Despite the sanctions, Russian residents still find opportunities for illegal cooperation. Millions of dollars worth of semiconductors, integrated circuits and other dual-use electronic components were illegally exported to Russia through shell companies in Brooklyn, according to the portal. justice.gov.
On October 30, a criminal investigation was unsealed in Brooklyn charging Nikolai Goltsev, Salimjon Nasriddinov, and Kristina Puzyreva with conspiracy and other charges related to a global procurement scheme on behalf of sanctioned Russian entities, including companies associated with the Russian military.
Some of the electronic components and integrated circuits supplied by the defendants were found in Russian weapons platforms and signals intelligence equipment captured in Ukraine.
Nasriddinov, who has dual citizenship of Russia and Tajikistan, was arrested in Brooklyn. Goltsev and Puzyreva were arrested at a hotel in Manhattan when they showed up for a meeting with Nasriddinov in New York.
“The defendants evaded sanctions by supplying Russia with equipment needed for precision-guided weapons systems, some of which was used on the battlefield in Ukraine,” said U.S. Attorney Mir. “Individuals and businesses in the Eastern District should know that our office will use all available tools to prosecute those who circumvent sanctions by helping hostile states.”
Complex criminal network
U.S. Attorney Mir thanked U.S. Customs and Border Protection and the Department of Justice's Office of Foreign Affairs for their valuable assistance in the investigation.
“With these defendants in U.S. custody, we have disrupted a complex procurement network that was used to purchase critical technology for the Russian military's advanced weapons systems,” said Assistant Attorney General Matthew G. Olsen of the Justice Department's National Security Division. . “The Department of Justice is committed to bringing accountability and exposing the tactics used by hostile states to illegally purchase the goods they need to continue their brutal campaigns.”
These defendants allegedly illegally exported millions of dollars worth of electronics to support the Kremlin in its ongoing attacks on Ukraine. Over the course of a year, this criminal organization circumvented American sanctions and laws, managing to send more than 300 shipments of prohibited goods worth about $10 million to the Russian battlefield.
“This illegal activity would have continued if not for the collaborative efforts of law enforcement that led to today's charges,” said Ivan Arvelo, Special Agent in Charge of Homeland Security Investigations in New York. “HSI New York remains committed to using its unique powers to relentlessly pursue individuals who seek to exploit U.S. export control laws for financial gain.”
“It does not matter whether these networks use front companies or transport these goods through intermediaries in Turkey, Hong Kong, India, China and the United Arab Emirates. The final destination is Russia. We will use all our tools to hold these actors accountable,” said Matthew S. Axelrod, Assistant Secretary of Commerce for Export Control Enforcement.
Complex criminal network
The defendants were allegedly part of a global procurement scheme aimed at circumventing US sanctions and export controls. This case once again demonstrates Russia's willingness to ignore US laws by using illegal procurement networks to supply its armed forces. “The FBI in New York and our partners will prosecute anyone who attempts to purchase sanctioned equipment. This is a national security issue,” said James Smith, assistant director of the FBI.
To implement this scheme, the defendants used two legal entities registered in Brooklyn - SH Brothers Inc. and SN Electronics Inc. These companies illegally sourced, purchased, and shipped millions of dollars of dual-use electronics from U.S. manufacturers to sanctioned end users in Russia.
Many of the electronic components and integrated circuits supplied by defendants through SH Brothers were, according to the Commerce Department, “of greatest concern due to their critical role in the production of advanced Russian precision weapons systems, Russia's lack of domestic production, and the limitations of global manufacturers.”
As stated in the statement of claim and other court documents, certain electronic components and integrated circuits with the same make, model and part number, supplied by the defendants through SH Brothers, were found in captured Russian weapons platforms and signal reconnaissance equipment in Ukraine.
Including in the Torn-MDM electronic intelligence complex, the RB-301B Borisoglebsk-2 electronic warfare complex, the Izdeliye 305E light multi-purpose guided missile, the L370 Vitebsk anti-aircraft missile system, Ka-52 helicopters, unmanned aerial vehicles Orlan-10 UAVs, T-72B3 battle tanks. SH Brothers has made hundreds of deliveries to Russia worth more than $7 million.
Goltsev received orders from the Russian defense and technology sector who wanted to buy a particular product or part from the United States. Goltsev then contacted American manufacturers and distributors directly, usually using the aliases “Nick Stevens” or “Gio Ross.”
Nasriddinov and Goltsev purchased electronic components from American manufacturers and distributors under the auspices of SH Brothers and SN Electronics and arranged for them to be shipped to various locations in Brooklyn. Nasriddinov and Goltsev then illegally transported the goods to various intermediary companies located in other countries, including Turkey, Hong Kong, India, China and the United Arab Emirates, from where they were redirected to Russia. Puzyreva managed numerous bank accounts and conducted financial transactions as part of this scheme.
Ignorance of the law is not an excuse
The participants in this scam were well aware that the goods had potential military applications. For example, during an exchange of messages between Nasriddinov and Goltsev between November 8, 2022 and November 15, 2022, on or about November XNUMX, XNUMX, Goltsev commented that shipments to Russia had become “dangerous” and spoke about a shipment of electronic components being detained by US officials at John F. Kennedy International Airport in Queens, New York. Nassridinov responded that “the Ukrainians claim that they are being bombed with parts from an American manufacturer, maybe that’s why they started to investigate everything.”
In another post, Goltsev commented that “in the future, we will need to load cargo from several companies so as not to attract attention. For now, big packages are dangerous until we understand what exactly they have figured out. We will need to think about diversifying the cargo so that not everything moves from the same deck.”
In a message dated February 23, 2023, Nasriddinov wrote to Goltsev: “Happy Defender of the Fatherland Day,” referring to a holiday celebrated in Russia and some countries of the former Soviet Union to honor those who served in the armed forces. Goltsev replied: “Happy holiday to you too, my friend, we are protecting it as best we can.”
Defendants are presumed innocent until proven guilty
The investigation was coordinated with the participation of the Disruptive Technology Strike Force, as well as the Justice Department's Task Force KleptoCapture.
The Disruptive Technology Strike Force is a multi-agency law enforcement strike force, jointly led by the Departments of Justice and the Departments of Commerce, designed to prosecute illicit actors, protect supply chains, and prevent critical technologies from falling into the hands of authoritarian regimes and hostile states.
Task Force KleptoCapture is an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export restrictions, and economic countermeasures imposed by the United States along with allies and partners in response to Russia's unprovoked military invasion of Ukraine.