Special Report How Military Technology Arrives In Russia In Violation Of Us Export Controls

(Reuters) – On his own account, Ilias Sabirov, a businessman from Moscow, had supplied the Russian army with high-performance computer chips made in the United States for years. Then in 2014, Russia occupied the Ukrainian peninsula of Crimea and the US government began imposing a series of new sanctions and export controls on Russia, including a severe restriction on the sale of such chips. But that did not stop Sabirov from gaining more, according to US authorities and a Reuters review of Russian customs records. In the spring of 2015, a package containing more than 100 memory chips specially hardened to withstand radiation and extreme temperatures – critical components in rockets and military satellites – arrived at Sabirov’s professional address in Moscow, according to Russian customs and a US federal indictment. . U.S. prosecutors say the “rad-hard” chips came from a company in Austin, Texas, called Silicon Space Technology Corp., or SST, but were shipped to Russia through a company in Bulgaria to circumvent U.S. export law. After Russia launched a full-scale invasion of Ukraine in February, the United States and more than 30 other nations responded with an unprecedented barrage of additional sanctions and export restrictions. But the story of how American chips arrived from Texas to Moscow in 2015 shows how sensitive Western technology can still end up in Russia despite tight US export controls. This narrative of the criminal case against Sabirov and two Bulgarian businessmen, which remains open, contains new details from interviews with US officials and several key figures, including two fugitives. And it points to the challenges of enforcing a strict export control regime, especially on so-called dual-use components that can serve both civilian and military purposes. The Texas Plan and other US technology-sensitive cases in Russia, investigated by Reuters, reveal a chain of willing suppliers, front and shell companies and false claims in export papers that specialized Western components were not intended for politics and for military use. The sought-after components include microelectronics and precision instruments for the Russian military. The story goes on During the war, said US Department of Defense spokeswoman Sue Goff, hard chips played an essential role in communications, information and surveillance. “Acquiring technology to harden radioactivity from aggressive nuclear-capable states, such as Russia, could inspire them, increasing the destabilization of international security,” Goof said. “Therefore, the protection of these chips is extremely important to US national security.” Today, Russia’s efforts to circumvent US restrictions on military and other sensitive technology are on the rise, according to U.S. Homeland Security officials. A task force of 25 U.S. anti-proliferation analysts tasked with detecting suspicious missions shifted its focus from China to Russia in late February, HSI officials said. “China is not dominating our attention as it used to and Russia is the one where we have seen the biggest increase in recent times,” said Greg Slavens, who recently retired after 30 years as the HSI’s watchdog. “The Russians have steadily increased their efforts to acquire chips for rocket and space technology.” The Kremlin has not responded to questions about US allegations that it is using deceptive plans to circumvent Western sanctions and trade restrictions. Russia has previously described Western sanctions as hostile. US Commerce Secretary Gina Raimondo, who met with Ukrainian Prime Minister Dennis Smihal in Washington on April 21, said in a statement on the same day that her department “focuses with a laser to deprive Russia of the items and technologies it needs.” to maintain her war machine. “ Complicates U.S. law enforcement: As of 2018, Russia no longer authorizes U.S. export control officers to conduct on-the-spot checks to ensure that sensitive products are used for their officially declared purposes, according to know the subject. Even when suspects are identified, the cases may take years to be investigated and tried, while the accused Russian nationals remain outside the scope of US law. In the case of Texas, it took about five years for the US authorities to prosecute and impose sanctions. Sabirov, as well as two Bulgarian businessmen, Dimitar and Milan Dimitrov, were indicted in 2020 on charges of illegally exporting hard rad chips to Russia and laundering dirty money. And SST, which changed its name to Vorago Technologies in 2015, was fined $ 497,000 last year by the U.S. Department of Commerce’s Office of Industry and Security in a separate executive action. The office oversees export licenses for goods that can be used for both civilian and military