May 27, 2024

Civil Forfeiture Complaint Filed Against Six Luxury Real Estate Properties Involved In Sanctions Evasion And Money Laundering | USAO-SDNY

Civil Forfeiture Complaint Filed Against Six Luxury Real Estate Properties Involved In Sanctions Evasion And Money Laundering | USAO-SDNY

Damian Williams, the United States Lawyer for the Southern District of New York, Andrew C. Adams, the Director of Job Pressure KleptoCapture, Ivan J. Arvelo, the Distinctive Agent in Demand of the New York Subject Office of Homeland Stability Investigations (“HSI”), and Maged Behnam, Acting Specific Agent in Charge of the Miami Industry Office environment of the Federal Bureau of Investigation (“FBI”), announced these days the submitting of a civil forfeiture complaint towards 6 real qualities situated in New York, New York, Southampton, New York, and Fisher Island, Florida, worthy of close to $75 million.  The Complaint alleges that the attributes, which are beneficially owned by Russian oligarch Viktor Vekselberg, are the proceeds of sanctions violations and were being associated in intercontinental dollars laundering in marketing of sanctions violations committed by, amongst other individuals, Vladimir Voronchenko, a/k/a “Vladimir Vorontchenko,” who was indicted on February 7, 2023. 

U.S. Legal professional Damian Williams reported: “Today’s action, submitted on the anniversary of Russia’s full-scale invasion of Ukraine, seeks forfeiture of six luxurious homes owned by Viktor Vekselberg that his affiliate Vladimir Voronchenko managed by funneling thousands and thousands of pounds into the United States.  With the filing of this criticism, the United States sends a potent concept to those who violate sanctions and interact in dollars laundering that the United States will use every readily available software to forfeit criminal proceeds and will use that money to support our allies in Ukraine beneath the freshly enacted legislation.”

Director of Endeavor Drive KleptoCapture Andrew C. Adams explained: “Strawmen, corrupt pros, and shell businesses could be the hallmarks of revenue laundering and sanctions evasion, but they are road blocks that diligent, dedicated investigators and prosecutors will surmount.  Today’s filing marks however yet another action that the Section of Justice and our partners at HSI and FBI have taken toward dislodging ill-gotten gains from individuals who would attempt to evade U.S. sanctions, and toward building the price of these homes readily available for assist to Ukraine.”

HSI Specific Agent in Charge Ivan J. Arvelo mentioned: “For several years, Russia’s weaponization of corruption has relied on opaque authorized constructions – and Western enablers – to transfer, disguise, and shell out stolen prosperity, enriching its oligarchs and in the long run resourcing the war in the Ukraine.  Considering that the invasion, HSI New York and our companions have worked tirelessly to slash Russia’s corruptocrats and their belongings out of the American fiscal procedure.  Now we keep on our active steps and get rid of jewels from the crown of however one more oligarch, stripping him of the luxury assets he so cherishes.”

FBI Acting Distinctive Agent in Charge Maged Behnam explained: “The mission of the interagency Process Force KleptoCapture is to enforce sanctions, export restrictions, and financial countermeasures imposed by the United States in response to Russia’s unprovoked navy invasion of Ukraine one particular year in the past.  This civil forfeiture grievance is an example of the Job Force’s ongoing function to satisfy this mission.  I commend the hard get the job done, commitment, and cooperation of this crew of pros.”

According to the allegations in the Grievance filed in Manhattan federal court docket nowadays:[1]

On April 6, 2018, the U.S. Office of the Treasury’s Business office of International Belongings Regulate (“OFAC”) specified Vekselberg as a Specially Designated Nationwide (“SDN”) in connection with its finding that the actions of the Authorities of the Russian Federation in Ukraine constituted an abnormal and extraordinary menace to the national protection and international policy of the United States.  On or about March 11, 2022, OFAC redesignated Vekselberg as an SDN and blocked Vekselberg’s yacht and private plane.

