/>iThe case against Leonid Teyf, a Russian citizen, in a federal court in North Carolina has enough juicy facts for an international crime novel. The U.S. prosecutors need evidence to convict Teyf and his accomplices of the central charges, stemming from an alleged kickback scheme in Russia. Will Russia provide missing links?
U.S. v. Teyf, et al.
In December 2018, a federal grand jury in Raleigh returned a superseding indictment charging Teyf and four other Russian citizens with numerous federal crimes, including money laundering, bribery, immigration fraud, and a murder-for-hire plot. Teyf moved to the United States in 2010 and is a U.S. permanent legal resident.
Among other things, he is charged with
- unlawful use of visas procured through false claims,
- paying US$10,000 to an employee of the U.S. Department of Homeland Security to have his wife’s purported lover deported from the U.S.,
- planning that man’s murder for hire, and
- possessing a firearm with an obliterated serial number.
The U.S. government alleges Teyf initially planned for the murder to take place in the U.S. or in Russia after the purported lover was deported. When the deportation was taking longer than expected, Teyf allegedly paid an FBI confidential source US$25,000 “to kill the man before the end of 2018.” Teyf is being detained awaiting trial despite his argument that he poses no danger to the community because the alleged violence was directed at “the purported paramour of his former wife,” not the larger Raleigh community.
Money Laundering
Teyf and his accomplices also are charged with 29 money laundering counts, stemming from a kickback scheme in Russia. The superseding indictment alleges that, between 2010 and 2012, Teyf was the Deputy Director of Voentorg, a contractor with Russia’s Ministry of Defense. Under the contract, Voentorg provided goods and services to the Russian military (e.g., laundry, food, and equipment). According to the U.S. prosecutors, Teyf and others conspired to have subcontractors pay them a percentage of the government funds.
“These kickbacks of government funds were paid in cash and amounted to more than $150,000,000 over an approximate two-year span.” Some of the money was placed in Teyf’s accounts within Russia. Some money was transferred to the U.S. via accounts in Belize, the British Virgin Islands, Hong Kong, Panama, and Seychelles. Altogether, Teyf and others allegedly received “at least 294 wires for an approximate total of $39,500,000” into four bank accounts. The superseding indictment alleges the wires are proceeds of “unlawful activity, that is, illegal kickbacks of funds belonging to the government of Russia.”
Kickbacks Under Russia’s Laws
The superseding indictment does not cite any Russian laws. Yet the U.S. government may be correct to allege that the kickback scheme constitutes “unlawful activity” in Russia. Three relevant procurement statutes may apply: Federal Law 44-FZ(government contracts), Federal Law 223-FZ (procurement by legal entities); and Federal Law 275-FZ (Ministry of Defense contracts). Russia also has a comprehensive federal statute on combatting corruption—Federal Law 273-FZ, and countering money laundering—Federal Law 115-FZ. Further, Russia’s administrativeand criminal codes establish criminal and administrative liability for money laundering, kickbacks, bribery, including commercial bribery. The underlying kickback scheme, as alleged in the indictment, may violate some or all of these laws.
Will Russia’s Authorities Provide Assistance?
Russia’s assistance seems necessary for successful prosecution of Teyf on the money laundering counts. No court filings explain how prosecutors intend to prove that the USD$39.5 million resulted from a kickback scheme in Russia. However, both Russia and the U.S. are members of the Financial Action Task Force on Money Laundering (FATF) and Interpol. There is also a Treaty for Mutual Legal Assistance between Russia and the U.S. Whether the two countries are using or will use these or other mechanisms in the Teyf case remains to be seen.
