Moscow ( CNN ) -- Russia 's president fired the country 's defense minister Tuesday after his office became embroiled in a controversy involving alleged corrupt property deals , state media reported . Anatoly Serdyukov , a former businessman , had been in charge of the Defense Ministry since early 2007 . Putin appointed Sergey Shoigu , a former Emergencies Minister , as the new head of defense , according to Russia 's state-owned channel RT . Shoigu , who 's been serving as governor of the Moscow region since the summer , was well regarded in his role at the helm of the Emergencies Ministry , the channel said . Russia 's Investigation Committee has filed a court case against a company affiliated to the Defense Ministry , Oboronservis , over the sale of ministry properties , according to RT . Two suspects , Yekaterina Smetanova and her partner Maksim Zakutailo , are accused of aiding illegal sales . Another suspect , Yevgeniya Vasilyeva , is thought to be a former protege of Serdyukov , RT said . The scandal , which must be embarrassing for the Kremlin , concerns real estate scams involving nearly $ 100 million , according to state-owned news agency RIA Novosti . `` Given the situation that has developed around the Ministry of Defense , in order to create the conditions for an objective investigation of all the issues , I have decided to free the Minister of Defense Serdyukov from office , '' Putin is quoted as saying by RT . Russia 's large military is in the midst of a much-needed modernization program . Putin urged Shoigu to push forward with the reforms , according to RT , saying he `` must continue further dynamic development of the army to ensure the fulfillment of the state arms order and the immense plans of re-equipment of the army . '' The appointment of Shoigu , a general , in place of Serdyukov , who was Russia 's first civilian defense minister , may please senior military figures who 've been unsettled by sometimes painful reforms . The modernization program was ordered after Russia 's invasion of the former Soviet republic of Georgia in 2008 revealed unexpected weaknesses in its armed forces . CNN 's Arkady Irshenko contributed to this report .
Defense Minister Anatoly Serdyukov is sacked as a scandal embroils his ministry -- state media . Sergey Shoigu , a former Emergencies Minister , is the newly appointed head of defense . Putin said he was sacking Serdyukov to ensure an objective investigation , state media report . Russia 's large military is in the midst of a much-needed modernization program .