Law & Justice

Mountainside Man Sentenced To 70 Months In Prison For Role In Illegal International Procurement Network

989f921d33a737030098_fed1c2e4977e27f6f529_2eafe75589039d6dbb7c_edb89f709ec5a4752ef7_9f8f9ffe25d475a5079f_c70959bae8a00f55ad3d_dc450a998e9135c07018_1003479d4ea60ee00236_55072af69cca9951caf8_stock_image_-_law_revised_-_v1.jpg
989f921d33a737030098_fed1c2e4977e27f6f529_2eafe75589039d6dbb7c_edb89f709ec5a4752ef7_9f8f9ffe25d475a5079f_c70959bae8a00f55ad3d_dc450a998e9135c07018_1003479d4ea60ee00236_55072af69cca9951caf8_stock_image_-_law_revised_-_v1.jpg

NEWARK, NJ – Alexander Brazhnikov Jr., 37 of Mountainside was sentenced on Thursday, June 30 to 70 months in prison for his role in an international procurement network that obtained and smuggled more than $65 million worth of electronics from the United States to Russia in violation of export control laws, U.S. Attorney Paul J. Fishman announced.

Brazhnikov, a naturalized United States citizen born in Moscow, previously pleaded guilty before U.S. District Judge William J. Martini to an information charging him with one count of conspiracy to commit money laundering, one count of conspiracy to smuggle electronics from the United States, and one count of conspiracy to violate the International Emergency Economic Powers Act (IEEPA). Brazhnikov also agreed to the entry of a forfeiture money judgment against him in the amount of $65 million. Judge Martini imposed the sentence today in Newark federal court.

“Brazhnikov was responsible for nearly 2,000 illegal shipments of regulated, sensitive electronics components, many of which wound up in the hands of Russian military and security forces,” U.S. Attorney Fishman said. “He also admitted going to extraordinary lengths to conceal the nature and destination of the shipments, as well to hide the tens of millions of dollars in illegal proceeds generated by the scheme. The sentence imposed on him today reflects the seriousness of his crimes.”

Sign Up for E-News

Brazhnikov Jr. was arrested at his home on June 26, 2014, following a joint investigation by the FBI, the U.S. Department of Commerce (DOC), and the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). From January 2008 through June 2014, he was the owner, chief executive officer, and principal operator of four New Jersey microelectronics export companies, each of which were used in the various conspiracies uncovered by the investigation. Following his arrest, special agents seized $4,075,237 in proceeds related to the charged offenses, as well as real property and other assets valued at more than $600,000.

“Today's sentencing represents a collaborative effort among law enforcement agencies,” Jonathan Carson, Special Agent in Charge of the U.S. Department of Commerce, Bureau of Industry and Security, Office of Export Enforcement, New York Field Office, said. “I commend our colleagues at the FBI and Homeland Security Investigations for their efforts. The Office of Export Enforcement will continue to pursue violators of our export control laws by leveraging our unique authorities to protect national security.”

“HSI will continue to use all the resources at its disposal to prevent sensitive and restricted technology from being exported illegally,” Special Agent in Charge Terence S. Opiola, HSI, Newark, said. “HSI as the principal enforcer of export controls will continue to ensure that sensitive technology doesn’t fall into the wrong hands.”

According to documents filed in this case and statements made in court:

Brazhnikov and his companies are part of a sophisticated procurement network that has surreptitiously acquired large quantities of license-controlled electronic components from American manufacturers and vendors and exported those items to Russia on behalf of Russian business entities that were authorized to supply them to the Ministry of Defense of the Russian Federation, the Federal Security Service of the Russian Federation (the FSB), and Russian entities involved in the design of nuclear warheads, weapons, and tactical platforms.

The defendant conspired with his father, Alexander Brazhnikov Sr., owner of a Moscow-based procurement firm whose agents helped initiate the purchase of electronics components from United States vendors and manufacturers on behalf of the conspirators’ clients in Russia.  Brazhnikov Jr. finalized the purchase and acquisition of the requested components from the various distributors, then repackaged and shipped them to Moscow. He routinely falsified the true identity of the end-user of the components and the true value of the components in order to avoid filling out required export control forms. Brazhnikov Jr. purposefully concealed the true destination of the parts that were exported by directing that the shipments be sent to various “shell” addresses in Russia – some of which have been identified as vacant storefronts and apartments – which were established and controlled by the Moscow-based network. All shipments initially directed to the shell addresses were redirected to a central warehouse controlled by the conspirators’ Moscow-based network.

