Category: US Department of Justice

Source: United States Department of Justice Criminal Division

The Justice Department today announced the release of a new report, an independent review of the use of force policies, procedures, and protocols of the Columbus, Ohio, Division of Police (CDP), as well as the training associated with these policies and operations. The review came at the request of the CDP and was conducted by the Office of Community Oriented Policing Services (COPS Office) and Jensen Hughe, a critical response provider, following the February 2023 release of the COPS Office Columbus (Ohio) Division of Police: Roadmap to Implementation report. This is part of ongoing technical assistance to CDP.

The goal of the report is to highlight areas in need of improvement through a series of findings and recommendations developed for the purpose of overall improvement of organizational efficiency, effectiveness, and performance. The report states that “[t]he overarching theme associated with almost all the recommendations is the need for enhanced technological capabilities. By upgrading technological capabilities, the CDP will be well-situated to optimize its performance and ensure accountability at a much higher level than it is currently able to achieve.” It goes on to say that “[i]ncreased data collection, analysis, and reporting is of the utmost importance at this time for the CDP to become the transparent, community-oriented policing agency the people of Columbus want and deserve.”

“Whenever we support best practices in policing, it benefits both the department and the community it serves,” said Acting Associate Attorney General Benjamin C. Mizer. “Ultimately, the goal of these types of reviews is twofold: to improve the delivery of policing services to the community, and, by doing so, to increase public trust and enhance community-police relationships.”

“Investing in technology that facilitates data collection, analysis, and reporting, and evaluating its effectiveness underscores an agency’s commitment to the public,” said COPS Office Director Hugh T. Clements Jr. “When an agency voluntary asks for this kind of assessment and is interested in making improvements, everyone benefits.”

The report is available at here.

The Critical Response program is designed to provide targeted technical assistance (TA) to state, local, territorial, and Tribal law enforcement agencies experiencing high-profile events, major incidents, or sensitive issues of varying need. Critical Response is highly customizable by providing flexible assistance to law enforcement agencies that have recently experienced a critical incident or identified an issue of significant community concern in their department’s operations. The TA generally falls into three categories: (1) immediate delivery of TA to address a pressing and acute need, (2) data analysis, and (3) after-action reviews to understand and learn from law enforcement and public safety responses to critical incidents or issues.

The COPS Office is the federal component of the Justice Department responsible for advancing community policing nationwide. The only Justice Department agency with policing in its name, The COPS Office was established in 1994 and has been the cornerstone of the nation’s crime fighting strategy with grants, a variety of knowledge resource products, and training and technical assistance. Through the years, the COPS Office has become the go-to organization for law enforcement agencies across the country and continues to listen to the field and provide the resources that are needed to reduce crime and build trust between law enforcement and the communities served. The COPS Office has been appropriated more than $20 billion to advance community policing, including grants awarded to more than 13,000 state, local, territorial, and Tribal law enforcement agencies to fund the hiring and redeployment of approximately 138,000 officers.

Source: United States Department of Justice Criminal Division

Arthur Petrov Allegedly Participated in a Russia-Based Illicit Procurement Network That, Subsequent to Russia’s Invasion of Ukraine, Illegally Procured Large Quantities of Sensitive Microelectronics for a Russian Company That Supplies Manufacturers for the Russian Military

Arthur Petrov, 33, a dual Russian and German national, made his initial appearance in federal court today, following his extradition from the Republic of Cyprus for criminal offenses related to export control violations, smuggling, wire fraud and money laundering. Petrov allegedly participated in a scheme to procure U.S.-sourced microelectronics subject to U.S. export controls on behalf of a Russia-based supplier of critical electronics components for manufacturers supplying weaponry and other equipment to the Russian military. Petrov was arrested on Aug. 26, 2023, in the Republic of Cyprus at the request of the United States.

