Five employees of a Russian freight forwarder were indicted by the U.S. government on Tuesday for their role in violating U.S. economic sanctions by shipping jet fuel to Syria.
Five employees of a Russian freight forwarder were indicted by the U.S. government on Tuesday for their role in violating U.S. economic sanctions by shipping jet fuel to Syria.
The shipments allegedly were made to sanctioned Syrian entities without any attempt by the forwarder to obtain the proper State and Treasury department licenses.
The indictments were served against Ivan Okorokov, Ilya Loginov, Karen Stepanyan, Alexey Konkov and Liudmila Shmelkova of Joint Stock Company Sovfracht. Additional indictments in this case were served against Syrian national Yaser Naser, who worked on behalf of Sovfracht in Syria to coordinate its business there, and Farid Bitar and Gabriel Bitar, who are petroleum inspectors at Syria’s Port Banias.
All eight individuals were charged with one count of conspiracy to violate the International Emergency Economic Powers Act (IEEPA) and one count of conspiracy to launder monetary instruments.
The maximum statutory penalty for conspiracy to violate IEEPA is five years in jail, while a maximum prison sentence of 20 years can be assessed for conspiracy to commit money laundering.
According to the indictment, as early as 2011 banks began rejecting U.S. dollar wires by Sovfracht that were destined for Syria. The company employees then began using front companies and falsifying information in shipping records and the related U.S. dollar wires to circumvent U.S. sanctions, the indictment said.
The Justice Department noted that Sovfracht also sent emails to its Syrian clients warning them about the “Western sanctions” involving these transactions.
Sovfracht used vessels owned by Transpetrochart Co. Ltd., a Russian company that owned the petroleum tankers Mukhalatka and Yaz, to illegally transship jet fuel and other items to Syria.
On May 8, 2014, Treasury Department’s Office of Foreign Assets Control (OFAC) placed Banias Refinery Co. in Syria on the denied parties list.
However, on Jan. 13, 2016, OFAC blocked two wires from Sovfracht that passed through the United States, totaling $2,585,340, for the delivery of jet fuel to Syria. “As a result, the defendants allegedly began to use third- party companies to continue making U.S. dollar payments for shipments to Syria,” the Justice Department said.
On Sept. 1, 2016, OFAC designated Sovfracht for Crimean sanctions violations. Sovfracht was consequently prohibited from transacting in U.S. dollars without first receiving a license from OFAC for its attempts to transact business with interests in Crimea.
On Sept. 9, 2016, the U.S. government sent notice to Sovfracht of a forfeiture action against a blocked $2,585,340 transaction, and on Dec. 20, 2016, OFAC designated Transpetrochart for working with Sovfracht.
Meanwhile, Sovfracht continued to evade U.S. sanctions and conduct business in U.S. dollars by forming a front company, Maritime Assistance LLC, in October 2016. Additional attempts by Sovfracht via Maritime Assistance at U.S. dollar wire transfers were blocked by OFAC, according to the indictment.
Indictments delivered for jet fuel export scheme
