{"id":18090,"date":"2022-06-17T08:27:52","date_gmt":"2022-06-17T08:27:52","guid":{"rendered":"https:\/\/informnapalm.org\/en\/?p=18090"},"modified":"2022-06-17T08:27:52","modified_gmt":"2022-06-17T08:27:52","slug":"how-companies-from-switzerland-italy-and-germany-help-russia-circumvent-sanctions-to-produce-weapons","status":"publish","type":"post","link":"https:\/\/informnapalm.org\/en\/how-companies-from-switzerland-italy-and-germany-help-russia-circumvent-sanctions-to-produce-weapons\/","title":{"rendered":"How companies from Switzerland, Italy, and Germany help Russia circumvent sanctions to produce weapons"},"content":{"rendered":"

The investigation was prepared by the Economic Security Council of Ukraine<\/a> together with the InformNapalm<\/a> international intelligence community.<\/span><\/i><\/p>\n

Instead of a Foreword<\/b><\/h2>\n

This is Berenne Alinovi<\/a>. She has her own business in Barcelona, Spain. She sews cocktail and wedding dresses and creates jewelry with Swarovski crystals.<\/span><\/p>\n

And this is Inna Soloshenko from Lebedyn<\/a>, Sumy Oblast, in a wedding dress. She married Mykhailo in 2019. In 2020, the woman gave birth to their son Yefrem.<\/span><\/p>\n

Recently, the life of the Soloshenko family was suddenly cut short. <\/span>On March 12, 2022, a Russian tank fired point-blank at the car they were in.<\/b><\/a><\/p>\n

But this might not have happened, in particular, if some foreign companies had not helped the Russian Federation to produce weapons circumventing the sanctions imposed back in 2014.<\/span><\/p>\n

One of these companies, still working for the Russian military-industrial complex, is headed by Berenne\u2019s husband, Roger Alinovi. Despite the sanctions, t<\/span>he Swiss company CODERE <\/b>he manages continued to supply equipment to the sanctioned Elektromashina plant in Russia, which <\/span>produces components for Russian tanks<\/b>.<\/span><\/p>\n

Unfortunately, this company is not alone. <\/span>Dozens of Swiss, Italian, and German firms make deals with Russian defense companies through shell companies and circumvent sanctions. They are doing that to earn billions of dollars while Russian missiles and tanks are killing innocent Ukrainians.<\/b><\/p>\n

Who Supplies the Equipment and to Whom<\/b><\/h2>\n

The Elektromashina plant, which Alinovi cooperates with, is located in Russian Chelyabinsk and is part of the Uralvagonzavod Corporation. The Uralvagonzavod, in its turn, is a daughter company of Rostekh, a giant Russian state conglomerate operating in the civil and military industry.<\/span><\/p>\n

Now Uralvagonzavod <\/span>is the only tank manufacturer<\/b> in the Russian Federation. Elektromashina produces components for these tanks.<\/span><\/p>\n

In 2014, after Russia\u2019s war against Ukraine started, Uralvagonzavod fell under EU sanctions, like many other companies. European companies would have to withdraw from joint projects and break any business ties with these enterprises. However, many companies did not do so.<\/span><\/p>\n

That\u2019s why, back in 2016, Elektromashina bought new equipment \u2013 a thermal treatment line manufactured by the Swiss company CODERE SA. <\/span>It was purchased for RUB 155.5 million through an intermediary, Galika-CTS company.<\/b><\/a><\/p>\n

At first glance, it might seem that the Swiss company might not be aware of the end clients for their equipment because they entered into a contract with another company rather than the Russian defense enterprise.<\/span><\/p>\n

However, this impression is wrong. The Swiss CODERE knew everything. The company announced cooperation with Elektromashina in 2013. It even held a <\/span>conference with representatives of the State Duma of the Russian Federation, the Ministry of Industry and Trade, Oboronprom Holding, the Russian embassy, and the business community of Switzerland.<\/b><\/p>\n