“Today’s extradition demonstrates the Justice Department’s enduring commitment to cutting Russia off from the western technologies that fuel President Putin’s war machine,” said Deputy Attorney General Lisa Monaco. “Together with global partners, the Department’s Disruptive Technology Strike Force and Task Force KleptoCapture will vigorously investigate and prosecute efforts to evade the global sanctions and export controls imposed to counter Russia’s brutal war in Ukraine. The defendant’s extradition is a vital step towards holding Russia accountable, and I am grateful to our Cypriot partners for their assistance in this matter.”

“Our charges allege that, after Russia’s full-scale invasion of Ukraine, the defendant and his co-conspirators formed an elaborate tech-trafficking syndicate to supply microelectronics to Russia’s military-industrial complex,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “Together with our international law enforcement partners, the Justice Department will now hold Petrov to account in a U.S. courtroom and continue dismantling criminal networks that threaten our collective security.”

“As demonstrated by today’s extradition, just because you’re located overseas doesn’t mean we won’t find you,” said Assistant Secretary for Export Enforcement Matthew S. Axelrod of the Commerce Department’s Bureau of Industry and Security (BIS). “If you procure sensitive U.S. microelectronics with military applications for Russia, you risk the very real threat of facing justice in a U.S. courtroom.”

“Arthur Petrov is alleged to have conspired to smuggle shipments from U.S. distributors of microelectronics with military applications through intermediary countries to Russia as part of an illicit Russian-based procurement network,” said U.S. Attorney Damian Williams for the Southern District of New York. “As alleged, he concealed the ultimate destination of these sensitive materials, and he knew that these transactions and shipments were in violation of U.S. export controls relating to Russia. Thanks to the efforts of our law enforcement partners here and abroad, Petrov is now in U.S. custody and will face justice in a U.S. courtroom. This case demonstrates that we will work tirelessly with our law enforcement partners to protect national security and disrupt and prosecute the illicit supply of U.S.-sourced military technology to Russia.”

“The extradition of Arthur Petrov and the allegations laid out in a criminal complaint send a strong message about the resolve and commitment of the FBI and its partners to stop the illegal transfer of sensitive, military-use technology,” said Executive Assistant Director Robert Wells of the FBI’s National Security Branch. “In the hands of hostile nations, such technology presents a significant threat to U.S. national security. Today’s actions demonstrate the power and reach of law enforcement partnerships to dismantle even the most elaborate schemes while keeping Americans safe in the process.”

According to court documents, Petrov worked for LLC Electrocom VPK (Electrocom), a Russia-based supplier of critical electronics components for manufacturers supplying weaponry and other equipment to the Russian military. Petrov and two co-conspirators (CC-1 and CC-2), who are Russian nationals also working for Electrocom, operated an illicit procurement network in Russia and elsewhere overseas. They fraudulently procured from U.S. distributors large quantities of microelectronics subject to U.S. export controls on behalf of Electrocom. To carry out the scheme, Petrov, CC-1, and CC-2 used shell companies and other deceptive means to conceal that the electronics components were destined for Russia. The technology that Petrov and his co-conspirators have procured in contravention of export controls during the course of the conspiracy have significant military applications and include various types of electronics components of the sort that have been recovered in Russian military hardware on the battlefield in Ukraine, such as Russian guided missiles, drones and electronic warfare and communications devices.

To perpetrate the scheme, Petrov first acquired the controlled microelectronics from U.S.-based electronics exporters using a Cyprus-based shell company, Astrafteros Technokosmos LTD (Astrafteros), which he operates. Petrov procured these sensitive electronics components by falsely representing to the U.S. exporters that Astrafteros was purchasing the items for fire security systems, among other commercial uses, and that the ultimate end-users and destinations of the electronics are companies in Cyprus or other third countries — when in fact, the components are destined for Electrocom in Russia, which supplies manufacturers for the Russian military. The microelectronics that Petrov has procured as part of the conspiracy include, among other things, microcontrollers and integrated circuits that are on the Commerce Control List maintained by the Commerce Department and cannot lawfully be exported or reexported to Russia without a license from the Commerce Department. Invoices provided to Petrov by the U.S. distributors expressly noted that these microcontrollers and integrated circuits are subject to U.S. export controls.

