Russians may be beating sanctions, but the US is watching
Yevgeny Prigozhin, the leader of the Wagner Group, has been missing since he led his march to Moscow. He was thought to be in Belarus. This is partly because business jets controlled by him flew there shortly after he cancelled the coup.
His Embraer Legacy (RA-0279) flew from Rostov-on-Don near the border with Ukraine to an airport near Minsk, the capital of Belarus. A Hawker 800XP he also owns flew from St Petersburg to Minsk and then onto Moscow.
These flights do not guarantee that he is in Belarus. (Aleksander Lukashenko, president of Belarus, denies Prigozhin is in his country, saying he is in St Petersburg or Moscow). Either way, the flights do prove something else: Russian business jet operators are successfully breaking sanctions stopping the import of aircraft parts.
The US first sanctioned Prigozhin in 2016, according to our Semaphore Intel sanctions database. Both these aircraft have also been sanctioned. The US Treasury Department’s Office of Foreign Assets Control (OFAC) targeted three aircraft and one yacht owned by Prigozhin in 2019. This was after a business he owned was accused of trying to influence the US election by trolling social media.
“Treasury is targeting the private planes, yacht and associated front companies of Yevgeny Prigozhin, the Russian financier behind the Internet Research Agency and its attempts to subvert American democratic processes,” said Steven Mnuchin, Secretary of the Treasury, in 2019. “Free and fair elections are the cornerstone of American democracy, and we will use our authorities against anyone seeking to undermine our processes and subversively influence voters.”
Prigozhin’s team quickly moved the assets from offshore registries to the Russian aircraft registry. But that did affect the sanctions. These aircraft are considered ‘blocked property’ so can no longer be supported by any US company. No manufacturer will support these aircraft in any way. Sanctions following the invasion of Ukraine by Russia in 2022 have made things even stricter. Manufacturers are being extremely careful to not support any aircraft controlled by Russians.
But the fleet keeps flying.
“There are a few people in Dubai and South Africa who are making a lot of money getting parts into Russia,” says one market insider based in the Middle East. Both countries have remained largely neutral following the invasion. He adds: “They know exactly what they are doing and are happy to take the risk.”
The risks are significant. In May, two Russians living in Florida – Oleg Patsulya and Vasilii Besedin – were arrested and charged with conspiracy to violate the Export Control Reform Act and conspiracy to commit international money laundering. Patsulya owned MIC P&I, a Miami aircraft parts company. Besedin worked for it.
The US Bureau of Industry and Security (BIS) says the company emailed Russian airlines offering to help break sanctions by sourcing aircraft parts. “In light of the sanctions imposed against the Russian Federation, we have been successfully solving challenges at hand,” said one email sent by Patsulya, according to court documents. The prosecution said they planned to ship parts from the US to Russia by moving them through Turkey or the Maldives.
Patsulya apparently approached one US aircraft parts supplier in September 2022. When he received an automated email saying the company would not provide parts to any customer in Russia, he forwarded it on saying: “Do not write to these freaks.”
The case is focused on the company attempting to ship US made brake assembly units and aircraft landing gear parts to a Russian airline. If convicted, they could each face up to 20 years in prison for breaking export controls and another 20 years for money laundering.
The investigation was led by the BIS and the FBI. It also involved Homeland Security, Customs and Border Protection and the US Marshals. It was coordinated through the Justice Department’s Task Force KleptoCapture which was set up following the invasion of Ukraine.
Patsulya apparently approached one US aircraft parts supplier in September 2022. When he recieved an automated email saying the company would not provide parts to any customer in Russia, he forwarded it on saying: “Do not write to these freaks.”
The case is focused on the company attempting to ship US made brake assembly units and aircraft landing gear parts to a Russian airline. If convicted, they could each face up to 20 years in prison for breaking export controls and another 20 years for money laundering.
The investigation was led by the BIS and the FBI. It also involved Homeland Security, Customs and Border Protection and the US Marshals. It was coordinated through the Justice Department’s Task Force KleptoCapture, which was set up following the invasion of Ukraine.
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