purposes. The Texas company, which had repeatedly been warned by its own lawyers that it could not send hard chips to Russia without permission, admitted that from 2014 to 2019, it had conspired with the three men to do just that. Reuters could not determine whether the chips were eventually used for military purposes. The U.S. Attorney’s Office in West Texas declined to comment. In a statement, Vorago said it “is, and has always been, committed to zero tolerance compliance with all U.S. laws, including export controls.” He said he was “fully cooperative” in US research and “has implemented enhanced compliance and training procedures to prevent a recurrence.” The company also said it was “deliberately misled into believing that shipments were going to Bulgaria for use in Europe – a legal export. These customers provided a seemingly valid end-user certificate to Vorago certifying that the end user of Vorago products was in Russia .” Sabirov denied any wrongdoing in an interview with Reuters, saying the hard chips never went from Bulgaria to Moscow, which contradicts data gathered by US prosecutors and customs records examined by Reuters. He said he always complied with US export rules and never laundered money. “The sanctions they imposed on me, my companies and my friends are completely unfair, completely false and completely wrong,” he said. Milan Dimitrov also denied any wrongdoing. Allegations of export violations are “stupid,” he told Reuters. “The whole thing is a misunderstanding.” Sabirov, who is in Russia, and the two Bulgarians remain fugitives in the criminal case. COLD WAR SOUND A Reuters review of US courts and other federal archives shows that the Texas case is not unique. Between 2008 and 2014, a group of father and son smuggled sensitive microchips worth more than $ 65 million from New Jersey to companies in the Moscow region directly linked to Russian military, intelligence and nuclear design programs, according to US authorities. . Alexander Brazhnikov Jr. from New Jersey, a Russian-born naturalized U.S. citizen, pleaded guilty in federal court in 2015 to buying, repackaging, and labeling microelectronics in the United States and then shipping the goods to Moscow-based the father, Russian national. There were a total of 1,923 shipments and the son admitted that the money to be paid was laundered by Russia through 50 foreign shell companies, registered in countries stretching from the Marshall Islands to the Pacific to Panama and Belize in Central America, court records show. . “We believe that all the microchips went to the military-industrial complex because Russia does not produce anything else that would require this level of chip,” said Peter Gaeta, one of the prosecutors in the case, which remains open. The son, whose field of study was listed as “nuclear physics” in court records, was sentenced to 70 months in prison and released in December 2018. His father, Alexander Brazhnikov Sr., owner of import-export microelectronics based in Moscow , was accused of conspiracy and remains a fugitive. The company reportedly distributed the parts it acquired in the United States to Russian defense contractors licensed to supply spare parts for the Russian military and security services, and to Russian companies involved in the design of nuclear weapons. “The scale of this case is simply appalling,” Gaeta told Reuters. “But this was not a lone wolf operation. This is generally the case with Russia.” Alexander Brazhnikov Jr. declined to comment. It was not possible to communicate with his father. In another case, Alexander Fishenko, a dual U.S. and Russian national, conducted a multi-year program to supply and ship sensitive microelectronics from U.S.-based companies to Russian government customers, including military and intelligence services. Fishenko owned an export company based in Houston, Texas and was also an executive at a Moscow-based procurement company, according to federal prosecutors. Between 2002 and 2012, his export company sent goods through New York to contacts in countries such as Finland, Canada and Germany who would send them to Russia. Among the items were electronics with applications in radar and surveillance systems, weapons guidance systems and explosion scandals. Fishenko and 10 others were indicted in 2012 for plotting to sell controlled technology to Russia without the necessary permits. He later pleaded guilty, among other things, to acting as an agent of the Russian government. Seven others were convicted either on appeal or in court. Fisenko spent more than seven years behind bars. New York lawyer Richard Levitt, who represented Fisenko in the case, declined to comment and Fisenko himself could not be reached for comment. “It is common for illegal exports of controlled technology to pass through intermediaries abroad to hide the …