Two Men Accused of Smuggling US Electronics Into Russia

(CN) – Two Russian men are facing 52 charges for allegedly masterminding a scheme to smuggle electronic components from the United States to Russia, including computer chips with military uses, federal prosecutors revealed Wednesday.

Russian nationals Valery Kosmachov, 66, and Sergey Vetrov, 66, are accused of conspiring to smuggle U.S.-produced microelectronics through two Estonia-based companies set up as fronts. The two men were able to obtain the components by falsely stating that they would be used by entities in Estonia, according to U.S. Attorney David Anderson in the Northern District of California.

“The components included dual-use programmable computer chips capable of operating in austere environments making them useful in both civilian and military applications,” Anderson said in a statement. “Once in possession of the chips in Estonia, the co-defendants allegedly later smuggled them into the Russian Federation, in part by using laundered funds.”

Kosmachov, also a naturalized citizen of Estonia, was arrested last September in Estonian capital of Tallinn and extradited to the U.S. last week. Prosecutors said Vetrov is still at large.

In addition to being indicted on one count of conspiracy to violate the International Emergency Economic Powers Act and one count of conspiracy to commit international money laundering, the two men and their companies also face 12 additional counts of violating the International Emergency Economic Powers Act, 19 counts of smuggling and 17 counts of international money laundering.

If found guilty, the two could serve up to 20 years for each charge of money laundering and violation of the International Emergency Economic Powers Act, as well as up to 10 years for each charge of smuggling.

Kosmachov is set to remain in federal custody pending his next court appearance on March 28 before U.S. District Judge William Orrick.    

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