US authorities indicted a number of Russian and Syrian nationals on Tuesday for alleged money laundering and circumvention of US economic sanctions against Syria and Crimea through the use of front companies and falsified documents, the Justice Department announced.Eight businessmen, including five Russians and three Syrians, are accused of conducting their illicit business through the Russian shipping company and freight forwarder Sovfracht.
In 2004 the US imposed economic sanctions on Syria that prohibit, among other things, the direct or indirect supply of US goods, technologies, or services to the country, including the use of US dollar wires for overseas transactions.
According to the indictment, banks began rejecting US dollar wires by Sovfracht destined for Syria in 2011. Subsequently, the alleged conspirators began using front companies and falsified shipping and financial records to evade the restrictions.The defendants purportedly used vessels from a Russian based company, Transpetrochart, to transship jet fuel and other items surreptitiously to Syria.In early 2016, the Treasury Department Office of Foreign Assets Control (OFAC) blocked two wires totaling US$2,585,340 from Sovfracht that passed through the United States for the delivery of jet fuel to Syria.
As a result, the defendants allegedly began using third party companies to continue making US dollar payments for shipments to Syria, according to the indictment.In September 2016, however, OFAC designated Sovfracht for violating sanctions against Crimea and prohibited the company from transacting in US dollars - regardless of whether or not the sale was supplying goods to Syria - without first receiving a license from OFAC.Maritime allegedly continued to operate with US dollars for the delivery of jet fuel to Syria, violating both the Crimean and Syrian sanctions.
Following these new restrictions, the defendants started using Maritime Assistance LLC as a front company for Sovfracht to continue conducting US dollar transactions. Maritime and Sovfracht employees acted interchangeably, according to the indictment, and Maritime assumed debts and contracts previously owned by Sovfracht.
“The U.S. sanctions on Syria and Crimea thwart Syria’s support of terrorism and its pursuit and use of weapons of mass destruction, as well as the actions of those who seek to undermine Ukraine’s democratic processes and territorial integrity,” said Assistant Attorney General for National Security John Demers. “The defendants allegedly conspired to defy our sanctions against Syria and Crimea, endangering both American interests in the region as well as our foreign policy and national security at home.”The case is currently being investigated by the FBI’s Washington Field Office. If convicted of all charges, the defendants face up to 25 years in prison.