Russian Nationals Arrested Over Alleged Scheme to Evade U.S. Sanctions
The alleged scheme, which has led to arrests in Germany and Italy, involved illicit transactions in oil and military equipment
Two Russian nationals were arrested for allegedly using their Germany-based company as a front to move black market oil and sensitive equipment with military uses in defiance of U.S. sanctions.
Yury Orekhov and Artem Uss, both associated with the Hamburg-based industrial equipment and commodity trading business Nord-Deutsche Industrieanlagenbau GmbH, have been apprehended, federal prosecutors said Wednesday.
Mr. Orekhov was arrested in Germany and Mr. Uss in Italy at the request of the U.S. and will undergo extradition proceedings.
Three other Russian nationals and two Venezuelans were also charged in what prosecutors described as a global scheme to evade U.S. sanctions and export controls. Those defendants haven’t been apprehended.
Attorneys for the seven defendants couldn’t be reached for comment. A representative for the company, which also goes by NDA, didn’t respond to a request for comment.
The defendants were allegedly involved in “orchestrating a complex scheme to unlawfully obtain U.S. military technology and Venezuelan sanctioned oil through a myriad of transactions,” said U.S. Attorney for the Eastern District of New York Breon Peace.
The investigation also involved Task Force KleptoCapture, an interagency law enforcement task force created this year to enforce the sweeping sanctions and export restrictions that the U.S. imposed on Russia in response to its invasion of Ukraine.
Mr. Orekhov has served as the chief executive and part owner for NDA. The other owner was Mr. Uss, the son of a Russian governor, according to prosecutors. The U.S. Treasury Department on Wednesday unveiled sanctions against Mr. Orekhov, NDA and Opus Energy Trading LLC, another Orekhov-linked company. Dubai-based Opus Energy Trading didn’t immediately respond to a request for comment.
The scheme involved the use of NDA as a front to smuggle millions of barrels of oil from Venezuela’s state-owned Petróleos de Venezuela SA, also known as PdVSA, to Russian and Chinese purchasers, prosecutors said. A representative for PdVSA, which is under U.S. sanctions, couldn’t be reached for comment.
The alleged oil buyers included a Russian aluminum company controlled by a sanctioned oligarch and a Chinese energy conglomerate, neither of which were named by prosecutors.
Mr. Orkehov and another alleged co-conspirator were also involved using NDA as a front company to purchase sensitive technology with military applications from U.S. manufacturers, prosecutors said.
The items, which included advanced semiconductors and microprocessors, were shipped to Russian end users, including sanctioned companies, prosecutors said. Some of the same electronic components obtained through the scheme were found in Russian weapons platforms seized in Ukraine, prosecutors said.
NDA was often paid in U.S. dollars that were routed through U.S. institutions and correspondent accounts, prosecutors said. The alleged conspirators used fictitious companies and falsified know-your-customer documentation to facilitate the transactions, prosecutors said.
The 12-count indictment includes charges of bank fraud conspiracy, wire fraud, money laundering conspiracy, smuggling and other crimes.