To evade these controls, Petrov, CC-1, and CC-2 worked together to transship the controlled items procured by Petrov using pass-through entities operated by CC-1 and CC-2 in third countries. CC-1 and CC-2 then caused the items to be shipped, sometimes through yet another country, to the ultimate destination: Electrocom in Saint Petersburg, Russia. At all times, Petrov, CC-1, and CC-2 concealed from the U.S. distributors that they were procuring the controlled electronics components on behalf of Electrocom and that the items were destined for Russia. During the course of the conspiracy, Petrov, CC-1, and CC-2 procured from U.S. distributors and shipped to Russia more than $225,000 worth of controlled electronics components with military applications.

On Aug. 26, 2023, Petrov was arrested and detained by the Cypriot authorities at the request of the United States. The United States thereafter submitted a formal extradition request. On July 18, after extradition proceedings in the Cypriot courts concluded with extradition being approved, the Cypriot Minister of Justice and Public Order issued the extradition order.

Petrov is charged with one count of conspiracy to defraud the United States, which carries a maximum penalty of five years in prison; one count of conspiracy to violate the Export Control Reform Act (ECRA), which carries a maximum penalty of 20 years in prison; three counts of violating the ECRA, each of which carries a maximum penalty of 20 years in prison; one count of conspiracy to smuggle goods from the United States, which carries a maximum penalty of five years in prison; three counts of smuggling goods from the United States, which each carry a maximum penalty of 10 years in prison; one count of conspiracy to commit wire fraud, which carries a maximum penalty of 20 years in prison; and one count of conspiracy to commit money laundering, which carries a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant U.S. Attorney Kevin Sullivan for the Southern District of New York and Trial Attorney Maria Fedor of the National Security Division’s Counterintelligence and Export Control Section are prosecuting the case.

Today’s actions were coordinated through the Justice Department’s Task Force KleptoCapture and the Justice and Commerce Departments’ Disruptive Technology Strike Force. Task Force KleptoCapture is an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export restrictions and economic countermeasures that the United States has imposed, along with its allies and partners, in response to Russia’s unprovoked military invasion of Ukraine. The Disruptive Technology Strike Force is an interagency law enforcement strike force co-led by the Departments of Justice and Commerce designed to target illicit actors, protect supply chains and prevent critical technology from being acquired by authoritarian regimes and hostile nation states.

A criminal complaint is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Source: United States Department of Justice Criminal Division

The Justice Department announced today that it will monitor compliance with federal voting rights laws in Hawaii for the Aug. 10 primary election. The department will monitor in Honolulu County and Maui County.

The Justice Department enforces the federal voting rights laws that protect the rights of all citizens to access the ballot. The department regularly deploys its staff to monitor for compliance with federal civil rights laws in elections in communities all across the country. In addition, the division also deploys federal observers from the Office of Personnel Management, where authorized by federal court order. 

The Civil Rights Division’s Voting Section, working with U.S. Attorneys’ Offices, enforces the civil provisions of federal statutes that protect the right to vote, including the Voting Rights Act, National Voter Registration Act, Help America Vote Act, Civil Rights Act and Uniformed and Overseas Citizens Absentee Voting Act.

More information about voting and elections is available on the Justice Department’s website at www.justice.gov/voting. Learn more about the Voting Rights Act and other federal voting laws at www.justice.gov/crt/voting-section. Complaints about possible violations of federal voting rights laws can be submitted through the Civil Rights Division’s website at civilrights.justice.gov or by telephone at 1-800-253-3931.

