Three Russia Export Cases Put End-User Diligence in the Spotlight

Three recent Department of Justice cases involving exports to Russia highlight a recurring enforcement theme: U.S. companies cannot assess diversion risk based only on the customer and destination named on an order. The cases arose from efforts to evade export controls and sanctions imposed or tightened after Russia’s full-scale invasion of Ukraine in February 2022. In each case, the defendant used a third-country buyer, consignee or transshipment route that concealed the Russian destination or end user from U.S. suppliers.

Nothing suggests that the U.S. suppliers mentioned in these cases knowingly participated in the defendants’ schemes. However, the cases show that illicit procurement networks often target and deceive legitimate companies, underscoring the need for know-your-customer procedures that extend beyond restricted-party screening. A purchaser that is not itself listed may still be acting as a procurement agent for a foreign government or a sanctioned party. U.S. suppliers of sensitive technology should examine whether the buyer, end user, product, payment source and shipping route make commercial sense when considered together.

Although the cases below are Russia-related, the takeaways are applicable to other sanctions and export controls program, such as those targeting China, Iran, and North Korea.

Diversion in Three Acts
In the first case, a federal jury in the Southern District of Florida convicted Russian national Alexander Mamonov on 12 counts arising from a scheme to export more than $900,000 in U.S. aircraft parts to Russia and the state-owned airline Aeroflot. Following the expansion of Russia-related controls in early 2022 and the Department of Commerce’s issuance of a temporary denial order against Aeroflot, Mamonov and a co-conspirator told U.S. suppliers that the parts were destined for the United Arab Emirates and China, among other countries. DOJ charged Mamonov with violations of the Export Control Reform Act (ECRA), smuggling, money-laundering, conspiracy, and submitting false or misleading export information. Sentencing is scheduled for November 20, 2026.

In the second case, Andrei Samuilovski, a citizen of Estonia, Switzerland and Russia, pleaded guilty in the District of Columbia to conspiring to violate ECRA. Samuilovski co-founded ITC Middle East FZ-LLC in March 2022. From 2022 through September 2024, U.S. companies shipped ITC nearly $2 million in controlled aviation and aerospace goods, which were ultimately reexported to prohibited Russian end users without the required licenses. Samuilovski is scheduled to be sentenced on January 13, 2027.

In the third case, Armenian national Kamo Kirakosyan was sentenced to 26 months in prison for conspiring to export controlled goods, including items used in semiconductor manufacturing, through Armenia to Russia. DOJ described Kirakosyan as a straw purchaser who represented himself to U.S. companies as the Armenian buyer and withheld truthful end-user information from U.S. suppliers, even after suppliers requested end-user statements. The scheme began shortly after the invasion and continued after the Department of the Treasury’s Office of Foreign Assets Control (OFAC) added a Russian company involved in the conspiracy to the Specially Designated Nationals and Blocked Persons List in February 2023. Kirakosyan was extradited from Germany and pleaded guilty in April 2026 to conspiracy to violate ECRA, the International Emergency Economic Powers Act (IEEPA), the Export Administration Regulations (EAR), and to knowingly fail to file required export information.

The Limitations of Single-Tier Screening
The three cases involve different products, routes and procedural outcomes, but the alleged methods are closely related. Each scheme arose after the United States and allies expanded restrictions on exports to Russia. Each used a party outside Russia to obtain U.S.-origin goods. And each depended on U.S. companies receiving an incomplete or false account of the destination or end user.

The cases highlight the shortcomings of relying on list-screening alone to ensure compliance with export-control and sanctions regimes. A customer may clear screening because it has not been designated by OFAC or placed on a Commerce Department restricted-party list. The transaction may nevertheless require a license or be prohibited based on the ultimate destination, end user, end use, ownership or control of a party, or the sender’s knowledge that the goods will be diverted.

The cases also illustrate how risk can change during a relationship. A counterparty may undergo a change in corporate structure, begin using different freight routes, add new payment parties, or become connected to an entity that is later designated. In the Kirakosyan matter, for example, the relevant Russian company was added to the SDN List after the alleged conspiracy began. Screening only at the outset of a customer relationship would not prevent transactions with later-designated counterparties.

Takeaways for U.S. Companies

• Use a risk-based know-your-customer process. Identify the customer, beneficial owners, intermediaries, consignees, end users and intended end use. Consider enhanced diligence when transactions involve controlled goods, newly formed companies, distributors with limited operating history or jurisdictions commonly used to transship goods to prohibited destinations. Pay attention to the foreign connections of your counterparty and its executives, managers and shareholders, regardless of the place of incorporation of the legal entity. Be alert for any signs of unusual requests for secrecy, such as the use of secure messaging applications and in-person meetings for all communications.
• Review the commercial explanation. Confirm that the customer’s business, technical capabilities, staffing, order volume, delivery address and proposed use are consistent with the items purchased. Orders involving sensitive technology may deserve particular attention, but diversion risk is not limited to high-technology products. Where uncertain, consider further indications of reliability such as evidence of work with other reputable clients. Seek to identify evidence of operational activity in the country of incorporation, rather than merely a brokerage or intermediary role.
• Verify destination and end use independently. End-user statements and contractual certifications are important, but effective diligence may also require checking corporate records, websites, ownership information, freight arrangements and other available evidence.
• Keep screening tools updated. Compliance systems should account for changes to OFAC’s SDN List and Commerce’s Consolidated Screening List, including ownership-based sanctions restrictions that may not appear from a name-only search.
• Reevaluate the program when risk changes. Companies should update policies and as laws change, geopolitical conditions shift, new diversion routes emerge, and parties are added to or removed from restricted-party lists. It may be necessary to reassess existing customers when those changes occur.

As U.S. enforcement pressure on markets like Russia and Iran intensify, and sophisticated circumvention evolves, companies should consider enhanced risk-based due diligence like the recommendations above. Of course, these measures complement but do not replace baseline export-control and sanctions policies and procedures.