Zelenskyy’s government.

The National Anti-Corruption Bureau and the Specialized Anti-Corruption Prosecutor’s Office announced the development late Monday on Telegram, stressing that the investigation is ongoing and that Zelenskyy himself is not under suspicion, according to the AP.

Yermak, who resigned in November amid the unfolding scandal, had served as Zelenskyy’s lead negotiator in talks with the United States and was widely regarded as one of the most powerful figures in the Ukrainian government. The naming of a suspect falls a step short of formal charges and a decision on whether to file charges could still take months, according to the report. 

The investigation, centered on a luxury real estate development near the capital, has ensnared other senior figures. Rustem Umerov, head of Ukraine’s National Security and Defense Council and a key participant in U.S.-brokered peace diplomacy, has been questioned and is a witness in the case, prosecutors told reporters in Kyiv. 

Former Deputy Prime Minister Oleksii Chernyshov and prominent Ukrainian businessman Tymur Mindich are also “implicated,” according to prosecutors cited by the AP. The broader graft case extends into Ukraine’s energy sector, the defense industry, and the procurement of drones and other military equipment.

The scandal represents the most serious domestic challenge to Zelenskyy’s wartime leadership since Russia’s full-scale invasion in 2022, the AP noted, and complicates Ukraine’s bid for European Union membership, with endemic corruption among the obstacles slowing accession. Investigators searched Yermak’s home in November, the AP reported. Zelenskyy had previously resisted repeated calls to replace his longtime confidant.