Alleged Export Violations Yield Criminal Charges

Sept. 5, 2023
By: Ashley J. Bodden

Last month, the U.S. Department of Justice (DOJ) filed charges against Artur Petrov, a Russian-German national. Petrov was charged with export control violations, smuggling, wire fraud, and money laundering offenses based on a scheme to procure U.S.-sourced microelectronics subject to U.S. export controls on behalf of a Russia-based supplier of critical electronics components for manufacturers supplying weaponry and other equipment to the Russian military. The charges also included a temporary denial order by the U.S. Department of Commerce (Commerce) against Petrov and two other co-conspirators and four companies, in which Petrov allegedly worked to procure over $200,000 worth of controlled items.

FBI Assistant Director in Charge James Smith alleges that “Petrov participated in a global scheme that used shell companies around the world to establish a clandestine procurement network and supply Russia’s military industrial complex with critical U.S. technology, including types of microelectronics recovered in Russian military equipment on the battlefield in Ukraine. Petrov and his co-conspirators knowingly misrepresented their business activities to evade export controls in order to procure and transship components associated with Russian guided missiles, drones, and electronic warfare devices.” This lead to an investigation and ultimately Petrov’s arrest August 26, 2023, in Cyprus.

Assistant Secretary for Export Enforcement Matthew S. Axelrod said: “Those who evade our export control restrictions to support Putin’s brutal war machine will be held accountable. Petrov is currently facing a maximum five-year prison sentence for one count of conspiracy to defraud the U.S.; a 20-year sentence for one count of conspiracy to violate the Export Control Reform Act; a 20-year sentence for each of the three counts of violating ECRA; a five-year sentence for one count of conspiracy to smuggle goods from the U.S.; a 10-year sentence for each of the three counts of smuggling goods from the U.S.; a 20-year sentence for one count of conspiracy to commit wire fraud; and another 20-year sentence for one count of conspiracy to commit money laundering.

The Commerce’s temporary denial order includes a Cyprus company Astrafteros Technokosmos LTD, two Russian nationals Zhanna Soldatenkova and Ruslan Almetov: a Latvian distributor Ultra Trade Service LLC; a Tajikistan shell company Juzhoi Electronic, and a Russian company LLC Electrocom VPX. In short, participating in a scheme to transship goods on the export control list will lead to an investigation and possibly a criminal indictment.

If you have questions about export control do not hesitate to contact an attorney at Barnes Richardson & Colburn LLP.