Month: April 2022

Source: United States Department of Justice News

Remarks as Delivered

Thank you, Mr. Attorney General, and good morning everyone thank you all for joining us today.

As the Attorney General said, we are here today because of actions the Department of Justice has taken today and in recent weeks — actions that make clear that the same Russian government struggling to defend its unprovoked and unjustified war in Ukraine is also corrupt at its core.

The world has watched with outrage as innocent Ukrainians continue to suffer at the hands of the Russian government. And for decades, the regime has been propped up by pervasive corruption.

The corruption starts at the top: with Vladimir Putin’s oligarch cronies who earned billions of dollars by committing crimes, often at the expense of the Russian people. The crimes of these billionaires in fact facilitate Russia’s unprovoked aggression — and fuel a life of luxury for a very few. The world watches in horror as Ukrainians are forced to flee their homes, schools and hospitals, and as they bury innocent civilians

Last month, the Attorney General asked me to establish a task force — Task Force KleptoCapture — to use the full range of the department’s authorities to hold accountable those oligarchs who enable the Russian regime, and to ensure that those same oligarchs feel the pain of the sanctions that have been levied on them in response to Russia’s aggression in Ukraine.

That task force has been hard at work.

Earlier this week, our law enforcement partners in Spain, acting on our request and pursuant to a warrant issued by a United States Court seized a $90 million yacht — named the Tango — belonging to sanctioned Russian oligarch Viktor Vekselberg. That yacht was subsequently searched by Spanish authorities, accompanied by agents of the FBI and Homeland Security Investigations.

Vekselberg was sanctioned in 2018 by the U.S Treasury Department as part of a suite of sanctions imposed in response to Russia’s invasion of Crimea. Mr. Vekselberg defied these sanctions to finance his luxury lifestyle, including making payments through U.S. banks for the support and maintenance of his yacht — a direct violation of the sanctions imposed on him.

In seizing the Tango, the department demonstrated our commitment to holding accountable corrupt Russian oligarchs — a commitment we are not finished honoring.

Today, charges have also been unsealed in the Southern District of New York against Konstantin Malofeyev, a Russian national and a Russian oligarch. Malofeyev is charged with conspiring to violate and violating United States sanctions. These are the first criminal charges brought by the Department of Justice against a Russian oligarch since Russia invaded Ukraine.

Mr. Malofeyev was designated as a result of the Crimea sanctions, which forbade him from conducting financial transactions with United States persons or with property in the United States. In the years since he was sanctioned, Mr. Malofeyev is alleged to have flagrantly and repeatedly violated the sanctions imposed on him while attempting to establish media companies across Europe, media companies that would help spread pro-Kremlin misinformation.

Mr. Malofeyev further violated U.S. sanctions in a scheme to transfer shares he owned in a Texas bank to a business associate in 2015. Today, in addition to the criminal charges filed against Mr. Malofeyev, we have seized that multi-million-dollar investment.

While the oligarchs provide some of the most ostentatious displays of Russian illicit finance, they are not the only ones whose financial misconduct is tied to Russia.

Yesterday, the Department of Justice disrupted the Hydra Market — the world’s largest and longest-running darknet marketplace.

At the same time, the Department of Justice brought criminal charges against Dmitry Pavlov, a resident of Russia, for his role in operating and administering the servers used to run Hydra. Our partners at the German Federal Criminal Police played a critical role in this operation and seized over $25 million in Bitcoin from Hydra.

And our partners at the Treasury Department announced sanctions on the cryptocurrency exchanges believed to have facilitated many of Hydra’s transactions.

As alleged, Hydra enabled users in mainly Russian-speaking countries to buy and sell a staggering variety of illicit goods and services, including illegal drugs, stolen financial information, fraudulent passports and even hacking tools and hacking services.

Transactions on Hydra were conducted in cryptocurrency, and last year, Hydra alone accounted for an estimated 80% of all darknet market-related cryptocurrency transactions. Since 2015, the marketplace has received approximately $5.2 billion in cryptocurrency.

Let me say that again – Hydra alone accounted for an estimated 80% of all darknet market transactions – more than $5 billion in cryptocurrency.

Working side by side with our German partners — whose assistance was critical to our efforts — as well as our law enforcement partners at the IRS and U.S. Postal Inspection Service here at home — the DEA and the FBI have ensured that cryptocurrency can no longer be used by these criminals to fuel their crimes.

Taken together, these actions make clear that those who violate our laws should expect to face justice.

As Russia and its aggression continues, we have our eyes on every yacht and jet, we have our eyes on every piece of art and real estate purchased with dirty money and on every bitcoin wallet filled with the proceeds of theft and other crimes. Together with our partners around the world, our goal is to ensure that sanctioned Russian oligarchs and cyber criminals will not find safe haven.

And now, I’ll turn it over to Director Wray to discuss another tool employed by the FBI to address Russia’s aggression.

Source: United States Department of Justice News

Remarks as Delivered

Good morning.

When we announced the launch of the KleptoCapture Taskforce last month, I said we would leave no stone unturned in our efforts to investigate, arrest, and prosecute those whose criminal acts enable Russia to continue its unjust war in Ukraine.

That is a promise we are keeping.

I am joined here by Deputy Attorney General Monaco and FBI Director Wray. Also here are Assistant Attorney General Olsen, Principal Deputy Assistant Attorney General McQuaid, FBI Cyber Section Chief Frigm, and KleptoCapture Task Force Director Adams.

Today, we are announcing several actions the Justice Department has taken to disrupt and prosecute criminal activity associated with the Russian regime. 

