Enforcement

A Kyrgyz national and international arms dealer has been charged in a federal indictment with conspiracy and illegal smuggling of firearms from the United States to Russia. Sergei Zharnovnikov was arrested on January 24 in Las Vegas, while attending the Shooting, Hunting, and Outdoor Trade (SHOT) Show. Zharnovnikov is accused of orchestrating a complex scheme to circumvent U.S. export controls by funneling semi-automatic rifle-pistols through his Kyrgyz company to Russia. The indictment details his illegal procurement of firearms from a U.S.-based company in Chesapeake, Virginia, and subsequent exportation, in violation of U.S. export laws.

The Justice Department announced Thursday that Dominican Republic authorities seized a Dassault Falcon 2000EX aircraft used by Petroleos de Venezuela, S.A. (PdVSA), the sanctioned Venezuelan state-owned oil and natural-gas company, at the request of the U.S. government based on violations of U.S. export control and sanctions laws. The Justice Department previously announced in September 2024 the seizure of a Dassault Falcon 900EX aircraft in the Dominican Republic that was owned and operated for the benefit of Nicolás Maduro Moros and persons affiliated with him in Venezuela.

A federal grand jury returned a superseding indictment February 4,  charging a Chinese national with seven counts of economic espionage and seven counts of theft of trade secrets in connection with an alleged plan to steal from Google LLC  proprietary information related to AI technology. Linwei Ding, also known as Leon Ding, 38 was initially indicted in March 2024 on four counts of theft of trade secrets. The superseding indictment describes seven categories of trade secrets stolen by Ding and charges Ding with seven counts of economic espionage and seven counts of theft of trade secrets.

The Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) assessed a $37,000,000 civil money penalty against Brink’s Global Services USA, Inc. for willful violations of the Bank Secrecy Act (BSA). As a result of Brink’s failures, hundreds of millions of dollars in bulk currency shipments were transmitted across the Southwest Border on behalf of high-risk entities—including a Mexican currency exchanger that later pleaded guilty to violating the BSA. This is FinCEN’s first enforcement action against an armored car company.

Her first full day as Attorney General, Pam Bondi issued a raft of policy changes, including a memorandum outlining the new administration's policies on charging, plea negotiations and sentencing.     Tacked onto the end of the five-page memo, Ms. Bondi continued the purge of the National Security Division, disbanding the Foreign Influence Task Force and the National Security Division's Corporate Enforcement Unit, and instructing the Counterintelligence and Export Control Section to "focus on civil enforcement, regulatory initiatives, and public guidance." Another memo directs FCPA directs prosecutors to prioritize the investigation drug cartels and transnational criminal organizations (TCOs) and to “shift focus away from cases that do not involve such a connection.”

The Justice Department Thursday  announced its participation in a multinational operation involving actions in the United States, Romania, Australia, France, Germany, Spain, Italy, and Greece to disrupt and take down the infrastructure of the online cybercrime marketplaces known as Cracked and Nulled. The operation was announced in conjunction with Operation Talent, a multinational law enforcement operation supported by Europol to investigate Cracked and Nulled.

The Justice Department announced the indictment of five men for their involvement in a "laptop farming" scheme which involved obtaining remote IT work with US companies to generate revenue for the North Korean Government (DPRK). According to the indictment, the defendants used forged and stolen identity documents, including U.S. passports containing the stolen personally identifiable information of a U.S. person, to conceal the true identities of North Korean co-conspirators, so that these North Korean nationals could circumvent sanctions and other laws to obtain employment with U.S. companies.

The Department of Commerce’s Bureau of Industry and Security and the Treasury’s Office of Foreign Assets Control imposed approximately $2.5 million in combined civil penalties against a California machine tool builder for permitting authorized distributors to sell equipment and repair parts to sanctioned entities in China and Russia, “Today’s coordinated resolution with OFAC demonstrates our resolve to hold accountable companies that do not put in place effective compliance programs to prevent exports to Entity Listed companies,” said Acting Assistant Secretary for Export Enforcement Kevin J. Kurland. 

Miami real estate broker Roman Sinyavsky pleaded guilty today to engaging in a scheme to violate U.S. sanctions and commit money laundering by conducting transactions involving blocked properties owned by sanctioned Russian oligarchs Viktor Perevalov and Valeri Abramov.   The properties, valued approximately $1.8 million were forfeited earlier this month. In a separate settlement, Sinyavsky and his company have agreed to pay a civil penalty of approximately $1,076,923.