In addition to CODERE, numerous other firms cooperate with the Russian defense industry. One of them is the <\/span>Swiss GF Machining Solutions.<\/b><\/p>\n

In 2018, the JSC <\/span>Konstruktorskoe Buro Priborostroeniya<\/span><\/i> (Instrument Design Bureau) in Tula received equipment worth more than <\/span>RUB 722 million <\/b>from the Swiss company GF Machining Solutions. In particular, the Russian company purchased 23 MIKRON HPM 600HD milling machines, 12 MIKRON HEM 500U milling machines, 1 AgieCharmilles FORM 20 die-sinking machine, and MIKRON HRM 1150U milling machine.<\/span><\/p>\n

This Russian company designs weapons. For instance, the Bureau produced the <\/span>Pantsir surface-to-air missile and gun systems<\/b>, which Russia uses in the war against Ukraine<\/a>. Also, the Bureau develops systems of high-precision weapons of surface-to-surface, surface-to-air, and air-to-surface classes and designs grenade launchers, sniper rifles, machine guns, submachine guns, pistols, and revolvers.<\/span><\/p>\n

In 2017, Izhevsk Mechanical Plant in Udmurtia got an AgieCharmilles CUT 20 P wire-cutting EDM machine from the Swiss GF Machining Solutions for <\/span>EUR 169,648<\/b><\/a>.<\/span><\/p>\n

This equipment also helped strengthen the aggressive Russian army because the Izhmekh plant produces 86% of all small arms in the Russian Federation, including the Makarov and Yarygin pistols. By the way, they were found in the town of Dymer, Vyshgorodsky district, Kyiv Oblast, after the withdrawal of Russian troops. The locals of the village spent 35 days under Russian occupation. People are still scouring the neighboring forests, looking for their missing relatives tortured by the Russian military.<\/span><\/p>\n

Also, in 2018, the largest manufacturer of aircraft engines in the Russian Federation, PJSC ODK-UMPO (Ufa, Bashkortostan), received a universal grinding machine WALTER HELITRONIC MINI POWER for more than <\/span>RUB 81 million from Walter, a German company.<\/b><\/p>\n

By the way, in 2018, ODK-UMPO began developing an <\/span>engine for the SU-57 fighter. <\/b>In May 2022, Russian propagandists boasted of testing the fifth-generation Su-57 fighters in the war against Ukraine.<\/a><\/span><\/p>\n

<\/p>\n

The <\/span>Swiss manufacturer Fritz Studer AG <\/b>also cooperates with Russia. In 2018, the company supplied two universal cylindrical grinding machines, Studer S21 CNC, to the largest aircraft and space engine building enterprise of the Russian Federation PJSC Kuznetsov in Samara. It cost <\/span>more than RUB 316 million.<\/b><\/p>\n

By order of the Ministry of Defense of the Russian Federation, Kuznetsov <\/span>produces engines for the Tu-160 White Swan strategic bombers, deeply modernized Tu-160M, Tu-95MS, and long-range Tu-22M3 aircraft. Now the Russians are actively using all these aircraft in the war in Ukraine.<\/b><\/p>\n

And in 2019, the Swiss manufacturer fulfilled the order of the only company that produces missiles for the C-300 and C-400 anti-aircraft systems – JSC MMZ Avangard (Moscow). Russian troops near Kharkiv used those weapons – the S-400 and S-300 anti-aircraft missile divisions – in April 2022.<\/span><\/p>\n

The Russian client got a precision CNC cylindrical grinding machine with the function of processing external and internal threads S30 worth <\/span>over EUR 382,000 <\/b>from the Swiss company.<\/span><\/p>\n

In 2019, JSC NPP Kaluga Instrument-Making Plant Typhoon got a TNA 400 lathe <\/span>worth EUR 260,000 from Index Traub, a German manufacturer. <\/b>The Russian enterprise produces radar stations for surface ships of the Russian Navy and coastal missile systems<\/a>. The Bal coastal missile system equipped with anti-ship cruise missiles is produced here. <\/span>It is used for shelling Ukraine from Crimea.<\/b><\/p>\n