Source: United States Department of Justice Criminal Division

A federal grand jury in Oklahoma City returned an indictment, which was unsealed today, charging Sioux Erosion Control, Inc. (Sioux), its vice president and another employee with a price-fixing conspiracy targeting over $100 million in publicly-funded transportation construction contracts across Oklahoma.

According to court documents, it is alleged that Vice President BG Dale Biscoe, Randall David Shelton and Sioux conspired with their competitors in the erosion control industry to raise and maintain prices for products and services from approximately September 2017 through April 2023. Erosion control products and services, including sod, are used to control runoff of soil or rock on highway construction and repair projects. In addition to conspiring to raise prices for sod, it is alleged that the defendants and their co‑conspirators agreed to divide up contracts across different areas of Oklahoma and rigged bids for particular projects by submitting intentionally high-priced bids or outright refusing to bid.

“Protecting competition for taxpayer-funded infrastructure projects remains a priority for the Antitrust Division,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “This indictment shows the Justice Department and its Procurement Collusion Strike Force partners’ commitment to protecting taxpayer dollars throughout Oklahoma and across the country from brazen collusion.”

“My office is committed to root out price-fixing, collusion and fraud in taxpayer-funded projects,” said U.S. Attorney Robert J. Troester for the Western District of Oklahoma. “We are proud to work with our law enforcement partners in this effort to protect integrity in publicly-funded ventures and preserve the public trust.”

“Today’s announcement represents the FBI’s commitment to protecting competitive markets from those who try to cheat the system,” said Acting Special Agent in Charge Joseph Skarda of the FBI Oklahoma City Field Office. “We will continue to work alongside our law enforcement partners to uncover these harmful schemes and hold the perpetrators responsible.”

“Violations of the nation’s antitrust laws will be taken seriously and those who circumvent federal bidding and contract regulations will be held accountable,” said Special Agent in Charge Joseph Harris of the Department of Transportation Office of Inspector General (DOT-OIG), Southern Region. “This investigation demonstrates our commitment to working with our law enforcement and prosecutorial partners to uproot and expose brazen fraud schemes devised purely for personal gain.”

Four individuals — including a former Sioux employee — previously pleaded guilty for their roles in the charged conspiracy. Those individuals have not yet been sentenced.

Biscoe, Shelton and Sioux are charged with a violation of Section 1 of the Sherman Act. The maximum penalty for individuals is 10 years in prison and a $1 million criminal fine. The maximum penalty for corporations is a $100 million criminal fine. If convicted, a federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The DOT-OIG and FBI Oklahoma City Field Office investigated the case.

Trial Attorneys Bethany Lipman, Matthew Grisier and Marc Hedrich of the Antitrust Division’s Washington Criminal Section and Assistant U.S. Attorney Charles Brown for the Western District of Oklahoma are prosecuting the case.

Anyone with information about this investigation or other procurement fraud schemes should notify the Procurement Collusion Strike Force (PCSF) at www.justice.gov/atr/webform/pcsf-citizen-complaint. The Justice Department created the PCSF in November 2019. It is a joint law enforcement effort to combat antitrust crimes and related fraudulent schemes that impact government procurement, grant and program funding at all levels of government – federal, state and local. For more information, visit www.justice.gov/procurement-collusion-strike-force.

An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Source: United States Department of Justice Criminal Division

A federal jury in Brooklyn, New York, convicted the former Finance Minister of Mozambique for his role in a $2 billion fraud, bribery, and money laundering scheme that victimized investors in the United States and elsewhere.

According to court documents and evidence presented at trial, Manuel Chang, 68, of Mozambique, received $7 million in bribes in exchange for signing guarantees on behalf of the Republic of Mozambique to secure funding for three loans for maritime projects. As part of the scheme, Chang and his co-conspirators falsely told banks and investors that the loan proceeds would be used for the projects and not to pay bribes to government officials. In fact, however, Chang and his co-conspirators diverted more than $200 million of the loan proceeds that were used, among other things, to pay bribes and kickbacks to Chang and others.

