Please E-mail suggested additions, comments and/or corrections to Kent@MoreLaw.Com.
Case Number: 1:23-cr-00073
Judge: Mary Kay Vyskocil
Court: United States District Court for the Southern District of New York (Manhattan County)
Plaintiff's Attorney: United States Attorney’s Office in New York City
Description: New York, New York criminal defense lawyer represented Defendant charged with international money laundering.
Robert Wise of Pelham, New York, pleaded guilty to one count of conspiring to commit international money laundering, which carries a maximum sentence of five years in prison. Wise also agreed to forfeit more than $3.7 million and to be satisfied by a payment of $210,441. Sentencing is scheduled for Nov. 6.
According to the allegations in the information filed in Manhattan federal court today and other public filings:
On April 6, 2018, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated Vekselberg as a Specially Designated National (SDN) in connection with its finding that the actions of the Government of the Russian Federation in Ukraine constituted an unusual and extraordinary threat to the national security and foreign policy of the United States. On or about March 11, 2022, OFAC redesignated Vekselberg as an SDN and blocked Vekselberg’s yacht and private airplane.
Prior to his designation by OFAC, between approximately 2008 and 2017, Vekselberg, through a series of shell companies, acquired six real properties in the United States, specifically, (i) two apartments on Park Avenue in New York, New York, (ii) an estate in Southampton, New York, (iii) two apartments on Fisher Island, Florida, and (iv) a penthouse apartment also on Fisher Island, Florida (collectively, the Properties). As of the date of this information, the Properties were worth approximately $75 million.
Voronchenko, Vekselberg’s longtime associate, retained Wise, an attorney who practiced in New York, New York, to assist in the acquisition of the Properties. Wise also managed the finances of the Properties, including by paying common charges, property taxes, insurance premiums, and other fees associated with the Properties in U.S. dollar transactions from Wise’s interest on lawyer’s trust account (IOLTA account).
In particular, prior to Vekselberg’s designation as an SDN, between approximately February 2009 and March 2018, shell companies owned by Vekselberg sent approximately 90 wire transfers totaling approximately $18.5 million to the IOLTA account. At the direction of Voronchenko and his family member who lived in Russia, Wise used these funds to make various U.S. dollar payments to maintain and service the Properties.
Immediately after Vekselberg’s designation as an SDN, the source of the funds used to maintain and service the Properties changed. The IOLTA Account began to receive wires from a bank account in the Bahamas held in the name of a shell company controlled by Voronchenko, Smile Holding Ltd., and from a Russian bank account held in the name of a Russian national who was related to Voronchenko. Between approximately June 2018 and March 2022, approximately 25 wire transfers totaling approximately $3.8 million were sent to WISE’s IOLTA account. Although the source of the payments changed, the management of the payments remained the same as before: Wise used these funds to make various U.S. dollar payments to maintain and service the Properties, and he did so knowing that he was promoting sanctions violations. Additionally, after Vekselberg was sanctioned in 2018, Voronchenko, Wise, and others tried to sell both the Park Avenue apartment and the Southampton estate. No licenses from OFAC were applied for or issued for these payments or attempted transfers.
An indictment charging co-conspirator Vladimir Voronchenko, aka Vladimir Vorontchenko, who is a fugitive, was unsealed on Feb. 7. A civil forfeiture complaint was filed against the Properties on Feb. 24.
The FBI and Homeland Security Investigations are investigating the case. The Justice Department’s National Security Division and Office of International Affairs, and OFAC provided valuable assistance.
Assistant U.S. Attorneys Jessica Greenwood, Joshua A. Naftalis, and Sheb Swett for the Southern District of New York are prosecuting the case.
The investigation was coordinated through the Justice Department’s Task Force KleptoCapture, an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export controls and economic countermeasures that the United States, along with its foreign allies and partners, has imposed in response to Russia’s unprovoked military invasion of Ukraine. Announced by the Attorney General on March 2, 2022, and under the leadership of the Office of the Deputy Attorney General, the task force will continue to leverage all of the department’s tools and authorities to combat efforts to evade or undermine the collective actions taken by the U.S. government in response to Russian military aggression.
Outcome: Defendant pled guilty.