U.S. Announces New Indictment Against International Arms Dealer Viktor Bout and American Co-Conspirator for Money Laundering, Wire Fraud and Conspiracy

NEW YORK, Feb 17 /PRNewswire-USNewswire/ -- Preet Bharara, the U.S. Attorney for the Southern District of New York, and Michele M. Leonhart, the Acting Administrator of the United States Drug Enforcement Administration (DEA), announced today the unsealing of an indictment against international arms dealer Viktor Bout, aka Boris, aka Victor Anatoliyevich Bout, aka Victor But, aka Viktor Budd, aka Viktor Butt, aka Viktor Bulakin, aka Vadim Markovich Aminov, and his associate Richard Ammar Chichakli, aka Robert Cunning, aka Raman Cedorov, for allegedly conspiring to violate the International Emergency Economic Powers Act (IEEPA) stemming from their efforts to purchase two aircraft from companies located in the United States, in violation of economic sanctions which prohibited such financial transactions. The indictment unsealed today also charges Bout and Chichakli with money laundering conspiracy, wire fraud conspiracy and six separate counts of wire fraud, in connection with these financial transactions.

Bout has been in custody in Thailand since March 6, 2008. Since Bout's arrest, the United States has been actively pursuing his extradition from Thailand on a separate set of U.S. charges. Those charges allege that Bout conspired to sell millions of dollars worth of weapons to the Fuerzas Armadas Revolucionarias de Colombia (the FARC) -- a designated foreign terrorist organization based in Colombia -- to be used to kill Americans in Colombia. The United States has apprised Thai authorities of the new charges against Bout unsealed today and will continue to work closely with them on this matter. The United States is also coordinating with INTERPOL to locate and arrest Chichakli.

According to the indictment unsealed today in Manhattan federal court and other court documents:

Bout, an international weapons trafficker since the 1990s, has carried out a massive weapons-trafficking business by assembling a fleet of cargo airplanes capable of transporting weapons and military equipment to various parts of the world, including Africa, South America and the Middle East. The arms that Bout has sold or brokered have fueled conflicts and supported regimes in Afghanistan, Angola, the Democratic Republic of the Congo, Liberia, Rwanda, Sierra Leone and Sudan. Chichakli, an American citizen, has been a close associate of Bout since at least the mid-1990s, assisting in the operations and financial management of Bout's network of aircraft companies.

Since at least 2000, Bout's role in fueling international conflicts with weapons, as well as his close relationship with Chichakli, have been recognized by the international community. Based in part on their close association with former Liberian President Charles Taylor, both Bout and Chichakli have been the subject of United Nations Security Council (UNSC) sanctions restricting their travel and their ability to conduct business around the world.

According to the UNSC Sanctions Committee Concerning Liberia, Bout "supported former President Taylor's regime in [an] effort to destabilize Sierra Leone and gain illicit access to diamonds." The Sanctions Committee also noted that Chichakli, "an employee/associate" of Bout's, had a "significant role in assisting [Bout] in setting up and managing a number of his key firms and moving money." In addition, more than 25 companies affiliated with Bout and Chichakli have been listed by the Sanctions Committee as subject to similar restrictions concerning their assets and financial transactions. As a result of the UNSC's resolutions and sanctions regime, all United Nations member states have been directed to freeze any funds, financial assets and economic resources owned or controlled by Bout and Chichakli, and to ensure that such monies are not made available to them, or used for their benefit, within the member states' territories.

In 2004, consistent with the sanctions previously adopted by the UNSC concerning Liberia, the President of the United States issued an executive order prohibiting any transactions or dealings within the United States by individuals affiliated with former President Taylor. Accordingly, the U.S. Department of Treasury, pursuant to its authority under the IEEPA, prohibited Bout from conducting any business in the United States. In 2005, that prohibition was extended to Chichakli. In 2006, similar to the sanctions relating to Liberia, the President of the United States issued an executive order prohibiting any transactions or dealings within the United States by individuals involved in the destabilization of the Democratic Republic of the Congo. The Treasury Department identified Bout as an individual subject to the Congo prohibitions.

The United Nations and IEEPA sanctions encumbered Bout's and Chichakli's efforts to conduct business within their existing corporate structures. Accordingly, the defendants took steps to form new companies, and to register these companies in the names of other individuals in order to create the false appearance that they had no affiliation with them.

One such company, Samar Airlines, was created in 2004, right after the majority of United Nations and IEEPA sanctions became effective. Bout and Chichakli were personally involved in the operational and business affairs and decisions of Samar Airlines, though they held out other individuals as being the officers of the company. In 2007, in violation of the IEEPA sanctions to which they were subject at the time, Bout and Chichakli, acting through Samar Airlines, contracted to purchase two Boeing aircraft from companies located in the United States.

In connection with the purchase of these aircraft and services relating thereto, Bout and Chichakli electronically transferred more than $1.7 million through banks in New York and into bank accounts located in the United States. They did so through a number of front companies, whose assets were also owned and controlled by Bout, in order to evade the UNSC's sanctions regime and the IEEPA prohibitions. Upon the discovery that Chichakli was connected to Samar Airlines, the U.S. Treasury Department blocked the funds that had been transferred into the bank accounts of the U.S. aviation companies.

The indictment unsealed today charges Bout and Chichakli with nine individual offenses:

Count one: Conspiracy to violate the International Emergency Economic Powers Act;

Count two: Money laundering conspiracy;

Count three: Wire fraud conspiracy; and

Counts four through nine: Wire fraud.

If convicted, Bout and Chichakli face a maximum sentence of 20 years in prison on each of counts one through nine. The case is assigned to U.S. District Judge William H. Pauley III.

The charges unsealed today were the result of the close cooperative efforts of the U.S. Attorney's Office for the Southern District of New York, the DEA, the U.S. Department of Justice Office of International Affairs, and the U.S. Department of State.

"Viktor Bout allegedly made a career of arming bloody conflicts and supporting rogue regimes across multiple continents, even using the U.S. banking system to secretly finance a private fleet of aircraft. The United Nations and the United States have long-standing sanctions against Bout that stem from, among other things, his support of the most violent and destabilizing conflicts in recent African history. Until his arrest in March 2008, Bout had found a way to circumvent these sanctions, successfully evading the rule of law. This office is committed to working with our partners in the United States, at the United Nations, and around the world to bring transnational criminals like Viktor Bout to justice," said U.S. Attorney Preet Bharara.

"Viktor Bout was originally charged in March 2008 with conspiring to kill Americans by selling millions of dollars worth of weapons to Colombia-based narco-terrorists. Further investigation has revealed additional criminal activities by Bout including money laundering and wire fraud conspiracy. The additional charges contained in the newly unsealed superseding indictment amply illustrate the extraordinary breadth of Bout's deadly criminal enterprise," said DEA Acting Administrator Michele M. Leonhart.

This case is being handled by the Office's Terrorism and International Narcotics Unit. Assistant U.S. Attorneys Anjan Sahni, Brendan R. Mcguire, Jenna M. Dabbs and Christian R. Everdell are in charge of the prosecution.

The charges contained in the indictment are merely accusations and the defendants are presumed innocent unless and until proven guilty.

SOURCE U.S. Department of Justice