The first action we are announcing today is the unsealing of an indictment charging Russian oligarch Konstantin Malofeyev with sanctions violations.  

As the indictment charges, the Treasury Department previously identified Malofeyev as one of the main sources of financing for Russians promoting separatism in Crimea, and for providing material support for the so-called Donetsk People’s Republic. 

After being sanctioned by the United States, Malofeyev attempted to evade the sanctions by using co-conspirators to surreptitiously acquire and run media outlets across Europe.

We are also announcing the seizure of millions of dollars from an account at a U.S. financial institution, which the indictment alleges constitutes proceeds traceable to Malofeyev’s sanctions violations.

The Justice Department will continue to use all of its authorities to hold accountable Russian oligarchs and others who seek to evade U.S. sanctions.

The second action we are announcing today is the disruption of a global botnet controlled by the Russian military intelligence agency — commonly known as the GRU.

The Russian government has recently used similar infrastructure to attack Ukrainian targets.

Fortunately, we were able to disrupt this botnet before it could be used. Thanks to our close work with international partners, we were able to detect the infection of thousands of network hardware devices. 

We were then able to disable the GRU’s control over those devices before the botnet could be weaponized.

Today’s announcements are part of a series of actions that the Justice Department has recently taken to disrupt and prosecute criminal activity associated with Russia.

Yesterday, together with our German law enforcement partners, we seized the Russia-affiliated Hydra darknet market — the world’s largest illegal marketplace on the dark web. We also filed criminal charges against a Russian national who we allege administered the market’s technical infrastructure.

And on the day before that — again together with our international partners — we seized the Tango, a superyacht owned by Viktor Vekselberg, another sanctioned oligarch with close ties to the Russian regime.

On that same day, we obtained seizure warrants targeting the assets of several additional sanctioned Russian nationals.

The Justice Department will continue to work alongside our international partners to hold accountable those who break our laws, threaten our national security, and harm our allies. 

Our message to those who continue to enable the Russian regime through their criminal conduct is this:

It does not matter how far you sail your yacht.

It does not matter how well you conceal your assets.

It does not matter how cleverly you write your malware or hide your online activity.

The Justice Department will use every available tool to find you, disrupt your plots, and hold you accountable.

Finally, I cannot close without acknowledging the horrible images that all of us have seen coming out of Ukraine — particularly from Bucha — this week.

We have seen the dead bodies of civilians, some with bound hands, scattered in the streets.

We have seen the mass graves.

We have seen the bombed hospital, theater, and residential apartment buildings.

The world sees what is happening in Ukraine.

The Justice Department sees what is happening in Ukraine.  

This Department has a long history of helping to hold accountable those who perpetrate war crimes. One of my predecessors — Attorney General Robert Jackson — later served as the chief American prosecutor at the Nuremberg Trials. 

Today, we are assisting international efforts to identify and hold accountable those responsible for atrocities in Ukraine. And we will continue to do so.

I am now going to turn over the program to Deputy Attorney General Monaco, who will share more information about the indictment that was unsealed today.

Source: United States Department of Justice News

NEW ORLEANS, LOUISIANA – U.S. Attorney Duane A. Evans announced that on April 5, 2022, CLARENCE SANTIAGO, age 22 from New Orleans, pled guilty to various firearm and drug charges stemming from his participation in a December 28, 2020, shootout at the Jung Hotel on Canal Street. 

Earlier this year, a federal grand jury handed down two related indictments charging a total of seven individuals with various violations of the Federal Gun Control Act and Federal Controlled Substances Acts for participating in this shootout.  Today, SANTIAGO pled guilty to Counts 1, 2, 3, and 4 of the indictment, charging him with participating in a conspiracy to possess firearms in furtherance of a drug trafficking crime (Count 1) pursuant to Title 18, United States Code, Section 924(o); using, carrying and discharging a firearm during and in relation to a drug trafficking crime (Count 2) pursuant to Title 18, United States Code, Section 942(c); conspiracy to possess with the intent to distribute marijuana (Count 3) pursuant to Title 21, United States Code, Section 841(b)(1)(D); and, illegally maintaining a drug involved premises (Count 4) pursuant to Title 21, United States Code, Section 856.

SANTIAGO will be sentenced on July 12, 2022. Based on his guilty plea, he faces the following sentences:

For Count 1, he faces a maximum sentence of up to 20 years in prison, not more than 3 years of supervised release, and not more than a $250,000.00 fine;

For Count 2, he will face a mandatory minimum of 10 years up to a maximum of life imprisonment, not more than 5 years of supervised release, and a fine of not more than $250,000.00.  Any prison sentence imposed in connection with this count must be served consecutively to any other prison sentence imposed in connection with this case;

For Count 3, he will face up to a maximum of 5 years in prison, not less than two years of supervised release, and not more than a $250,000.00 fine; and  

For Count 4, he will face a sentence of not more than 20 years in prison, up to three years of supervised released, a fine of not more than $500,000.00.

SANTIAGO must pay a $100 mandatory special assessment fee for each count of conviction.

This case is being prosecuted as part of the joint federal, state, and local Project Safe Neighborhoods (PSN) Program, the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime.  Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them.  As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

The case was investigated by the New Orleans Police Department and the United States Bureau of Alcohol, Tobacco, Firearms, and Explosives.  Assistant United States Attorneys Maurice Landrieu and Elizabeth Privitera are in charge of the prosecution.

Source: United States Department of Justice News

Swift Investigations, Arrests and Charges Credited to Efforts of Joint Carjacking Task Force

Source: United States Department of Justice News

Defendant found guilty of taking money from union of which he was president and lying on annual financial reports about money he paid himself