Prior to his designation by OFAC, amongst in or about 2008 and in or about 2017, Vekselberg, by a sequence of shell companies, acquired six real homes in the United States, specially, (i) two flats on Park Avenue in New York, New York, (ii) an estate in Southampton, New York, (iii) two flats on Fisher Island, Florida, and (iv) a penthouse condominium also on Fisher Island, Florida (collectively, “the Properties” or the “Defendants-in-rem”).  As of the date of the Complaint, the Homes had been worthy of around $75 million. 

Voronchenko, Vekselberg’s shut mate and business associate, retained an lawyer (the “Attorney”), who practiced in New York, New York, in relationship with the acquisition of the Attributes.  The Lawyer also managed the finances of the Houses, which includes by spending widespread charges, property taxes, insurance coverage rates, and other service fees linked with the Homes 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, involving roughly February 2009 and March 2018, providers owned by Vekselberg sent close to 90 wire transfers totaling somewhere around $18.5 million to the IOLTA account.  At the direction of Voronchenko and his loved ones member who lived in Russia, the Lawyer employed these cash to make a variety of U.S. greenback payments to retain and assistance the Homes. 

Promptly just after Vekselberg’s designation as an SDN, the resource of the funds utilized to keep and support the Properties transformed.  The IOLTA Account started to receive wires from a bank account in the Bahamas held in the name of a shell firm managed by Voronchenko, Smile Keeping Ltd., and from a Russian lender account held in the name of a Russian nationwide who was associated to Voronchenko.  Between around June 2018 and March 2022, approximately 25 wire transfers totaling about $4 million ended up despatched to the IOLTA account.  While the source of the payments improved, the management of the payments remained the identical as prior to: Voronchenko and his loved ones member directed the Attorney to use these funds to make numerous U.S. dollar payments to maintain and support the Homes.  In addition, soon after Vekselberg was sanctioned in 2018, Voronchenko and other people tried using to market both equally the Park Avenue condominium and the Southampton estate.  No licenses from OFAC had been used for or issued for any of these payments or tried transfers.  

On or about May perhaps 13, 2022, federal brokers served Voronchenko on Fisher Island with a Grand Jury subpoena, which named for his individual overall look for testimony and his production of documents, like paperwork relating to the Houses.  Approximately 9 times afterwards, on or about May well 22, 2022, Voronchenko took a flight from Miami, Florida, to Dubai, United Arab Emirates, and then went to Moscow, Russia.  Voronchenko failed to surface right before the Grand Jury and has not returned to the United States.

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The Qualities topic to the forfeiture motion are as follows:

  • 19 Duck Pond Lane, Southampton, New York 11968
  • 515 Park Avenue, Models 21 and 2I, New York, New York 10022
  • 7002 Fisher Island Generate, Unit 7002 PH2, Miami Seaside, Florida 33109 and
  • 7183 Fisher Island Generate, Units 7182 and 7183, Miami Beach front, Florida 33109.

Mr. Williams praised the exceptional get the job done of the New York and Miami industry workplaces of HSI and the FBI.  Mr. Williams further more thanked the Section of Justice’s Nationwide Safety Division and Workplace of International Affairs and OFAC for their help and cooperation in this investigation.

On March 2, 2022, the Legal professional Basic introduced the launch of Job Drive KleptoCapture, an interagency legislation enforcement task force focused to implementing the sweeping sanctions, export limitations, and economic countermeasures that the United States has imposed, alongside with allies and associates, in reaction to Russia’s unprovoked military services invasion of Ukraine.  The Job Drive will leverage all the Department’s resources and authorities in opposition to initiatives to evade or undermine the economic steps taken by the U.S. federal government in reaction to Russian military services aggression.

This situation is being handled by the Office’s Funds Laundering and Transnational Prison Enterprises Device.  Assistant U.S. Lawyers Jessica Greenwood, Joshua A. Naftalis, and Sheb Swett are in demand of this motion. 

[1] As the introductory phrase signifies, the Grievance, and the description of the Grievance established forth herein, represent only allegations, and each truth explained must be dealt with as an allegation.