“While serving as Finance Minister of Mozambique, Manuel Chang obtained $7 million in bribe payments in exchange for signing guarantees to secure more than $2 billion in loans,” said Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division. “Not only did Chang’s abuse of authority betray the trust of the Mozambican people, but his corrupt bargain also caused investors—including U.S. investors—to suffer substantial losses on those loans. Chang’s conviction today demonstrates that the Criminal Division is committed to combatting foreign corruption in violation of U.S. law, no matter where these schemes occur or whom they involve.”

The trial evidence showed that, between approximately 2013 and 2015, Chang, together with his co-conspirators—including executives of Privinvest Group, a United Arab Emirates-based shipbuilding company—ensured that a United Kingdom subsidiary of Credit Suisse AG and another foreign investment bank arranged for more than $2 billion to be extended to companies owned and controlled by the Mozambican government: Proindicus S.A. (Proindicus), Empresa Moçambicana de Atum, S.A. (EMATUM), and Mozambique Asset Management (MAM). The proceeds of the loans were intended to fund three maritime projects for which Privinvest was to provide the equipment and services.

“Today’s verdict is an inspiring victory for justice and the people of Mozambique who were betrayed by the defendant, a corrupt, high-ranking government official whose greed and self-interest sold out one of the poorest countries in the world,” said U.S. Attorney Breon Peace for the Eastern District of New York. “Chang now stands convicted of pocketing millions in bribes to approve projects that ultimately failed, laundering the money, and leaving investors and Mozambique stuck with the bill.”

Chang and his co-conspirators illegally facilitated Privinvest’s diversion of more than $200 million of the loan proceeds to bribes and kickbacks. These funds included more than $150 million that Privinvest used to bribe Chang and other Mozambican government officials to ensure that companies owned and controlled by the Mozambican government entered into the loan arrangements, and that the government of Mozambique guaranteed those loans. The loans were subsequently sold in whole or in part to investors worldwide, including in the United States. In so doing, the participants defrauded these investors by misrepresenting how the loan proceeds would be used. Ultimately, Proindicus, EMATUM, and MAM each defaulted on their loans and proceeded to miss more than $700 million in loan payments, causing substantial losses to investors.

The jury convicted Chang of one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering. He faces a maximum penalty of 20 years in prison on each count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

In October 2021, Credit Suisse AG and CSSEL (together, Credit Suisse) admitted to defrauding U.S. and international investors in the financing of an $850 million loan for the EMATUM project. CSSEL pleaded guilty to conspiracy to commit wire fraud and Credit Suisse AG entered into a deferred prosecution agreement with the Criminal Division’s Fraud Section and Money Laundering and Asset Recovery Section (MLARS), and the U.S. Attorney’s Office for the Eastern District of New York. As a part of the resolution, Credit Suisse paid approximately $475 million in penalties, fines, and disgorgement as part of coordinated resolutions with criminal and civil authorities in the United States and the United Kingdom.

The FBI New York Field Office investigated the case. 

Trial Attorney Peter Cooch of the Criminal Division’s Fraud Section, MLARS Trial Attorney Morgan Cohen, and Assistant U.S. Attorneys Hiral D. Mehta, Genny Ngai, and Jonathan Siegel for the Eastern District of New York are prosecuting the case.

The Justice Department’s Office of International Affairs provided substantial assistance. The Justice Department also appreciates the assistance of South African authorities, particularly those in the South African Department of Justice and Constitutional Development, as well as authorities in the United Kingdom, Switzerland, Spain, and Portugal.

MLARS’ Bank Integrity Unit investigates and prosecutes banks and other financial institutions, including their officers, managers, and employees, whose actions threaten the integrity of the individual institution or the wider financial system.

The Fraud Section is responsible for investigating and prosecuting Foreign Corrupt Practices Act (FCPA) and Foreign Extortion Prevention Act (FEPA) matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.