Russian President Vladimir Putin has fired Defense Minister Anatoly Serdyukov and named a former emergency situations minister to replace him.
The move comes two weeks after a criminal probe was opened into alleged fraud in the sell-off of military assets at a company controlled by Russia’s Defense Ministry.
Putin explained his decision during a televised meeting on November 6 with Moscow regional Governor Sergei Shoigu, whom he also named as Serdyukov's replacement.
"You know about the situation that has unfortunately unfolded at the Defense Ministry," Putin said. "In order to create the necessary conditions for an objective investigations of all the issues in this regard, I have decided to dismiss Defense Minister Anatoly Serdyukov from his post."
Last week, Russia's Investigative Committee announced a fraud investigation into the operations of Oboronservis for fraudulent property and share sales.
The Investigative Committee said the state had suffered damages of 3 billion rubles ($95 million).
Until last year, Serdyukov oversaw Oboronservis. The company has wide-ranging operations, from weapons maintenance to agriculture and publishing.
His dismissal comes at a time when Russia is planning to significantly boost military spending.
Putin said that Shoigu should be able to fulfill those plans.
"The future chief of one of the most important agencies in our country should be a person who could carry on all the positive accomplishments of recent years, ensure the dynamic development of the armed forces, ensure the implementation of state [defense] contracts, and those grand rearmament plans that we have," Putin said. "I think, therefore, that you could be this person."
Shoigu was Russia's emergency situations minister between 1994 and 2012, including during a disastrous fire season in 2010, when dozens of deaths and a virtual shutdown of the capital under a smoky haze prompted heavy criticism of the official response to the blazes. He was appointed to the key post of Moscow region governor in May.
Shoigu is a former member of Boris Yeltsin's cabinet who frequently polls among the country's most popular politicians.
Serdyukov had served as Russia's defense minster since February 2007.
With reporting by RIA Novosti, Interfax, Reuters, AFP, and AP