November 3, 2023

US charges several Russian nationals in connection with schemes to evade sanctions

On November 1, 2023, the US Department of Justice announced that charges had been filed against multiple Russian nationals for their efforts to evade sanctions by engaging in a sophisticated procurement scheme on behalf of Russian end-users, including companies in Russia’s defense industry.   According to the DOJ, four individuals were arrested in New York in connection with two separate schemes involving the unlawful procurement of dual-use electronics for entities in Russia, many of which are affiliated with the Russian military.

Following the arrests of Nikolay Goltsev, Salimdzhon Nasriddinov, and Kristina Puzyreva, federal prosecutors recently unsealed a criminal complaint in the Eastern District of New York charging the trio with conspiracy and smuggling offenses for their alleged roles in securing millions of dollars’ worth of dual-use electronics for entities in Russia between January 2022 and October 2023.  Federal prosecutors accuse the defendants of using two Brooklyn-based entities – SH Brothers Inc. and SN Electronics Inc. – to unlawfully obtain sensitive equipment from US manufacturers and then ship them to end users in Russia – equipment that, according to the court filings, have the same make, model and part numbers as equipment that has been seized from Russia weapons platforms in Ukraine.  The defendants allegedly used SH Brothers, in particular, to make approximately $7 million worth of shipments to Russia.  According to the complaint, Goltsev, a resident of Canada, would receive orders from Russian end users and then work with New York resident, Nasriddinov, to acquire the items from US manufacturers.  Goltsev and Nasriddinov would then allegedly ship the items to intermediary corporations located in other countries, including Turkey, Hong Kong, India, China, and the United Arab Emirates, where they were rerouted to Russia.  Puzyreva, a resident of Canada, allegedly conducted financial transactions in furtherance of the scheme.

Following the recent arrest of New York resident Nikolay Grigorev, federal prosecutors also unsealed a four-count indictment in the Eastern District of New York accusing Grigorev of conspiring with Nikita Arkhipov and Artem Olovianniko, both residents of St. Petersburg, Russia, and violating US export control laws in connection with the procurement of dual-use electronic components, including semiconductors, for Russian entities involved in war efforts against Ukraine.  While all three defendants were indicted for their roles in the scheme, the DOJ reports that Arkhipov and Olovianniko remain at large.  According to the indictment, between October 2021 and February 2022, the defendants utilized email and bank accounts associated with Brooklyn-based Quality Life Cue LLC (“QLC) to facilitate the illegal export control scheme and obtain sensitive equipment for SMT-iLogic, an Russia-based entity sanctioned by the US for having a role in the production of military drones used by Russia in its war against Ukraine.

DOJ Press Release | USAO EDNY Press Release | Unsealed Complaint | Unsealed Indictment