U.S. Officials Charge Russian Citizen for Smuggling Dual-Use Technology
On Monday, September 16, 2024, Denis Postovoy, a 44-year-old Russian citizen residing in Sarasota, Florida, was arrested in connection with an indictment alleging illegal exports of U.S.-sourced microelectronics to Russia. These microelectronic components have military applications, and their export was carried out without the necessary licenses.
Charges and Allegations: Illegally Exporting Drone Technology
The U.S. Department of Justice charged Postovoy with multiple counts, including violating the Export Control Reform Act, smuggling, money laundering, and defrauding the United States. The indictment, which was announced by U.S. Attorney Matthew M. Graves and Assistant Attorney General Matt Olsen of the National Security Division, alleges that Postovoy began exporting these sensitive components in February 2022, following Russia’s full-scale invasion of Ukraine.
The components exported by Postovoy were intended for use in unmanned aerial vehicles (UAVs), commonly known as drones. The indictment outlines that Postovoy, through his network of companies in Russia, Hong Kong, and other locations, purchased the microelectronics from U.S.-based distributors and illegally shipped them to Russia without obtaining the required licenses from the U.S. Department of Commerce.
According to U.S. Attorney Graves, “This defendant illegally exported dual-use technology to Russia that could bolster its capabilities to wage its unprovoked war against Ukraine. As alleged, he lied about the final destination for the technology he was shipping and used intermediary destinations to mask this illegal activity.”
Concealed Activities and False Documentation
Postovoy is accused of using a variety of methods to hide the true end users of the microelectronics. The indictment details how Postovoy operated companies, including WowCube HK Limited, JST Group Hong Kong, and Jove HK Limited, all based in Hong Kong, and the Vector Group in Russia. He submitted false information on shipping documents to obscure the final destinations of the goods, which were ultimately shipped to Russia through intermediary locations like Hong Kong and Switzerland.
Payments for these shipments were made in U.S. dollars from foreign bank accounts. Postovoy’s companies then transferred the funds through accounts in Russia, Hong Kong, and other locations before making final payments to U.S. suppliers. These transactions were handled through accounts maintained by the suppliers of microelectronics and other sensitive technologies within the United States.
Special Agent in Charge Ryan L. Spradlin of Homeland Security Investigations (HSI) Denver emphasized the importance of uncovering Postovoy’s actions. “This defendant attempted to procure and illegally export dual-use microelectronics with military applications, and ultimately ship them back to Russia. Mr. Postovoy will now face justice for his duplicity.”
Investigation and Coordination
The investigation into Postovoy’s actions is being led by Homeland Security Investigations in Colorado Springs. The U.S. Attorney’s Office for the District of Columbia and the National Security Division’s Counterintelligence and Export Control Section are prosecuting the case. Assistant U.S. Attorney Stuart D. Allen and Trial Attorney Sean R. Heiden are leading the prosecution efforts.
This case falls under the broader scope of efforts coordinated by the Disruptive Technology Strike Force. The Strike Force is an interagency law enforcement initiative that targets illicit actors seeking to acquire critical technology from the U.S. It is co-led by the Departments of Justice and Commerce, with a focus on preventing technology from being obtained by authoritarian regimes and hostile nation-states.
As stated in the US Attorney’s Office press release, “An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.”
Postovoy now faces legal proceedings as authorities continue their efforts to combat illegal exports of sensitive technology.
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Miriam McNabb is the Editor-in-Chief of DRONELIFE and CEO of JobForDrones, a professional drone services marketplace, and a fascinated observer of the emerging drone industry and the regulatory environment for drones. Miriam has penned over 3,000 articles focused on the commercial drone space and is an international speaker and recognized figure in the industry. Miriam has a degree from the University of Chicago and over 20 years of experience in high tech sales and marketing for new technologies.
For drone industry consulting or writing, Email Miriam.
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