On February 12, 2024, Kristina Puzyreva, a Russian national residing in Canada, pleaded guilty to one count of money laundering conspiracy in the U.S. District Court for the Eastern District of New York. According to the indictment, Puzyreva and co-defendants used a Brooklyn, New York front company, SH Brothers Group, Inc., to purchase U.S.-sourced electronics based on orders received from alleged co-conspirators in Russia. The electronics included items that required export licenses issued by the Bureau of Industry and Security of the U.S. Department of Commerce; no such licenses were obtained, although the equipment was intended to be sent to Russia and incorporated into unmanned aerial vehicles and missiles used by Russia in the war against Ukraine. The indictment describes how the U.S.-sourced electronics were received at several different addresses in Brooklyn, repackaged, exported and transshipped to Russia through intermediary companies in Turkey, Hong Kong, China, India, the United Arab Emirates, and elsewhere. Thus, according to the court documents, the material misrepresentations and omissions of Puzyreva and her co-defendants caused U.S. companies to sell and export electronic components in violation of the Export Control Reform Act (“ECRA”), 50 U.S.C. § 4801 et seq., which establishes the authority for the Export Administration Regulations (“EAR”), Title 15 C.F.R. Parts 730-774, and to process and accept payments in furtherance of the illicit transactions. Additionally, according to the indictment, the actions of Puzyreva and her co-defendants caused U.S. financial institutions to process millions of dollars in violation of various U.S. laws and regulations.
Specifically, between August 2022 and September 2023, as detailed in the indictment, SH Brothers Group Inc. exported over 250 shipments worth more than $7 million to intermediary companies outside of Russia, to be re-shipped to Russia for military use. Thousands of dollars in cash were deposited in Brooklyn ATMs into the bank accounts of Puzyreva, and then transferred to Canada for Puzyreva’s use.
The indictment charges Puzyreva, her husband Nikolay Goltsev, and five other co-defendants, with:
- Conspiracy to commit money laundering by knowingly and intentionally conspiring to transport or transfer monetary instruments or funds from within the United States to a location outside the United States, and by conspiring to engage in monetary transactions with criminally derived property, in violation of 18 U.S.C. §§ 1956(h) and 3551, et seq;
- Conspiracy to defraud the United States by using deceitful and dishonest means to impair, impede, obstruct and defeat the issuance of export licenses, in violation of 18 U.S.C. §§ 371 and 3551, et seq;
- Wire fraud and conspiracy to commit wire fraud, in violation of 18 U.S.C. §§1349, 2, and 3551, et seq;
- Conspiracy to violate ECRA;
- Smuggling goods from the United States, in violation of 18 U.S.C. §§ 554(a), 2 and 3551, et seq, and;
- Failure to file, and false filing of electronic export information, in violation of 13 U.S.C. § 305(a)(1) and U.S.C. 18 §§ 2 and 3551, et seq.
Puzyreva pleaded guilty to the money laundering conspiracy charge only. She is currently scheduled to be sentenced on September 30, 2024; however, her attorney has requested an earlier sentencing date.
Press release (February 2024) | Press release (October 2023) | Indictment