Charges Against Virginia Company Showcase U.S. Government’s Focus on Enforcing Sanctions and Export Controls

19 November 2024
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Key Takeaways:
  • The United States Department of Justice (“DOJ”) charged Eleview International Inc. (“Eleview”), a Virginia-based e-commerce company, and two of its executives with violating export control restrictions imposed on Russia in a scheme that involved transshipping goods through third countries.
  • DOJ’s action against Eleview and its executives is emblematic of a larger enforcement trend, wherein the U.S. government has focused its prosecutorial efforts on “corporate national security,” including on companies and executives involved in the shipment of advanced and sensitive technologies to nation-state adversaries through third countries to evade expanding sanctions and export control restrictions. In early 2023, DOJ and the Department of Commerce (“DOC”) launched the Disruptive Technology Strike Force for that purpose and have been bringing these types of cases across the country.
  • Companies should carefully evaluate their sanctions and export control risks and compliance programs to identify, remediate, escalate internally, and potentially report any activity that may be prohibited by sanctions and export control laws.

DOJ’s Charges Against Eleview International Inc.

On November 4, 2024, DOJ charged Eleview International Inc. and two of its senior executives with conspiracy to violate export control restrictions imposed on Russia following its invasion of Ukraine. DOC and DOJ’s interagency Disruptive Technology Strike Force and DOJ’s Task Force KleptoCapture investigated the case. The Disruptive Technology Strike Force, which operates under the leadership of DOJ’s National Security Division (“NSD”) and DOC’s Bureau of Industry and Security, aims to “target illicit actors, protect supply chains, and prevent critical technology from being acquired by authoritarian regimes and hostile nation states.” Task Force KleptoCapture has a complementary mission: it is dedicated to enforcing sanctions, export restrictions, and economic countermeasures that the United States has imposed on Russia and was stood up in March 2022. Together, these units are now regularly bringing enforcement actions in support of the NSD’s new “corporate national security” mission.

The government alleges that Eleview transshipped over $6 million worth of goods and equipment through Turkey, Finland, and Kazakhstan in an effort to disguise the end recipient, which was in Russia, in violation of U.S.-imposed sanctions and export control laws.

According to the government, the company operated an e-commerce website, which allowed Russian customers to order goods and technology from U.S. retailers. Prior to February 24, 2022, the company would ship the ordered products directly to its Russian customers from its warehouse in Chantilly, Virginia. After Russia invaded Ukraine, DOC imposed strict export controls against Russia. These measures severely restricted Russian customers’ access to sensitive technologies that could be used to bolster the Russian defense sector, including access to semiconductors, telecommunication equipment, encryption security, lasers, and navigation systems. Following these increased restrictions, Eleview allegedly continued to export products to Russia using three schemes meant to conceal the true destination of the goods. The government alleges that, instead of directly shipping the products, Eleview listed intermediary freight forwarders as the “ultimate consignee” of the goods. Under Eleview’s direction, those intermediary shippers then forwarded the goods to their actual destinations in Russia.

In the first scheme, Eleview allegedly transshipped nearly $1.5 million worth of telecommunications equipment from the United States through Turkey. The equipment was then forwarded to a major Russian telecommunications company that was known to equip the Russian government, including Russia’s Federal Security Service. In the second scheme, Eleview allegedly transshipped over $3.4 million worth of goods, including Tier 1 High Priority protected items, through Finland, which were forwarded to customers in Russia. In the third scheme, the company allegedly transshipped nearly $1.4 million worth of consumer goods, electronics, and telecommunications equipment, including thousands of dollars’ worth of goods that were known to have military applications, through Kazakhstan, which were forwarded to customers in Russia.

DOJ Takes Center Stage in Export Control Prosecutions

The charges against Eleview signal that DOJ’s NSD is focused on holding corporate actors accountable for violating U.S. export controls and sanctions laws. NSD is now taking on a much larger and more active role in directly investigating and prosecuting export control violations. Last year, Deputy Assistant General (“DAG”) Lisa Monaco announced that DOJ would increase investigations and prosecutions involving corporate crime and national security and that it would hire the first-ever Chief Counsel for Corporate Enforcement and 25 new NSD prosecutors. Further, in February 2023, DOC and DOJ formed the inter-agency Disruptive Technology Strike Force, another sign of the government’s focus on enforcing export control laws and protecting critical technologies from being acquired or used by nation-state adversaries.

