U.S. and Russian National Pleads Guilty to Helping Russia's Defense Sector Evade U.S. Export Controls

Press Release

The Defendant Facilitated Russia's Acquisition of Millions of Dollars of U.S.-Made Dual-Use Electronics Used in Radar, Surveillance and Military Research and Development

Earlier today in federal court in Brooklyn, Vadim Yermolenko, a national of both the U.S. and Russia, pleaded guilty to conspiracy to violate the Export Control Reform Act, conspiracy to commit bank fraud, and conspiracy to defraud the United States for his role in a transnational procurement and money laundering network that sought to acquire sensitive dual-use electronics for Russian military and intelligence services. The proceeding was held before United States District Judge Hector Gonzalez. When sentenced, Yermolenko faces up to 30 years in prison.

Merrick B. Garland, United States Attorney General, Breon Peace, United States Attorney for the Eastern District of New York, James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), Jonathan Carson, Special Agent in Charge, New York Field Office of the Office of Export Enforcement, Bureau of Industry and Security (BIS), US Department of Commerce (DOC), and Thomas M. Fattorusso, Special Agent in Charge, Internal Revenue Service-Criminal Investigation, New York (IRS-CI) announced the plea.

"This defendant joins the nearly two dozen other criminals that our Task Force KleptoCapture has brought to justice in American courtrooms over the past two and a half years for enabling Russia's military aggression," said Attorney General Merrick B. Garland. "This defendant admitted to playing a central role in a now-disrupted scheme with Russian intelligence services to smuggle sniper rifle ammunition and U.S. military grade equipment into Russia. The Justice Department will never stop working to aggressively disrupt and prosecute both the criminal networks and the individuals responsible for bolstering the Russian war machine."

"To facilitate the Russian war machine, the defendant played a critical role in exporting sensitive, dual-use technologies to Russia, facilitating shipping and the movement of millions of dollars through U.S. financial institutions," stated United States Attorney Peace. "This plea highlights my Office and our law enforcement partners continued commitment to use all tools available to prosecute those who unlawfully procure U.S. technology to send to Russia."

Mr. Peace thanked the U.S. Customs and Border Protection, the Department of Justice's Office of International Affairs, and the Estonian authorities for their valuable assistance.

"As he admitted today, Vadim Yermolenko took part in a conspiracy to evade U.S. sanctions and assist the Russian war machine by unlawfully purchasing and exporting highly sensitive, export controlled electronic components. The FBI is determined to fulfill our mission of protecting the security of our nation. Any individual attempting to evade our national security laws will be held accountable in the criminal justice system," stated FBI Assistant Director in Charge Dennehy.

"Yermolenko and his illicit network supported Russian intelligence services in attempting to procure sensitive American technology," said Jonathan Carson, Special Agent in Charge, New York Field Office of the Office of Export Enforcement, Bureau of Industry and Security, US Department of Commerce. "You can add this guilty plea to the list of the many enforcement actions we've brought since the start of the Strike Force to target and dismantle Russian procurement networks."

"Whether it was from misplaced foreign allegiance or pure greed, Yermolenko aided Russia's military and intelligence agencies in circumventing policies meant to keep the Russian 'war machine' in check. Through a sophisticated network of shell companies and bank accounts, he laundered more than twelve million dollars and purchased highly sensitive military equipment for Russia. Law enforcement worked in close collaboration to share information and resources, ensuring that Yermolenko and his associates are no longer in operation, making the world safer," said Thomas M. Fattorusso, Special Agent in Charge of IRS-CI New York.

As alleged in court documents, the defendant was affiliated with Serniya Engineering (Serniya) and Sertal LLC (Sertal), Moscow-based companies that operate under the direction of Russian intelligence services to procure advanced electronics and sophisticated testing equipment for Russia's military industrial complex and research and development sector. Serniya and Sertal operated a vast network of shell companies and bank accounts throughout the world, including in the United States, that were used in furtherance of the scheme to conceal the involvement of the Russian government and the true Russian end users of U.S.-origin equipment.

