Export Technology to Russia – Now Facing Federal Criminal Charges

Export Technology to Russia – Now Facing Federal Criminal Charges

You’ve been running a successful technology business for years. Maybe you import and export electronics. Maybe you have connections to suppliers in Russia. Maybe you’ve helped Russian companies acquire components they couldn’t get directly. Now federal agents are at your door, and what you thought was normal international business is being called federal export control violation – a crime that carries up to 20 years in prison per count.

You’re terrified. You’re confused. You thought you were just selling electronics, components, technology that anyone can buy. You didn’t think you were doing anything illegal. You certainly didn’t think you were facing the same charges as arms dealers and weapons traffickers.

If you’re a Russian-American facing this situation, you need to understand something immediately: the federal government doesn’t see your technology business the way you see it. They see a procurement network. They see someone helping Russia acquire sensitive technology. And they’ve probably been watching you for years before knocking on your door.

Three Agencies Are Investigating You Right Now

OK so heres something that most people facing export charges dont understand, and its probly the most important thing in this entire article.

Your not facing one federal agency. Your facing three.

The Bureau of Industry and Security (BIS) under the Commerce Department enforces the Export Administration Regulations (EAR). If you exported “dual-use” technology – things that have both civilian and military applications – BIS has jurisdiction.

The Office of Foreign Assets Control (OFAC) under the Treasury Department enforces economic sanctions. If you did business with sanctioned Russian entities or individuals, OFAC has jurisdiction.

The Directorate of Defense Trade Controls (DDTC) under the State Department enforces the International Traffic in Arms Regulations (ITAR). If any of your exports touched defense articles, DDTC has jurisdiction.

Heres the kicker – they can all investigate you simultaneously for the same transaction. One shipment of electronics to Russia can trigger criminal exposure under EAR, civil penalties under OFAC, and ITAR violations if any components were defense-related.

You dont face one investigation. You face three overlapping investigations with three sets of penalties.

And it gets worse. Since February 2023, the Department of Justice and the Commerce Department have operated something called the “Disruptive Technology Strike Force.” This is a dedicated unit specifically created to prosecute people like you – people they believe are helping hostile nations acquire American technology.

The Strike Force has charged 34 defendants in 24 cases. Most of those cases involve Russia. Most involve people who thought they were running legitimate businesses.

The “Deemed Export” Trap

Heres something that catches alot of Russian-American business owners completely off guard.

You can commit a federal export violation without anything ever leaving the United States.

Its called a “deemed export.” Under federal export control law, if you share controlled technology with a foreign national inside the US – even an employee, even a business partner, even someone who lives here legally – thats considered an “export” to that persons home country.

Think about what this means. If you have a Russian employee at your company, and that employee has access to controlled technical information, you may have committed a “deemed export” to Russia. If you discussed technical specifications with a Russian business partner over lunch in New York, you may have committed a “deemed export.”

You didnt ship anything. You didnt send anything overseas. You just shared information with someone who was born in Russia – and thats enough for federal prosecution.

This catches Russian-American business owners constantly. There running companies with other Russian immigrants, sharing information naturally the way any business does, never realizing that every technical conversation could be a federal crime without the right licenses.

And guess what? If you didnt have licenses for those “deemed exports” – and you probly didnt even know you needed them – your now exposed to the same criminal penalties as someone who physically shipped weapons overseas.

Where Your Components Ended Up

Heres the part of export cases that destroys defendants in front of juries.

The government dosent just charge you with violating export regulations. They show the jury exactly were your technology went.

In multiple recent prosecutions, federal prosecutors have introduced photographs of American electronics found in seized Russian military equipment on Ukrainian battlefields. They show drone wreckage with American microchips inside. They show electronic warfare systems with American components. They show tanks and helicopters containing American technology.

Then they connect those components to you.

Nikolay Goltsev, a Canadian who operated with a co-conspirator in Brooklyn, was recently convicted in an export control case. The government showed that electronic components he shipped were found in Russian drones, tanks, the RB-301B “Borisoglebsk-2” electronic warfare complex, and Ka-52 helicopters – all recovered in Ukraine.

Think about how that plays to a jury. Your not just someone who violated export paperwork. Your someone who armed Russia during an active war. Your someone whose technology killed people.

Even if thats not what you intended – even if you never imagined were your components would end up – thats the story prosecutors will tell. And juries tend to beleive it.

Why “I Didn’t Know” Almost Never Works

Alot of defendants in export cases think they have a simple defense: “I didnt know this was illegal. I didnt know these items were controlled. I didnt know they were going to Russia.”

This defense almost never works. Heres why.