Recent speeches by senior DOC and DOJ officials confirm this approach. In a March 2024 speech, DAG Monaco discussed DOJ’s plans to create a new whistleblower rewards program that would provide incentives for whistleblowers to report corporate crime to DOJ. At the same conference, Assistant Attorney General for National Security (“AAG”) Matthew Olsen announced that “finding and prosecuting corporate and individual wrongdoers is a core responsibility” of NSD and discussed its revamped voluntary disclosure policies. These policies provide that, absent aggravating factors, NSD will not seek a guilty plea where a company has voluntarily self-disclosed, cooperated, and remediated the misconduct. AAG Olsen mentioned that several companies had already taken advantage of these new policies.

Last year, the Assistant Secretary for Export Enforcement at DOC, Matthew Axelrod, announced new policies and initiatives to incentivize corporate compliance with export control rules, including that a company’s deliberate non-disclosure of a significant possible violation of export regulations would be considered an aggravating factor under penalty guidelines and that future cooperation credit could be awarded to competitors that disclose another company’s violations. In March, Assistant Secretary Axelrod relayed that, since last year, DOC had received a significant increase in investigative leads based on tips from industry.

And indeed, the government has increased its enforcement of corporate crime relating to the nation’s security interests. For example:

  • On October 16, 2024, Raytheon Company—a subsidiary of the Arlington, Virginia-based aerospace and defense company RTX—entered into a corporate resolution with the U.S. Attorney’s Office for the Eastern District of New York and NSD for violating export controls, including Part 130 of the International Traffic in Arms Regulations (“ITAR”).
  • On November 1, 2024, prosecutors from the U.S. Attorney’s Office for the Northern District of Florida and NSD secured a conviction against a Middle East-based salesman of a multinational heavy machinery manufacturer with a U.S.-based subsidiary in Northern Florida for conspiring to violate sanctions by transshipping controlled goods through Iraq to Iran.
  • On November 7, 2024, an individual pleaded guilty for his role in a transnational, multimillion dollar scheme to illegally export dual-use semiconductors and other sensitive technology to the Joint Stock Company Research and Development Center ELVEES and other sanctioned entities in Russia. Prosecutors from the U.S. Attorney’s Office for the Eastern District of New York, in conjunction with the Disruptive Technology Strike Force and Task Force KleptoCapture, handled the case.

The government has also recently issued guidance to financial institutions about how they can ensure their compliance with export regulations, underscoring their responsibility to report suspicious activity related to potential export violations in the wake of Russia’s further invasion of Ukraine and the enhanced national security efforts to restrict China’s military modernization. In October 2024, DOC’s Bureau of Industry and Security provided financial institutions with best practice recommendations to reduce the risk of inadvertent export control violations, recommending they:

  • incorporate export control-related due diligence into risk management and compliance processes, before onboarding new customers and on an ongoing basis;
  • review transactions on an ongoing basis to detect and investigate red flags; and
  • conduct real-time screening against certain restricted-party lists.

U.S. export control compliance has “traditionally been of greatest concern to exporters.” The government, however, has since made clear that exporters are not the only parties that must act diligently to detect and report potential export control evasion attempts. Banks are on notice that their risk-based compliance programs should be updated to identify high-risk customers and report related suspicious transactions to the government.

By announcing corporate crime as a priority enforcement area, increasing its resources to go after corporate actors, incentivizing voluntary and whistleblower disclosures, and providing guidance to financial institutions on best practices to ensure export control compliance, the government is strongly signaling that it will continue to bring actions against companies in the export controls and sanctions space. Indeed, this trend is expected to continue under new DOJ leadership, likely with a shift in focus to the shipment of sensitive technologies to China. Considering this newfound attention, companies, particularly those with international subsidiaries, should evaluate their sanctions and export control risks and compliance programs to identify, remediate, escalate, and potentially report activity that may be prohibited by sanctions and export control laws.


This publication is for general information purposes only. It is not intended to provide, nor is it to be used as, a substitute for legal advice. In some jurisdictions it may be considered attorney advertising.