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US Charges Ukrainian 'Russian Agent' With Money Laundering


FILE - Ukrainian lawmaker Andrii Derkach attends a news conference in Kyiv, Ukraine, Oct. 9, 2019.
FILE - Ukrainian lawmaker Andrii Derkach attends a news conference in Kyiv, Ukraine, Oct. 9, 2019.

A Ukrainian politician and businessman accused of being a Russian agent and seeking to influence the 2020 U.S. presidential election has been charged with money laundering and other crimes in connection with his purchase of two Beverly Hills condominiums nearly a decade ago, the Justice Department announced Wednesday.

Andrii Derkach, a former member of Ukraine's parliament who was sanctioned by the U.S. Treasury Department in 2020 for his efforts to spread disinformation about then-Democratic presidential candidate Joe Biden ahead of the 2020 vote, is accused of using shell corporations to hide his purchase of the two properties for more than $3 million, according to a seven-count indictment unsealed on Wednesday.

Derkach, 55, was allegedly "an active Russian agent for over a decade, maintaining close connections with the Russian Intelligence Services," and "waged a covert influence campaign" to undermine the 2020 presidential election, the Treasury Department said in September 2020 in announcing sanctions against the Ukrainian businessman.

The sanctions followed an August 2020 statement by the U.S. intelligence community that the pro-Russian Ukrainian lawmaker was spreading false narratives on behalf of the Kremlin to undermine Biden's candidacy and promote the reelection of then-President Donald Trump.

In December 2019, Derkach met with Rudy Giuliani, who was then Trump's personal lawyer, when Giuliani traveled to Ukraine to dig up allegations of corruption against Biden and his son, Hunter Biden.

In May 2020, Derkach released audio recordings of calls made four years earlier between Biden and Ukraine's then-president, Petro Poroshenko. The leaks helped fuel conspiracy theories about Biden's alleged role in the firing of Ukraine's top prosecutor.

The Treasury Department in early 2021 imposed sanctions against seven individuals and four entities that it said were "part of a Russia-linked foreign influence network associated with" Derkach.

"Since at least 2019, Derkach and his associates have leveraged U.S. media, U.S.-based social media platforms, and influential U.S. persons to spread misleading and unsubstantiated allegations that current and former U.S. officials engaged in corruption, money laundering, and unlawful political influence in Ukraine," the Treasury Department said.

A graduate of a Moscow-based Russian spy academy, Derkach went on to serve as a member of a pro-Russian political party in Ukraine's Parliament.

Michael J. Driscoll of the FBI New York Field Office, assistant director in charge of the FBI's New York field office, noted that the "Kremlin-backed Ukrainian politician and oligarch" was "sanctioned for his efforts to influence the 2020 U.S. Presidential election on behalf of the Russian Intelligence Services."

"While participating in a scripted Russian disinformation campaign seeking to undermine U.S. institutions, Derkach simultaneously conspired to fraudulently benefit from a Western lifestyle for himself and his family in the United States," Driscoll said in a statement.

Derkach, who remains at large, faces charges of conspiracy to violate the International Emergency Economic Powers Act, bank fraud conspiracy, money laundering conspiracy, and four counts of money laundering. If convicted, he faces up to 30 years in prison.

U.S. Attorney Breon Peace for the Eastern District of New York announced Derkach's indictment.

"The conduct of this Kremlin asset, who was sanctioned for trying to poison our democracy, has shown he is ready, willing and capable of exploiting our banking system in order to advance his illicit goals," Peace said in a statement. "The U.S. will not be a safe haven where criminals, oligarchs or sanctioned entities can hide their ill-gotten gains or influence our elections."

In addition to the criminal indictment, federal prosecutors filed a lawsuit seeking forfeiture of Derkach's two condos.

The charges and forfeiture action against Derkach represent the first use of criminal and forfeiture powers targeting the concealment of ownership by senior foreign political officials, passed as part of the National Defense Authorization Act of 2021, the Justice Department said.

"Attempting to enjoy the safety, security and freedoms of an open society, while secretly working to undermine that very society, is a hypocrisy that runs through every sanctions charge announced by the task force," said Andrew Adams, head of Task Force KleptoCapture. "It is a particularly egregious hypocrisy in the case of Andrii Derkach — sanctioned for attempts to undermine American democracy, while corruptly seeking to benefit from its protections."

The interagency task force was launched in March to enforce the sweeping sanctions, export restrictions and economic countermeasures that the United States has imposed in response to Russia's invasion of Ukraine.

Following his designation by the Treasury Department, Derkach sought to evade U.S. sanctions, prosecutors allege.

The day after he was sanctioned, Derkach wrote on Facebook that the "decision was drawn up on a piece of paper by several congressman" [sic] "of [a U.S. political party] and inspired by representatives of the State Department," according to the indictment.

Editor's note: A previous version of this story incorrectly stated that Derkach was charged in an eight-count indictment. The indictment contains seven counts. The story has also been updated with additional edits and new information about Derkach's background and activities during the 2020 U.S. presidential campaign.