Brooklyn Man Guilty in Dual Use Exports

Nikolay Grigorev, 36, of Brooklyn, pleaded guilty last week to conspiring to defraud the United States for his role in an illicit export control scheme to ship electronic components from the United States to companies affiliated with the Russian military. Co-defendants Nikita Arkhipov and Artem Oloviannikov remain at large.

Grigorev utilized a Brooklyn-based corporate entity, Quality Life Cue LLC (QLC), to facilitate the scheme. QLC was registered and controlled by Grigorev and Oloviannikov, with Arkhipov utilizing a QLC email account from Russia.

Through QLC, the defendants procured dual-use electronic components for entities in Russia involved in the development and manufacture of drones for the Russian war effort in Ukraine. The most notable of these entities was SMT-iLogic, a Russia-based technology company that was sanctioned in May 2023 for its involvement in the supply chain for producing Russian military UAVs used in Russia’s war against Ukraine.

Between Oct. 22, 2021, and Feb. 22, 2022, QLC accounts controlled by Grigorev received wire transactions from SMT-iLogic totaling approximately $272,830. These funds were used almost entirely to make payments to a Brooklyn-based electronics distributor (the “Brooklyn Company”) or to pay Grigorev’s credit cards, which he used to buy goods from the Brooklyn Company. In email and chat communications, the defendants explicitly discussed their efforts to circumvent U.S. export restrictions, including through the use of front companies in third countries, such as Kazakhstan, and they also forwarded invoices listing SMT-iLogic as the recipient of semiconductors and other electronic components purchased from the Brooklyn Company. In addition, in December 2022, in response to negative press coverage of SMT-iLogic, Grigorev forwarded a news article to his co-defendants and stated, “they are already writing about your (sic) guys in articles about how Russia is getting American components for drones.” In June 2023, a court-authorized search warrant of Grigorev’s residence in Brooklyn resulted in the successful seizure of over 11,500 electronic components that had been purchased from the Brooklyn Company and were awaiting unlawful export to Russia.

As a result of today’s guilty plea, Grigorev faces a maximum penalty of five years in prison. A sentencing hearing has not yet been scheduled. : [11750]. [11345]