The defendant and his co-conspirators unlawfully purchased and exported highly sensitive, export controlled electronic components, some of which can be used in the development of nuclear and hypersonic weapons, quantum computing, and other military applications. Following Russia's invasion of Ukraine in February 2022, the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) and the DOC BIS levied and imposed additional export restrictions on Serniya, Sertal, and several individuals and companies involved in the scheme, calling them "instrumental to the Russian Federation's war machine."

Sertal was licensed to conduct highly sensitive and classified procurement activities by Russia's Federal Security Service (FSB), Russia's principal security agency and the main successor agency to the Soviet Union's KGB. The Serniya network's Russian clients included State Corporation Rostec, the state-owned defense conglomerate; State Atomic Energy Corporation Rosatom; the Ministry of Defense; the Foreign Intelligence Service; and various components of the FSB, including the Department of Military Counterintelligence and the Directorate for Scientific and Technological Intelligence, commonly known as "Directorate T."

To carry out the scheme, the defendant helped set up numerous shell companies and dozens of bank accounts in the U.S. to illicitly move money and export-controlled goods. During the period charged in the indictment, more than $12 million passed through accounts owned or controlled by the defendant. These funds were used in part to purchase sensitive equipment used in radar, surveillance, and military research and development. In one instance, money from one of the defendant's accounts was used to purchase export-controlled sniper bullets, which were intercepted in Estonia before they could be smuggled into Russia.

Co-defendant Alexey Brayman previously pled guilty to conspiracy to defraud the United States and is awaiting sentence. On July 29, 2024, Konoshchenok was removed from the United States as part of a prisoner exchange negotiated between the United States and Russia. Defendants Boris Livshits, Alexey Ippolitov, Svetlana Skvortsova, and Yevgeniy Grinin remain at large.

This prosecution is coordinated through the Justice Department's Task Force KleptoCapture and the Justice and Commerce Departments' Disruptive Technology Strike Force. Task Force KleptoCapture is an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export restrictions, and economic countermeasures that the U.S. has imposed, along with its allies and partners, in response to Russia's unprovoked military invasion of Ukraine. The Disruptive Technology Strike Force is an interagency law enforcement strike force co-led by the Departments of Justice and Commerce designed to target illicit actors, protect supply chains, and prevent critical technology from being acquired by authoritarian regimes and hostile nation states.

The government's case is being handled by the Office's National Security and Cybercrime Section. Assistant United States <_w3a_listitem listvalue="Choose an item."><_w3a_listitem listvalue="Attorney" datavalue="Attorney"><_w3a_listitem listvalue="Attorneys" datavalue="Attorneys"> Attorneys Artie McConnell, Andrew D. Reich, Matthew Skurnik, and Trial Attorney Scott A. Claffee of the National Security Division's Counterintelligence and Export Control Section, are in charge of the prosecution, along with assistance from Litigation Analysts Emma Tavangari and Mary Clare McMahon.

The <_w3a_listitem listvalue="Choose an item."><_w3a_listitem listvalue="Defendant" datavalue="Defendant"><_w3a_listitem listvalue="Defendants" datavalue="Defendants">Defendant:

VADIM YERMOLENKO
AGE: 43
Upper Saddle River, New Jersey

Other Defendants:

ALEXEY IPPOLITOV
AGE: 58
Moscow, Russia

YEVGENIY GRININ
age: 46
Moscow, Russia

BORIS LIVSHITS
Age: 54
St. Petersburg, Russia

SVETLANA SKVORTSOVA
AGE: 43
Moscow, Russia

VADIM KONOSHCHENOK
AGE: 50
Tallin, Estonia

ALEXEY BRAYMAN
AGE: 37
Merrimack, New Hampshire

E.D.N.Y. Docket No. 22-CR-409 (S-3) (HG)

NIKOLAOS BOGONIKOLOS

AGE: 60

Athens, Greece

E.D.N.Y. Docket No. 23-MJ-412

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Updated November 1, 2024