The ministry said it opened a criminal investigation into the actions of RusHydro chief Vitaly Totrov, accused of embezzling more than $24.2 million.
The Interior Ministry said Totrov used his office to commit fraud through the operations at a hydroelectric plant near the border with Georgia in 2011.
"A criminal case into large-scale fraud has been opened against Vitaly Totrov, general director of the Zaramagskiye hydropower plant," a ministry statement published Thursday by state news agency RIA Novosti said.
RusHydro denied the allegations. A spokeswoman for the company said what the ministry considers fraudulent activity was an "absolute legitimate source of financing."
The Interior Ministry launched a similar inquiry in February, accusing the company of signing false contracts valued at $33.2 million with subsidiaries.
Russian President Vladimir Putin said RusHydro's top management "should be fighting with [their] teeth to recover these funds."
The Interior Ministry said it seized RusHydro's accounting documents in the most recent investigation.