Russia has built a complex supply chain that allows it to evade sanctions and acquire technology for the weapons it uses in Ukraine.
News agency Reuters (you will switch to another service)the Russian investigative journalism website iStories and British defense think tank (you will switch to another service) (RUSI) found out how Russia acquires the necessary components for the Orlan-10 aircraft, even though the export of microelectronics to Russia is prohibited.
It turned out that Russia is evading sanctions and procuring weapon parts to different parts of the world with the help of a distributed supply chain.
The subcontractors are united by close relations with the Kremlin and Russian businessmen working in the management of the companies.
The tracks lead to St. Petersburg
According to the researchers, it is likely that several Russian companies cooperate with the development and research center located in St. Petersburg.
Special Technology Center Limited Liability Company (STC) announces on their website (you will switch to another service) to develop innovations for the benefit of Russia’s security. One of the focuses of the company’s development is the development of technology used in drones.
Among other things, STC is suspected of developing the Oraln-10 drone model, which Russia has used in attacks on various parts of Ukraine.
According to US authorities, the company works in close cooperation with the Russian intelligence agency GRU.
War and Sanctions (you switch to another service) – according to the database, STC and its CEO Roman Agafonnikov has been placed on the US sanctions list.
STC is also mentioned by the US Treasury Department in the decision (you switch to another service) sanctions from 2016. According to the document, the company helped the GRU intercept signals for intelligence.
According to think tank RUSI, STC is suspected of meddling with Russian intelligence in the 2016 US presidential election.
Without Western microchips, Orlan-10 would be just a shell
RUSI’s previous investigations have revealed that the drones and many precision weapons used by the Russians in Ukraine are built almost exclusively from Western components.
According to the researchers, trade documents, customs information, court documents, declarations of Russian companies and open source data show that the STC company acquired ready-made parts for the airplanes from the Russian company SMT-iLogic.
SMT-iLogic (you switch to another service) is a company specializing in product development of electronic devices such as microprocessors. Its head office is also located in St. Petersburg.
According to iStories, STC senior (you move to another service) Alexey Terentev is one of the founders of the SMT-iLogic company.
News agency Reuters asked STC CEO Agafonnikov about STC’s connections with SMT-iLogic company.
Agafonnikov denied the cooperation and said he knows nothing about the SMT-iLogic company.
Who sold components to SMT-iLogic?
In January-October of this year, SMT-iLogic acquired foreign microchips for around 25 million euros.
By tracking customs records, investigators determined that the company sourced its components through companies operating in the United States, Europe, China, South Korea and Hong Kong.
By far, SMT-iLogic made the most purchases from a company called Asia Pacific Link, whose head office is located in HongKong.
Asia Pacific Links has supplied components to SMT-iLogic since 2017. The company is managed by a Russian businessman living in Toronto, Canada Alexander Trofimov.
In total, SMT-iLogic has purchased components from the Hong Kong company for around 12 million euros. Most of the purchases have been made after February.
SMT-iLogic also made purchases from other Hong Kong companies such as EMC Sud Limited, Sertal LLC and Serniya Engineerig.
The United States is currently investigating the companies’ connections to Russia. Already in August RUSI doubted (you switch to another service)that Russia may have recruited foreign companies as intermediaries in order to gain access to Western technology.
Recently, the United States brought charges against the management of Hong Kong companies. At least 16 people are suspected of evading sanctions and conspiring with the Russian security service FSB, you will find out about the court documents (you will switch to another service).
One of the accused is an FSB officer Vadim Konochenok, who was arrested at the beginning of December in Estonia. The United States is demanding his extradition.
Two Russian businessmen living permanently in the United States are also on the list of accused.
Another partner in the US
Russia has used a similar supply chain in the United States. According to the sales documents, the American Ik Tech company sold 90 percent of its products to St. Petersburg.
Ik Tech was managed by an American citizen until the beginning of the year Igor Kazdan, also known as Alex Stanton. The US authorities arrested him two weeks before the start of the war of aggression for smuggling military supplies to Russia.
Každan told the court in March that the Russian leadership persuaded him in 2016 to circumvent the sanctions and deliver components to Russia.
In the years 2018–2021, Ik Tech supplied Russian companies with components for around two million euros. Among the components were 1,400 processor modules that Ik Tech had purchased directly from the American motherboard manufacturer Gumstix.
American Gumstix has promised to investigate how its motherboards ended up in Russia.
In the past, for example, the semiconductor manufacturer Infineon and the technology company Intel have also started their own investigations into the ending up of components in Russia.