Associate Of Sanctioned Oligarch Indicted For Sanctions Evasion And Money Laundering

Damian Williams, the United States Attorney for the Southern District of New York, Andrew C. Adams, the Director of Task Force KleptoCapture, Ivan J. Arvelo, the Special Agent in Charge of the New York Field Office of Homeland Security Investigations (“HSI”), and Maged Behnam, Acting Special Agent in Charge of the Miami Field Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of an Indictment charging VLADIMIR VORONCHENKO, a/k/a “Vladimir Vorontchenko,” a citizen of the Russian Federation and legal permanent resident of the United States, with participating in a scheme to make over $4 million in U.S. dollar payments to maintain four real properties in the United States that were owned by Viktor Vekselberg, a sanctioned oligarch, as well as to attempt to sell two of those properties.  The Indictment also charged VORONCHENKO with contempt of court in connection with his flight from the United States following receipt of a Grand Jury subpoena requiring his personal appearance and testimony.

U.S. Attorney Damian Williams said: “The indictment unsealed today signals the United States’ continued commitment to holding individuals who violate sanctions to account.  Vladimir Voronchenko and others illegally funneled millions of dollars into the United States to maintain luxury U.S. residences owned by Russian oligarch Viktor Vekselberg.  With these charges, the United States sends a strong message that it will continue to vigorously enforce economic sanctions, including those imposed in response to Russia’s illegal and unjustified aggression in Ukraine.”

Director of Task Force KleptoCapture Andrew C. Adams said: “Shell companies, strawmen, and professional money launderers did not shield Voronchenko or the illicit transactions charged today from the investigative persistence of HSI, FBI, and the attorneys of the Southern District of New York.  Today’s indictment is yet another reminder of the priority that the Department of Justice places on uncovering the proceeds of kleptocracy and sanctions evasion and on prosecuting those who would take a paycheck in exchange for facilitating money laundering and sanctions evasion.”

HSI Special Agent in Charge Ivan J. Arvelo said: “Russian illicit finance is a threat to U.S. national and homeland security, one that expands fissures of vulnerability in our financial system.  With the advent of the Ukrainian invasion, such global threats were made increasingly more domestic, as Putin’s enablers were revealed to have sequestered billions in illicit wealth in U.S. based real property and luxury assets.  HSI will not allow the American financial system to unknowingly facilitate dark money transfers, and today we have charged another oligarch facilitator for his alleged actions in support of the corrupt regime.” 

According to the allegations in the Indictment unsealed in Manhattan federal court today:[1]

VORONCHENKO, who resided at various times in New York, New York, Southampton, New York, Fisher Island, Florida, and Russia, held himself out as a successful businessman, art collector, and art dealer, and as a close friend and business associate of Viktor Vekselberg. 

On April 6, 2018, the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) designated Vekselberg as a Specially Designated National (“SDN”) in connection with its finding that the actions of the Government of the Russian Federation in Ukraine constituted an unusual and extraordinary threat to the national security and foreign policy of the United States.  On or about March 11, 2022, OFAC redesignated Vekselberg as an SDN and blocked Vekselberg’s yacht and private airplane.

Prior to his designation by OFAC, between in or about 2008 and in or about 2017, Vekselberg, through a series of shell companies, acquired real properties in the United States, specifically, (i) an apartment on Park Avenue in New York, New York, (ii) an estate in Southampton, New York, (iii) an apartment on Fisher Island, Florida, and (iv) a penthouse apartment also on Fisher Island, Florida (collectively, “the Properties”).  As of the date of this Indictment, the Properties were worth approximately $75 million. 

VORONCHENKO retained an attorney (the “Attorney”), who practiced in New York, New York, in connection with the acquisition of the Properties.  The Attorney also managed the finances of the Properties, including by paying common charges, property taxes, insurance premiums, and other fees associated with the Properties in U.S. dollar transactions from the Attorney’s interest on lawyer’s trust account (“IOLTA account”).

Prior to Vekselberg’s designation as an SDN, between approximately February 2009 and March 2018, shell companies owned by Vekselberg sent approximately 90 wire transfers totaling approximately $18.5 million to the IOLTA account.  At the direction of VORONCHENKO and his family member who lived in Russia, the Attorney used these funds to make various U.S. dollar payments to maintain and service the Properties. 

Immediately after Vekselberg’s designation as an SDN, the source of the funds used to maintain and service the Properties changed.  The IOLTA Account began to receive wires from a bank account in the Bahamas held in the name of a shell company controlled by VOROCHENKO, “Smile Holding Ltd.,” and from a Russian bank account held in the name of a Russian national who was related to VORONCHENKO.  Between approximately June 2018 and March 2022, approximately 25 wire transfers totaling approximately $4 million were sent to the IOLTA account.  Although the source of the payments changed, the management of the payments remained the same as before: VORONCHENKO and his family member directed the Attorney to use these funds to make various U.S. dollar payments to maintain and service the Properties.  Additionally, after Vekselberg was sanctioned in 2018, VORONCHENKO and others tried to sell both the Park Avenue apartment and the Southampton estate.  No licenses from OFAC were applied for or issued for these payments or attempted transfers.  

On or about May 13, 2022, federal agents served VORONCHENKO on Fisher Island with a Grand Jury subpoena, which called for his personal appearance for testimony and his production of documents.  Approximately nine days later, on or about May 22, 2022, VORONCHENKO took a flight from Miami, Florida, to Dubai, United Arab Emirates, and then went to Moscow, Russia.  VORONCHENKO failed to appear before the Grand Jury and has not returned to the United States.

*                *                *

VORONCHENKO, 70, of Moscow, Russia, New York, New York, Southampton, New York, and Fisher Island, Florida, was charged with conspiring to violate and evade U.S. sanctions, in violation of the International Emergency Economic Powers Act (“IEEPA”); violating the IEEPA; conspiring to commit international money laundering; and international money laundering, each of which carries a maximum sentence of 20 years in prison.  VORONCHENKO was also charged with contempt of court, which carries a maximum sentence within the discretion of the Court.  The Indictment also provides notice of the United States’ intention to forfeit from VORONCHENKO the proceeds of his offenses, including the Properties. 

The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.

Mr. Williams praised the outstanding work of HSI and FBI.  Mr. Williams further thanked the Department of Justice’s National Security Division and Office of International Affairs and OFAC for their assistance and cooperation in this investigation.

On March 2, 2022, the Attorney General announced the launch of Task Force KleptoCapture, an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export restrictions, and economic countermeasures that the United States has imposed, along with allies and partners, in response to Russia’s unprovoked military invasion of Ukraine.  The Task Force will leverage all the Department’s tools and authorities against efforts to evade or undermine the economic actions taken by the U.S. government in response to Russian military aggression.

This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit.  Assistant U.S. Attorneys Jessica Greenwood, Joshua A. Naftalis, and Sheb Swett are in charge of the prosecution. 

The allegations in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.