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On Wednesday, a federal court in Brooklyn, New York, issued a 12-count indictment against five Russian and two Venezuelan nationals who participated in a criminal scheme to sell tons of oil and military technologies purchased from American manufacturers, evading sanctions applied to Russian companies and state-owned Petróleos de Venezuela (PDVSA).
Yury Orekhov, Artem Uss, Svetlana Kuzurgasheva, also known as Lana Neumann, Timofey Telegin and Sergey Tulyakov were indicted on several charges related to procurement network, smuggling and money laundering.
Prosecutors accused Venezuelans Juan Fernando Serrano and Juan Carlos Soto of acting as intermediaries to obtain illicit agreements with Pdvsa.
“Today we announce the dismantling of a sophisticated network consisting of at least five Russian nationals and two Venezuelan nationals, each of whom are directly linked to corrupt state-owned enterprises, who knowingly sought to conceal the theft of U.S. military technology and profit off black market oil,” Michael Driscoll, deputy director in charge of the FBI, said in a U.S. Department of Justice press release.
U.S. Attorney Breon Peace stated that “the defendants were criminal enablers for oligarchs, orchestrating a complex scheme to unlawfully obtain U.S. military technology and Venezuelan sanctioned oil through a myriad of transactions involving shell companies and cryptocurrency. Their efforts undermined security, economic stability and rule of law around the world.”
According to the investigation, Russians Yury Orekhov and Artem Uss, owners of the German company Nord-Deutsche Industrieanlagenbau GmbH, shipped millions of barrels of oil from Venezuela to buyers in Russia and China.
How was the oil shipped?
Juan Fernando Serrano heads a commodities trading company called Treseus, which has offices in Spain, Italy and Dubai. Although Venezuela is not mentioned, the company sells asphalt made from Venezuela’s heavy crude oil, according to an investigation by AP journalist Joshua Goodman.
A Russian front company run by Setevye Tekhnologii, one of the co-defendants, bought one million barrels of sanctioned oil in February in exchange for US$32 million. The crude was produced by Petropiar, a joint venture between Pdvsa and Chevron.
Illegal crude oil was allegedly traded by Treseus for Venezuela at a deep discount of 40%, through shell companies in China, a Venezuelan-owned company in Moscow, bulk cash and even cryptocurrencies (Tether).
The oil was loaded onto a Vietnamese vessel, which although not named in the prosecution’s indictment, documents accessed by AP show it to be a ship named Melogy.
The vessel turned off its GPS on December 31, 2021 and remained so for about four months so as not to be detected by radars. It appeared again on a route from Asia.
Googman explained than from June 9-12, the Melogy transferred its illegal cargo to a floating storage vessel, the Harmony Star, off the coast of Malaysia. He also said that the vessel is accused of being part of a wider smuggling network that also involves Iran.
As for the electronic components, these were purchased by the Russians through their German company and were found on battlefields in Ukraine.
Nord-Deutsche Industrieanlagenbau GmbH, also known as NDA, was allegedly used as a front to buy military technology, as well as other components used for warfare, such as semiconductors, radars and even satellites.
All of these items were then allegedly sold to sanctioned Russian companies controlled by Timofey Telegin and Sergey Tulyakov – two other citizens indicted by prosecutors – such as Radioavtomatika, Radioexport and Abtronics, which supply components to the Russian government’s military industry.
The defendants could face up to 30 years in prison. Orekhov was arrested in Germany on Monday, while Uss was detained in Italy, from where the U.S. is seeking extradition.
Slight detour: Treseus also appears to have brokered shipments this year to a Malaysian refinery owned by Thai asphalt giant Tipco, according to this document seen by @AP.
Tipco isn’t referenced in the indictment. For more on Tipco my 2020 investigation: https://t.co/2DwFdO4iWe pic.twitter.com/Iaap0D3iR6
— Joshua Goodman (@APjoshgoodman) October 19, 2022