First, export control law uses a “knew or should have known” standard. If a reasonable person in your position should have known that the items were controlled or that Russia was the ultimate destination, your liable – even if you claim you didnt actualy know.

Second, prosecutors use something called “willful blindness.” If you deliberately avoided finding out information that would have told you the export was illegal – if you “stuck your head in the sand” – thats legally equivalent to actual knowledge.

Did a customer pay unusual prices? Did they ask you to ship through third countries? Did they want you to remove identifying labels? Did they pay through shell companies or unusual channels?

If any of these “red flags” were present and you ignored them, prosecutors will argue you were willfully blind. The jury will be told that you chose not to know because knowing would have stopped the profitable business.

Third, Russian-American defendants face a specific problem. Prosecutors often argue that your background means you should have been especialy aware of export control issues with Russia. Your not a naive American who dosent understand international tensions – your someone with direct connections to Russia who knew exactly what was happening.

This isnt fair. But its how these cases are prosecuted.

What Actually Happens in Federal Court

Heres what your facing if your charged with federal export control violations.

Oleg Patsulya, a Russian national, was sentenced to 70 months – nearly six years – in federal prison for his role in an export control scheme involving aviation technology. He thought he was running a legitimate business.

Vadim Yermolenko, a New Jersey resident who was a dual US and Russian national, was sentenced to 30 months. Prosecutors showed that more than $12 million passed through accounts he controlled as part of a procurement network.

Ilya Khan, a 66-year-old with citizenship in the US, Israel, and Russia, pled guilty and faces up to 20 years. The government showed he recieved more than $50 million from sanctioned Russian entities over a decade.

These arnt arms dealers. These are businesspeople who thought they were operating legitimately – until they werent.

The conviction rate in export control cases is extremly high. Once charged, most defendants either plead guilty or lose at trial. The paper trail is usually devastating – wire transfers, shipping records, communications, all preserved in databases you never knew existed.

Sentencing depends on the value of the exports, the nature of the technology, and were it ended up. If prosecutors can show your technology went to Russian military end-users – especialy if they can tie it to the war in Ukraine – sentences are harsh.

Immigration Consequences You Havent Considered

For Russian-American defendants, export control convictions carry a consequence beyond prison that many people dont think about until its too late.

Export control violations are almost always charged as felonies. Federal felony convictions – especialy those involving national security – often qualify as “aggravated felonies” under immigration law.

An aggravated felony conviction means:

Mandatory deportation proceedings. Even if youve been a lawful permanent resident for decades, even if you have American children, even if your entire life is here – you face removal.

No cancellation of removal. The usual relief that long-term residents can request from an immigration judge is unavailable for aggravated felony convictions.

Permanent bars to reentry. If you leave or are deported, you may be permanently barred from returning to the United States.

This is why many Russian-American defendants in export cases prioritize avoiding convictions that trigger immigration consequences over almost everything else. A plea deal that avoids the “aggravated felony” classification might mean the difference between prison-then-continuing-life and prison-then-deportation.

Your defense attorney needs to understand both federal criminal law AND immigration consequences. Many criminal defense attorneys dont think about this, and that oversight can destroy your life permanantly.

The Wire Transfers They’ve Been Watching

Heres something that shocks defendants when they finally see discovery in there case.

The government has probly been watching your money for years.

Banks file Suspicious Activity Reports (SARs) on international wire transfers that raise red flags. Transfers to or from Russia. Transfers through shell companies. Transfers that dont match the stated purpose. Transfers to sanctioned entities or countries.

You never saw these reports. You never knew they were being filed. But they went to FinCEN – the Financial Crimes Enforcement Network – were they sat in a database, building a picture of your financial activity.

Task Force KleptoCapture, the interagency task force dedicated to enforcing Russia sanctions, has access to this data. So does the Disruptive Technology Strike Force. By the time they knock on your door, they already know every wire transfer, every shell company, every unusual payment pattern.

This is why defendants are often shocked by how much the government knows. Your bank records, your shipping records, your communications – its all been collected and analyzed long before you became aware of any investigation.

How These Investigations Actually Start

Alot of defendants wonder how they got on the governments radar in the first place. Heres how export control investigations typically begin.

Bank reports. Banks are required to file Suspicious Activity Reports on unusual international transfers. Payments to or from Russia, payments through third countries, payments that dont match invoice descriptions – all get flagged. These reports go to federal databases were they sit until someone connects the dots.

Shipping company records. Customs and Border Protection monitors exports. When you ship electronics to certain destinations, or when you ship through unusual routes, it gets noticed. Freight forwarders are required to report red flags.

Foreign intelligence. US intelligence agencies monitor Russian procurement networks. If your company appears in communications intercepted overseas, you become a target.