A Chinese telecommunications company has admitted in federal court in Chicago that it conspired to steal digital mobile radio technology developed by Illinois-based Motorola Solutions, Inc. Hytera Communications Corp. Ltd. pleaded guilty on Monday in the Northern District of Illinois to a federal charge of conspiracy to steal trade secrets.  Under the terms of a plea agreement, Hytera may be fined up to $60 million.  …

A Montreal man was sentenced Wednesday to  to 40 months in prison for conspiring to commit export control violations. Nikolay Goltsev masterminded a global procurement scheme on behalf of sanctioned Russian companies, including Russian military companies. Some of the electronic components shipped by Goltsev were later found in seized Russian weapons platforms and signals intelligence equipment in Ukraine.

A member of the Yakuza crime syndicate has pleaded guilty to trafficking nuclear materials, including weapons-grade plutonium, from Burma. The scheme was uncovered during a DEA investigation into narcotics and firearms trafficking. Takeshi Ebisawa, 60, of Japan, pleaded guilty in Manhattan to conspiring with a network of associates to traffic nuclear materials, including uranium and weapons-grade plutonium, from Burma to other countries, as well as to international narcotics trafficking and weapons charges.   Ebisawa pleaded guilty to six counts contained in the superseding indictment issued in February 2024

The Department of Justice announced that, pursuant to a court-ordered default judgment and final order of forfeiture entered on Jan. 7, it has secured the forfeiture of two two Miami condominiums that were maintained, transferred, and leased in violation of U.S. sanctions against Russian national Viktor Perevalov. The forfeited properties have a combined value of approximately $1.8 million. Perevalov, a constructions executive, was sanctioned in January 2018 for his work in Russia-occupied Crimea. Later that year, a Miami real estate agent retained to manage the properties transferred the two condominiums owned by Perevalov to a limited liability company set up to obfuscate Perevalov’s interest in the properties. Following the transfer, the properties continued to be leased, generating proceeds used to maintain them.

The Justice Department announced Tuesday that it entered into an agreement to share $50 million in forfeited assets with the Republic of Estonia in recognition of Estonia’s assistance in the successful prosecution of Danske Bank and related forfeiture. In December 2022, Danske Bank pleaded guilty to one count of conspiracy to commit bank fraud in a scheme to defraud U.S. banks regarding Danske Bank Estonia’s customers and anti-money laundering controls to facilitate access to the U.S. financial system. According to admissions and court documents, Under the agreement, Estonia will use the funds to strengthen its capacity to fight financial crime.

The Team at BIS Export Enforcement condensed an exceedingly active year to a page and a half memo of admirable brevity recapping the office's activities. The men and women of Export Enforcement work tirelessly to help safeguard our collective national security. From degrading the Russian war machine to stopping the People’s Republic of China (PRC) from acquiring advanced U.S. technology, our efforts impose costs on adversaries and degrade their battlefield capabilities.

OFAC announced a $22,172 settlement with a a New York aviation supplies distributior to settle its potential civil liability for six apparent violations of OFAC sanctions related to Russia’s aerospace and technology sectors. In 2024, SkyGeek Logistics, Inc. attempted two refunds and sent four shipments to two Specially Designated Nationals in the United Arab Emirates sanctioned in connection with these sectors. The settlement amount reflects OFAC's determination that the apparent violations were non-egregious and that certain of its conduct was voluntarily self-disclosed.

Bureau of Industry and Security (BIS) published its third quarterly update of the boycott Requester List. The list notifies companies, financial institutions, freight forwarders, individuals, and other U.S. persons of potential sources of certain boycott-related requests they may receive during the regular course of business. Firms removed from the list include Siemens Energy Global GMBH & CO KG of Germany, Saudi operations of Waste Management, and Malaysian operations of nine firms, including Flextronics and Halliburton. Additions to the list include seven Malaysian entities, six from Bangladesh, four from Saudi and the UAE, three from Turkey and Pakistan, and others, including the UK, Libya, Japan and Australia.

A New York solder manufacturer settled violations associated with the sales of products to Russia valued at approximately $96,506. Indium Corporation of America cooperated with the investigation conducted by BIS’s Office of Export Enforcement (OEE) and took remedial measures after discovering the conduct at issue, which resulted in a significant reduction in the penalty.  The items exported by Indium are classified EAR99, however, because these items were classified by Harmonized Tariff Schedule (HTS) codes that appeared on Supplement no. 5 to Part 746 of the EAR at the time of export, these items required a license for export to Russia

A California firm has agreed to pay over $3 million as part of a settlement agreement for unlicensed shipments of transistors to Russia. Because the firm did not regularly review revisions to the EAR they failed to recognize that, as of February 2023, such items required a license for export to Russia.

An Illinois aviation services company will pay over $55 million to resolve investigations by the Justice Department and Securities and Exchange Commission (SEC) into violations of the Foreign Corrupt Practices Act (FCPA).  AAR Corp was facing prosecution for paying bribes to government officials in Nepal and South Africa.

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