U.S. authorities have charged a group of Russian and Venezuelan citizens with their involvement in a scheme to bypass Western sanctions and allow money laundering on a global scale. They were accused of procuring military technology from American companies, smuggling crude oil and concealing money flows to Russian oligarchs via shell companies and crypto transactions.
Russians in Europe Arrest for Shipping Oil and Dual-Use Technology Violations of Sanctions
Two Venezuelans and five Russian citizens were charged with violations in connection to the purchase and sale of U.S.-made dual-use and military equipment for Russian buyers. They also shipped Venezuelan oil in violation of restrictions. Federal prosecutors claim that some of the electronic parts ended up in Russian weapons systems taken on the battlefield in Ukraine.
The U.S. Department of Justice announced Wednesday that a 12-count indictment had been filed in Brooklyn federal court.
Yury Orekhov and Artem Uss are facing charges of money laundering and global procurement.
The United States is currently seeking the extradition of Orekhov (‘Juanfe Serrano’) and Uss (‘Juanfe Serrano’), who were detained in Germany or Italy. Juan Fernando Serrano Ponce, ‘Juanfe Serrano,’ and Juan Carlos Soto, both Venezuelans were also arrested. As part of the scheme, the two were accused of brokering illicit oil deals for Petroleos de Venezuela S.A. (PDVSA), a Venezuelan state-owned oil firm. Breon Peace, U.S. attorney for the Eastern District in New York, elaborated on the charges:
The defendants are accused of being criminal enablers of oligarchs. They orchestrated a complex scheme for illegally obtaining U.S. military technology, Venezuelan sanctioned crude oil, and a multitude of transactions involving cryptocurrency and shell companies.
Jonathan Carson, Special Agent-in-Charge at the U.S. Department of Commerce Office of Export Enforcement stated that “We will continue enforcing the unprecedented export controls in response to Russia’s illegal war on Ukraine”
U.S. officials claim that the defendants used a German registered entity to transport the goods. Yury Orekhov was part owner and chief executive at Nord-Deutsche Industrieanlagenbau GmbH GmbH (NDA) in Hamburg, whose main activity was commodity trading and industrial equipment.
NDA was used as a front company by the Russians to source and acquire sensitive technologies, such as microprocessors for fighter aircraft, smart munitions and radar systems. These items were then sent to Russian Federation end users, which included sanctioned companies that work with Russia’s defense sector.
Orekhov and Uss also used the same entity to smuggle hundreds of millions of barrels of oil from Venezuela for Russian and Chinese customers. The aluminum company of a Russian oligarch, subject to sanctions, and a Beijing-based oil & gas conglomerate, are two examples.
Venezuelans brokered the deals between PDVSA & NDA. Millions of dollars worth of transactions were routed through various shell companies and bank accounts. According to the DOJ, the participants used crypto transfers and cash drops in Russia and Latin America to carry out the transactions and laundering the proceeds. The announcement stated that the defendants could be sentenced to up to 30 years imprisonment if convicted.
