The Justice Department is putting associates of Russian oligarchs on notice.
In the latest case of its kind, U.S. prosecutors have charged an associate of Russian billionaire Viktor Vekselberg with sanctions violation and money laundering in connection with helping to maintain Vekselberg’s U.S. properties, according to a five-count indictment unsealed on Tuesday.
Vladimir Voronchenko, a Russian citizen and U.S. permanent resident who fled to Russia last May, is accused of facilitating more than $4 million in payments for the maintenance of four properties owned by Vekselberg.
The properties — an apartment on New York’s Park Avenue, an estate in the seaside community of Southampton, New York, an apartment and a penthouse apartment on Fisher Island, Florida — are worth about $75 million, according to the indictment. Voronchenko is accused of unsuccessfully trying to sell the New York and Southampton properties in violation of sanctions imposed on Vekselberg in 2018.
This is the third indictment of a Vekselberg associate in recent weeks. Last month, the Justice Department charged two businessmen — one British and one Russian — in separate indictments in connection with the operation of a $90 million, 255-foot luxury yacht owned by Vekselberg. The yacht had been seized by Spanish authorities at the request of the United States.
The Justice Department’s Task Force Kleptocapture, created in March 2022 following the Russian invasion of Ukraine, has been leading the fight against corrupt Russian oligarchs. The task force has recently focused on targeting the oligarchs’ enablers.
“Shell companies, straw men, and professional money launderers did not shield Voronchenko or the illicit transactions charged today from the investigative persistence of [Homeland Security investigations], FBI, and the attorneys of the Southern District of New York,” Andrew Adams, director of the task force, said in a statement.
“Today’s indictment is yet another reminder of the priority that the Department of Justice places on uncovering the proceeds of kleptocracy and sanctions evasion and on prosecuting those who would take a paycheck in exchange for facilitating money laundering and sanctions evasion.”
Voronchenko, 70, who lived in three of Vekselberg’s U.S. properties, held himself out as a successful businessman, art collector and art dealer, and as a close friend and business associate of Vekselberg, according to the indictment.
He is charged with two counts related to sanctions violation, and two counts related to money laundering and one count of contempt of court for fleeing the United States seven days after being served with a subpoena to produce documents and appear before a grand jury, according to the Justice Department.
Vekselberg, whose fortune is estimated by Forbes magazine at more than $5 billion, was first sanctioned by the U.S. Treasury Department in 2018 for operating in Russia’s energy sector and again last March following Russia’s invasion of Ukraine.
He bought the four U.S. properties between 2008 and 2017, using a string of shell companies to mask his ownership from public view, according to court documents.
A New York lawyer retained by Voronchenko helped purchase the properties on behalf of Vekselberg and later managed their finances using his “interest on lawyer’s trust account,” or IOLTA, to receive payments from shell companies.
The American Bar Association describes IOLTA as “a method of raising money for charitable purposes, primarily the provision of civil legal services to indigent persons.”
Vekselberg’s purchase of the U.S. properties was hidden behind multiple corporate veils.
Take his 2017 purchase of the Fisher Island penthouse.
The $31.2 million purchase was made by Voxi Management Corp., a Bahamian company owned by Medallion Inc., a Panamanian-registered company.
According to the indictment, Medallion was owned by another Panamanian company, identified as Company 1, which, in turn, was owned by a Panamanian foundation, identified as Foundation 1.
“The first and exclusive beneficiary of Foundation 1 was a British Virgin Islands company (“Company 2”), of which Vekselberg was the sole owner,” the document says.
As of the date of the indictment, Vekselberg remained the ultimate “beneficial owner” of Voxi and Medallion, which in turn owned the U.S. properties.
The indictment includes a notice of U.S. intent to forfeit Vekselberg’s U.S. properties.