In 2014, the American Department of Justice charged six individuals with links to the Russian Mafia including an Indian government official for plotting to sell Indian titanium to Boeing.
How Russian Mafia plotted to sell Indian Titanium to Boeing
Six foreign nationals, including a Ukrainian businessman and a government official in India were charged by the US Department of Justice in 2014, with participating in an international racketeering conspiracy involving bribes of state and central government officials in India to allow the mining of titanium minerals, to be ultimately sold to Boeing.
- Dmitry Firtash – Ukrainian oligarch with links to Russian Mafia
- Andras Knopp – Hungarian businessman
- Suren Gevorgyan – Ukrainian
- Gajendra Lal – Indian national and permanent resident of the United States who formerly resided in Winston-Salem, N.C.
- Periyasamy Sunderalingam – aka “Sunder” of Sri Lanka
- K.V.P. Ramachandra Rao – a Member of Parliament in India who was an official of the state government of Andhra Pradesh and a close advisor to the now-deceased chief minister of the State of Andhra Pradesh, Y.S. Rajasekhara Reddy
Beginning in 2006, Russian Mafia conspired to pay at least $18.5 million in bribes to secure licenses to mine minerals in the eastern coastal Indian state of Andhra Pradesh. The mining project was expected to generate more than $500 million annually from the sale of titanium products, including sales to Boeing, headquartered in Chicago.
Dmitry Firtash, aka “Dmytro Firtash”, a Ukrainian national, was arrested March 12, 2014, in Vienna, Austria. Firtash was released from custody on March 21, 2014, after posting 125 million euros (approximately $174 million) bail, and he pledged to remain in Austria until the end of extradition proceedings.
All six conspirators were charged with one count each of racketeering conspiracy and money laundering conspiracy, and two counts of interstate travel in aid of racketeering.
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As detailed in court documents, Firtash controls Group DF, an international conglomerate of companies that was directly and indirectly owned by Group DF Limited, a British Virgin Islands company. Group DF companies include: Ostchem Holding AG, an Austrian company in the business of mining and processing minerals, including titanium; Global Energy Mining and Minerals Limited, a Hungarian company, and Bothli Trade AG, a Swiss company, for which Global Energy Mining and Minerals was the majority shareholder.
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— GreatGameIndia (@GreatGameIndia) October 16, 2019
In April 2006, Bothli Trade and the state government of Andhra Pradesh agreed to set up a joint venture to mine various minerals, including ilmenite, a mineral which may be processed into various titanium-based products such as titanium sponge, a porous form of the mineral that occurs in the processing of titanium ore.
In February 2007, Boeing entered into an agreement with Ostchem Holding, through Bothli Trade, to work toward a further agreement that would allow Bothli Trade the ability to supply 5 million to 12 million pounds of titanium sponge from the Indian project to Boeing on an annual basis. The mining project required licenses and approval of both the Andhra Pradesh state government and the central government of India before the licenses could be issued.
The conspirators used U.S. financial institutions to engage in the international transmission of millions of dollars for the purpose of bribing Indian public officials to obtain approval of the necessary licenses for the project. They financed the project and transferred and concealed bribe payments through Group DF, and used threats and intimidation to advance the interests of the enterprise’s illegal activities.
Firtash was the leader of the enterprise and caused the participation of certain Group DF companies in the project. Firtash met with Indian government officials, including Chief Minister Reddy, to discuss the project and its progress, and authorized payment of at least $18.5 million in bribes to both state and central government officials in India to secure the approval of licenses for the project.
Firtash also directed his subordinates to create documents to make it falsely appear that money transferred for the purpose of paying these bribes was transferred for legitimate commercial purposes, and he appointed various subordinates to oversee efforts to obtain the licenses through bribery.
Knopp supervised the enterprise and, together with Firtash, met with Indian government officials. Knopp also met with Boeing representatives to discuss supplying titanium products from the project. Gevorgyan traveled to Seattle and met with Boeing representatives. Gevorgyan also engaged in other activities, including signing false documents, monitoring bribe payments and coordinating transfers of money to be used for bribes. Lal, also known as “Gaj,” engaged in similar activities, reported to Firtash and Knopp on the status of obtaining licenses, and recommended whether, and in what manner, to pay certain bribes to government officials.
Sunderalingam met with Rao to determine the total amount of bribes and advised others on the results of the meeting, and he identified various foreign bank accounts held in the names of nominees outside India that could be used to funnel bribes to Rao. Rao solicited bribes for himself and others in return for approving licenses for the project, and he warned others concerning the threat of a possible law enforcement investigation of the project.
In May 2019 the IAF intercepted an #AN32 aircraft flying in from #Karachi. All of North India’s missile defense systems were activated and it was force landed in Jaipur. What was the CARGO of this mysterious aircraft? Why was this entire issue buried?https://t.co/ngdB8ZmUvg
— GreatGameIndia (@GreatGameIndia) October 10, 2019
Court documents lists 57 transfers of funds between various entities, some controlled by Group DF, in various amounts totaling more than $10.59 million beginning April 28, 2006, through July 13, 2010.
The indictment seeks forfeiture from Firtash of his interests in Group DF Limited and its assets, including 14 companies registered in Austria and 18 companies registered in the British Virgin Islands, as well as 127 other companies registered in Cyprus, Germany, Hungary, the Netherlands, Seychelles, Switzerland, the United Kingdom and one unknown jurisdiction and all funds in 41 bank accounts in several of those same countries. Furthermore, the indictment seeks forfeiture from all six conspirators of more than $10.59 million.
Dmitry Firtash and the Russian Mafia
Documents show, bankers close to Russian President Vladimir Putin granted Firtash credit lines of up to $11 billion. That credit helped Firtash, who backed pro-Russian Viktor Yanukovich’s successful 2010 bid to become Ukraine’s president, to buy a dominant position in the country’s chemical and fertiliser industry and expand his influence.
According to a State Department cable posted by WikiLeaks, Firtash told U.S. Ambassador William Taylor that he got his start in business with the permission of one of Russia’s most well-known organized crime bosses, Semion Mogilevich.
“He noted that it was impossible to approach a government official for any reason without also meeting with an organized crime member at the same time. Firtash
acknowledged that he needed, and received, permission from Mogilievich when he established various businesses”.
Firtash later told an American official, there were dinners with mobsters -Mogilevich and Sergei Mikhailov from the Solntsevo Bratva, among others at which he did not know “if he would be beaten up or even killed.”
Firtash’s most important link to Mogilevich came through a Cyprus-based company he joined in 2001 called High Rock Holdings LLC. High Rock’s financial director, Igor Fisherman, had served as a high-level aide to Pavlo Lazarenko, the former Ukrainian prime minister, but was better known as Mogilevich’s right hand, and had also been a principal at YBM Magnex in Newtown, Pennsylvania, as part of Mogilevich’s pump-and-dump stock scam.
As a result of such connections, the US Department of Justice has identified Firtash as an “upper-echelon associate of Russian organized crime.” According to the US ambassador to Ukraine’s cable, “34 percent of High Rock was owned by a firm called Agatheas Trading Ltd,” which Galina Telesh, Mogilevich’s ex-wife,
reportedly directed from 2001 to 2003. Thanks to all of this, a reporter from the Financial Times concluded, Firtash had become “the new face of the Mogilevich group.’
Dmitry Firtash is currently also at the center of an investigation charging him for giving close allies of President Trump documents and information that would help them discredit Trump’s opponents.
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