Cypriot firms and Belgian businessman sanctioned for helping Russia circumvent sanctions

US authorities sanctioned four Cypriot firms after finding evidence linking them to the sale of material used by Russia in its war against Ukraine.

According to a statement from the US Treasury Department’s Office of Foreign Assets Control (OFAC), these corporations are directly or indirectly aiding the Kremlin’s goals, notably assisting Russia’s invasion of Ukraine.

The Treasury Department said in a statement that the network, led by Belgium-based Hans De Geetere, is involved in procuring electronics with military applications for Russia. It said the network consists of nine entities and five people based in Russia, Belgium, Cyprus, Sweden, Hong Kong, and the Netherlands.

Eriner Limited, The Mother Ark Ltd, Lar Vorto Services Limited, and Ahetei Limited are the companies. Belgian entrepreneur Hans De Geetere, who is also under investigation, is linked to all four firms.

According to US investigators, De Geetere and his network sought to ship electronic products to Russia via Hong Kong, China, and Turkey in certain cases. Russia appears to have exploited the equipment for military objectives.

The US accused the Belgian businessman, who runs Cypriot companies, of being a long-time procurement agent for Moscow, providing Russian clients with parts used in military technology.

Eriner, in particular, has frequently worked with Hong Kong-based M&S Trading to handle orders for electronic components bound for Russia. US investigations have directly linked the aforementioned equipment to technologies detected in Russian unmanned aerial vehicles (drones) used in the invasion of Ukraine.

Hans De Geetere is the CEO of the Cypriot firms Eriner Limited and The Mother Ark Ltd. Several De Geetere enterprises, including Eriner, The Mother Ark, and Ahetei Limited, list Lar Vorto Services Limited in their corporate structure. All four companies have listed Larnaca as their registered office.

On December 5, the United States imposed new Russia-related penalties, targeting a defense procurement network composed of people and businesses in Belgium, Sweden, and Hong Kong, among other places, as Washington tightened down on Moscow’s evasion of Western sanctions imposed over the Ukraine war, Reuters reported.

Concurrent with OFAC’s action, the US Department of Justice unveiled two indictments against Hans De Geetere related to his scheme to circumvent sanctions and export sensitive, military-grade technology from the US to firms in China and the Russian Federation.

“The United States and our allies remain focused on disrupting any attempts by Russia or its trusted agents to gain access to the critical inputs and technologies necessary to support Moscow’s defense industry and facilitate its brutal war in Ukraine”.

Brian Nelson, US Treasury’s undersecretary for terrorism and financial intelligence

Hans De Geetere is a Belgian businessman and long-term Russian procurement dealer who is the director of many firms in Belgium, Cyprus, and the Netherlands. De Geetere has managed the acquisition of electronics for Russian customers, particularly field-programmable gate arrays, which Russia requires for its military programs.

De Geetere and his network have attempted to transport electronics to Russia via transshipment points in Hong Kong, China, and Turkey. Eriner, led by De Geetere, has done business with the Hong Kong-based company M and S Trading on numerous occasions and has coordinated electronics purchases for Russia, including requests for integrated circuits of the same model as those found in Russian war drones retrieved on attack sites in Ukraine.

Lar Vorto Services Limited (Lar Vorto), domiciled in Cyprus, sits on the boards of several De Geetere-led companies. Lar Vorto is in charge of the secretary position at Eriner and The Mother Ark, as well as a third company, Ahetei Limited (Ahetei), which was founded by De Geetere. Ahetei has attempted to purchase accelerometers of American origin, which are dual-purpose devices with aeronautical and military applications.

The Netherlands-based company Hasa Nederland B.V. (Hasa Nederland), registered in both Belgium and the Netherlands, is a subsidiary of The Mother Ark and shares an address with European Trading Technology.

Earlier, Belgian media quoted De Geetere as denying allegations of sanctions circumvention.

De Geetere has had various business interactions with Russian national Vladimir Kulemekov (Kulemekov), including organizing electronics orders for Russian firms. Kulemekov, who previously worked for De Geetere, has been recognized as a member of the Russian GRU military intelligence agency.

Sergey Skvortsov, an acquaintance of Kulemekov, directed a Kulemekov-owned electronics business that was established to promote transactions between China and Russia, with a focus on Sweden-based operations. Skvortsov also ran a separate import-export business that checked electrical components in manufacture. Skvortsov has also purchased electronic equipment for Russian government agencies.

On November 2, 2023, the US Department of the Treasury’s Office of Foreign Assets Control designated 130 new Russian entities and individuals that OFAC identified as supporting Russia’s war in Ukraine by “providing Russia with technology and equipment from third countries.” The US Department of State issued nearly 100 sanctions targeting Russia’s future energy production and revenue, the metals and mining sector, defense procurement, and those involved in supporting the Russian government’s war operations in Ukraine.

Russia has continued to exploit economic relationships with companies in China, the UAE, and Turkey, which have become hubs for exporting, re-exporting, and transshipping Russian dual-use Western technology and equipment, according to the report. OFAC noted that they are continuing to work with partner nations to prevent further Russian sanctions evasion and export control violations.

While the United States and the European Union mobilize to provide Ukrainians with anti-missile systems to defend their cities from Russian missile attacks, Moscow continues to bombard Ukraine with Western technologies.

Failure to prevent Russia from acquiring Western technologies for its armament means postponing Ukraine’s victory and bringing Putin’s war closer to the EU’s frontiers.

Therefore, the US has increased its efforts to crack down on Russia’s attempts to circumvent Western sanctions in order to ensure their enforcement.

Following Russia’s invasion of Ukraine, the United States, European Union, and other Western nations imposed a multitude of sanctions on Moscow, including targeting Russian banks and dictator Putin, as the partners sought to hold Russia accountable for its war that has killed hundreds of thousands and left Ukrainian cities in ruins.

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