Informants and cooperators. Someone else in the supply chain gets caught and starts cooperating. They name everyone they worked with. Your name comes up.

Industry tips. Competitors, disgruntled employees, even legitimate manufacturers who notice unusual purchase patterns – they report to BIS.

By the time agents show up at your door, theyve probly been building a case for months or years. There not fishing. There confirming what they already suspect.

The Voluntary Self-Disclosure Question

Some attorneys advise clients to make voluntary self-disclosures to BIS or OFAC when they discover potential violations. This is a complicated decision that depends heavily on your specific situation.

Voluntary self-disclosure can reduce penalties – sometimes significantly. Both BIS and OFAC have policies that provide credit for companies that come forward on there own, before the government discovers violations independantly.

But theres a massive catch.

When you make a voluntary disclosure, your admitting to a violation. Your providing the government with evidence. If the disclosure isnt handled exactly right, your basicly building the case against yourself.

And theres no guarantee the government will treat it as purely administrative. If the violations are serious enough – if they involve Russia, if theres evidence of willfulness, if the amounts are large – criminal referral is still possible even after a voluntary disclosure.

This is not a decision to make without experienced counsel. The wrong move here can transform a situation the government didnt know about into a federal prosecution.

What If Youve Already Talked to Investigators

Maybe your reading this after youve already had conversations with federal agents. Maybe you already answered questions. Maybe you already showed them documents. Maybe you already made statements you regret.

Its not too late to limit the damage.

If you talked but didnt incriminate yourself directly

Get an attorney immediatly. Tell them exactly what you said. They can evaluate wheather your statements created problems and develop a strategy going forward.

If you made admissions

Those admissions exist. You cant unsay them. But an experienced attorney can sometimes limit there impact – challenging the circumstances, the context, wheather you were properly advised of your rights.

If you provided documents

Document production creates its own issues. An attorney can evaluate what you provided and what exposure it created.

The worst thing you can do now is continue talking without protection. Every additional conversation creates more opportunities for problems. Get counsel and stop talking immediatly.

Three Mistakes That Make Everything Worse

When Russian-American business owners learn there under investigation for export violations, they often make there situation dramatically worse. Here are the three biggest mistakes.

Mistake 1: Talking to federal agents

This is the most common and most damaging mistake. When BIS agents or FBI agents show up, your instinct is to explain. “If I just tell them what happened, theyll see it was all legitimate.”

They wont see that. There not there to exonerate you. There there to gather evidence.

Every statement you make can be used against you. If you say something that contradicts there records, thats a false statement – additional charges under 18 USC 1001. If you explain your business, your providing a roadmap for prosecution.

The only thing you should say: “I want to speak with an attorney before answering any questions.”

Mistake 2: Destroying records

Some business owners, when they learn there being investigated, panic and start destroying records. They delete emails, shred documents, wipe computers.

This is obstruction of justice. Its a seperate federal crime. And the government often already has copies – from your banks, from shipping companies, from the other side of your transactions.

Destroying evidence dosent make your export case go away. It adds federal obstruction charges on top.

Mistake 3: Continuing business operations

If your under investigation and you continue the same export activities that triggered the investigation, your making things dramatically worse. Your showing ongoing criminal intent. Your adding more counts to the indictment.

The moment you learn of an investigation, your business practices need to change immediatly – under attorney guidance.

What To Do Right Now

If youve been contacted by federal agents about export control violations – wheather BIS, FBI, Homeland Security, or anyone else – heres what you need to do immediatly.

Step 1: Stop talking.

Dont answer questions. Dont explain your business. Dont try to show them your legitimate. Politely decline to discuss anything until you have legal representation.

Step 2: Get a federal criminal defense attorney with export control experiance.

This is a specialized area. You need someone who understands export control law, who knows how these cases are investigated and prosecuted, who can evaluate wheather the government actually has a valid case.

Step 3: Suspend relevant business operations.

Under your attorneys guidance, you may need to halt any export-related activities immediatly. Continuing operations under investigation only makes things worse.

Step 4: Preserve all records.

Dont destroy anything. Dont alter anything. Dont “clean up” your files. Destruction of evidence is a seperate crime that will make your situation much worse.

Step 5: Understand your exposure.

Through your attorney, you can evaluate what the government probly knows, what there likely theory of prosecution is, and what your realistic options are – including wheather voluntary self-disclosure might reduce penalties.

Being investigated for export control violations is terrifying. The penalties are severe, the government resources are vast, and the political environment around Russia makes these prosecutions high-priority. But the worst thing you can do is make decisions without understanding the full picture.

Silence, experienced counsel, and strategic decision-making are your only real protection. The stakes are too high for anything less. Use all three.