Two Russian-born American citizens are accused of attempting to send almost $500,000 worth of snowmachines from the U.S. to Russia via China, evading U.S. export controls during Russia’s ongoing invasion of Ukraine.
A federal indictment against Anchorage resident Sergey Nefedov, 40, and Mark Shumovich, 35, of Bellevue, Wash. was announced Wednesday by U.S. Attorney for Alaska S. Lane Tucker’s office. All 17 snowmachines involved in the scheme were seized by U.S. authorities.
Word of the case came just hours after the U.S. State Department unveiled sanctions against more than 300 people and entities accused of helping Russia’s war effort, some by sending “dual-use” items like engines and electronics found in civilian goods that can be repurposed to make military weapons. Western components continue to be found in weapons Russia has used to attack Ukraine, including attack helicopters, air-defense systems and cruise missiles.
“Imports from (China) are filling critical gaps in Russia’s defense production cycle to produce weapons, ramp up defense production, and bolster its military-industrial base,” State Department officials said in the sanctions announcement.
Prosecutors said Nefedov and Shumovich were arrested Tuesday in Alaska and Washington, respectively. They face a dozen federal counts including conspiracy, violating export regulations, smuggling goods from the U.S. and international money laundering.
“Violations of export laws carry significant consequences for perpetrators in the U.S. and abroad,” Tucker said in Wednesday’s statement, pledging to work with other federal agencies on the case.
A spokeswoman for Tucker’s office, Reagan Zimmerman, declined to comment further on the case Wednesday.
According to the 38-page indictment, export controls ordered by President Biden shortly after Russia invaded Ukraine in February 2022 bar sending “passenger motor vehicles specifically designed for traveling on snow” to Russia without an export license. Nefedov allegedly owned two companies, Absolut Auto Sales and Alaska Sled Tours, used to circumvent that requirement.
“At no time did Nefedov, Shumovich, Absolut Auto Sales, or Alaska Sled Tours apply for, receive, or possess a license or authorization from the Department of Commerce to export or reexport snow machines to Russia,” prosecutors wrote.
The defendants’ plan allegedly called for sending snowmachines to Hong Kong in China, then on to Russia. Prosecutors said two unnamed criminal conspirators — Russians who worked with companies based in Hong Kong and Russia — helped the men falsely claim that the snowmachines were headed for South Korea.
“Nefedov, Shumovich and (the other conspirators) sought to export snowmachines from the United States to Russia through Hong Kong to conceal that Russia was the ultimate end destination,” prosecutors said.
In a May 2022 email to a freight forwarder, the Russia-based conspirator allegedly noted the cutoff of U.S. snowmachine exports to Russia and suggested a solution.
“If it’s not possible to deliver to Vladivostok, then I suggest delivering the order in Hong Kong in the name of a company registered in Hong Kong and from there this company will send it to Vladivostok,” the conspirator allegedly wrote.
In September 2022, prosecutors said Nefedov placed several orders for Ski-Doo snowmachines both personally and on behalf of Alaska Sled Tours, using funds sent by the Russians’ firms to Absolut Auto Sales. Soon afterward, Shumovich allegedly asked a U.S.-based shipping firm, through which he had sent goods directly to Russia before exports were restricted, for a quote on sending a container of snowmachines to China or Korea.
“The employee of the shipping company refused to ship the snowmachines, explaining to Shumovich that companies that had previously shipped to Russia and now ship to China or Korea are facing delays and closer scrutiny, and that the employee did not believe the container would pass U.S. customs,” prosecutors said.
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Two months later, prosecutors said a U.S. company tried to send $475,000 worth of snowmachines and parts to the Hong Kong-based conspirator’s company to fulfill an Alaska Sled Tours order. U.S. customs officials detained the order before it was shipped, then seized it in April 2023.
According to Wednesday’s statement, Nefedov and Shumovich each face a maximum sentence of 20 years in prison. Prosecutors are also seeking the forfeiture of the seized snowmachines, should the men be convicted.
Read the federal indictment:
Chris Klint is a web producer and breaking news reporter at Alaska Public Media. Reach him at cklint@alaskapublic.org. Read more about Chris here.