The funds for the network’s illicit transactions were obtained from the various Russian purchases and initially deposited into one of the conspirators’ primary Russia-based accounts.  Disbursements for purchases were made from that primary Russian account through one or more foreign accounts held by shell corporations  in the British Virgin Islands, Latvia, Marshall Islands, Panama, Ireland, England, United Arab Emirates, and Belize, and ultimately into one of the defendant’s U.S.-based accounts. The network’s creation and use of dozens of bank accounts and shell companies abroad was intended to conceal the true sources of funds in Russia, as well as the identities of the various Russian defense contracting firms receiving U.S. electronics components.

In addition to the prison term and forfeiture, Judge Martini sentenced Brazhnikov to three years of supervised release and fined him $75,000.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark; the U.S. Department of Commerce, under the direction of Special Agent in Charge Carson, New York Field Office; and special agents of HSI, under the direction of Special Agent in Charge Opiola, with the investigation leading to today’s sentencing. He also thanked officers from the Union County Police Department, under the direction of Captain Chris Debbie; and officers of the Mountainside Police Department, under the direction of Police Chief Allan Attanasio, for their important contributions to the investigation. The U.S. Justice Department’s Office of International Affairs provided assistance with this case.

The government is represented by Assistant U.S. Attorneys Dennis C. Carletta of the U.S. Attorney’s Office National Security Unit, and Peter Gaeta of the office’s Asset Forfeiture and Money Laundering Unit in Newark.

TAP Into Another Town's News:

You May Also Be Interested In

Sign Up for E-News

Mountainside

Upcoming Events

Carousel_image_634bcda860ed17650f72_93a8625c-ce9d-413f-a61e-4b2df4fe0604

Tue, July 24, 3:00 PM

Grillestone Restaurant , Scotch Plains

Hear the Story of Amelia Earhart, America's Most ...

Arts & Entertainment Food & Drink

Carousel_image_b91f21bd7ac6c164e408_wednesday_matinees_at_trailside

Wed, July 25, 1:30 PM

Trailside Nature & Science Center, MountainsidE

Trailside’s Annual Summer Wednesday Matinee ...

Arts & Entertainment Education

Wed, July 25, 7:30 PM

Chatham United Methodist Church, Chatham

Masterwork’s Summer Sings Conclude with Verdi ...

Arts & Entertainment

Carousel_image_180fb624cb767a3bedaf_best_crop_7313656ce0929485c104_bh_ribbon_cutting_8_2x

Wed, July 25, 7:30 PM

Memorial Park, Berkeley Heights

2018 Berkeley Heights Summer Concert Series

Arts & Entertainment

Sat, July 28, 8:00 PM

St. John's Lutheran Church, Summit

St. John's Summit Concert Series Presents ...

Arts & Entertainment

Carousel_image_b91f21bd7ac6c164e408_wednesday_matinees_at_trailside

Wed, August 1, 1:30 PM

Trailside Nature & Science Center, MountainsidE

Trailside’s Annual Summer Wednesday Matinee ...

Arts & Entertainment Education

Mayors Push for Law Permitting Driver's License for Immigrants

July 22, 2018

PERTH AMBOY, NJ - Five mayors from northern and central New Jersey today called for passage of a state law permitting immigrants to get driver's licenses even if they are undocumented, saying it boosts public safety as well as the economy.

"This is important for every resident for a better life and a better life for the state of New Jersey," said Perth Amboy Mayor Wilda ...

Drive for Autism Foundation to hold Seventeeth annual Drive for Autism Golf Event

July 23, 2018

NEW PROVIDENCE, NJ – The Drive for Autism Foundation is pleased to announce that its annual golf event Drive for Autism XVII will be held at Royce Brook Golf Club in Hillsborough, NJ on September 17, 2018.

The Drive for Autism Golf Outing which has been held since 2002 has raised and distributed over $700,000 to local school programs. Previous beneficiaries of grants were ...

And Over Here is the Dining Hall 2

My very first job in admissions was while I was still an undergraduate myself as a tour guide.  Very early on they indoctrinated us with some tricks of the trade.  It’s a dining hall, not a cafeteria.  A residence hall, not a dorm.  If you have to divulge some negative bit of information, sandwich it between two positives.  There were instructions for glossing over ...

'Tired of cronyism? Yeah, us too'

July 21, 2018

The Union County Freeholders’ decision to appoint State Senator and newly-elected Union County Democratic Chairman, Nick Scutari’s chief of staff, Ed Oatman as County Manager smelled of corruption from the start. To place a political consultant like Oatman in the role of overseeing 2,800 employees and running the day-to-day operations of the $500 million county budget suggests ...