On Wednesday, July 17, a judge at the Southern District Court in New York, USA, sentenced a Russian man who was charged with smuggling large quantities of US-made military-grade microelectronic products to Russia to three years in prison, plus three years of supervised release.
Maxim Marchenko, a 52-year-old Russian citizen who has been living in Hong Kong, was arrested by the US in September 2023.
The US Department of Justice stated in a press release that Marchenko and two Russian accomplices were accused of operating an illegal procurement network in Russia, Hong Kong, and other overseas locations. They purchased controlled technical goods worth hundreds of thousands of dollars.
This procurement network acted on behalf of Russian end-users and fraudulently obtained a large number of dual-use microelectronic products, especially OLED microdisplays, from US distributors. OLED microdisplays have significant military applications and can be used in rifle scopes, night vision devices, thermal imaging scopes, and other weapon systems.
Marchenko and his two partners used a shell company based in Hong Kong to conceal from US government agencies and American distributors the fact that the purchased goods were being shipped to Russia. They falsely claimed that these dual-use technology products would be shipped to China, Hong Kong, and other locations for electron microscopes used in medical research.
In February of this year, Marchenko pleaded guilty to two charges, including money laundering and smuggling goods from the US.
Since Moscow began its invasion of Ukraine in February 2022, the US and its allies have imposed multiple rounds of sanctions on Russia to weaken its military capabilities. To circumvent these sanctions, Moscow often imports the products it needs through third countries such as China.
US Assistant Attorney General Matthew G. Olsen stated, “The defendant and others used their business skills and relationships to advance Russia’s war agenda. The Department of Justice will continue steadfastly to dismantle the illegal procurement network they lead.”
Matthew S. Axelrod, Assistant Secretary of Commerce for Export Enforcement at the Bureau of Industry and Security (BIS), said, “Transferring military-grade microelectronic products through Hong Kong helps power Russia’s war machine. Today’s verdict is just the latest evidence of our ongoing efforts to combat and disrupt Russia’s illegal procurement networks.”