The Russian JSC \u201cChepetsky Mechanical Plant\u201d (Glazov, Udmurtia) received a Planomat HP 412 CNC profile grinding machine for <\/span>more than RUB 41 million <\/b>from the <\/span>German manufacturer Blohm Jung GmbH <\/b>in the same year.<\/span><\/p>\n

The Chepetsk Mechanical Plant is part of Rosatom, whose <\/span>employees took part in seizing the occupied Zaporizhia Nuclear Power Plant. <\/b>The enterprise also occupies one of the critical positions in the process cycle for producing nuclear fuel based on natural uranium.<\/span><\/p>\n

In the same year, the <\/span>Italian manufacturer Hexagon Metrology S.p.A<\/b>. sold a Micra Hexagon Metrology coordinate measuring machine worth over <\/span>EUR 171,000 <\/b>to the Russian JSC Izhevsk Electromechanical Plant KUPOL. KUPOL supplies the Russian Ministry of Defense with Tor air defense systems<\/a>, which the Russians actively use in the war against Ukraine.<\/span><\/p>\n

In 2018, the <\/span>Swiss manufacturer Sylvac SA <\/b>sold an optical measuring system, the Scan 52 model, worth <\/span>almost RUB 3 million <\/b>to the Russians. The customer is JSC Novosibirsk Ammunition Plant, which produces cartridges for small arms, including caliber 7.62×51.<\/span><\/p>\n

The Tochnost (Precision) sniper rifles, which the Russian National Guard was armed with in 2017, have this caliber. According to Reuters, Vityaz, a special unit of the Russian National Guard, operated in Bucha. So, this Swiss company also contributed to the tragedy.<\/span><\/p>\n

How Companies Circumvent Sanctions<\/b><\/h2>\n

Most of the aforementioned Russian enterprises are under sanctions. In particular, the sanctions lists include the Uralvagonzavod Corporation (which includes Elektromashina), JSC Instrument Design Bureau, Izhevsk Mechanical Plant (part of the Kalashnikov Concern), JSC Izhevsk Electromechanical Plant KUPOL, Ufa Motor-Building Production Association (ODK-UMPO, owned by United Engine-Construction Corporation JSC), Avangard MMZ JSC.<\/span><\/p>\n

Despite this, <\/span>Italian, Swiss and German companies keep cooperating with the Russian defense industry. <\/b>But, of course, they do it through the <\/span>Swiss shell company, Galika AG, <\/b>rather than directly. <\/span>This company\u2019s director is Lino Derungs, a Swiss citizen. <\/b>However, he has been doing business in Russia since the early 1990s.<\/span><\/p>\n

Switzerland allegedly joined the sanctions against defense enterprises of the Russian Federation, which the US and the EU imposed due to the annexation of Crimea.<\/span><\/p>\n

\u201cBut we do not want to be perceived as a country taking sides. Therefore, we usually introduce monitoring to ensure that Russia or Russian companies do not use Switzerland to circumvent EU sanctions. Conversely, we ensure that European companies or other entities do not use Switzerland to circumvent them,\u201d <\/span><\/i>Yves Rossier, the then Swiss Ambassador to the Russian Federation, explained the situation in 2018.<\/span><\/p>\n

That same year, he promoted cooperation with representatives of Galika AG in the Perm Krai.<\/span><\/p>\n

Galika AG sells equipment in the Russian Federation through numerous branches. One of them is Galika CTS. Until 2020, Evgeny Georgievich Polkanov was the director of Galika CTS. In 2014-15, he was the deputy director of Stankoprom Holding, a part of Rostekh. Thus, it becomes clear why the Swiss company cooperates with the Russian defense industry.<\/span><\/p>\n

According to tender data, from 2016 to 2021, Galika CTS signed contracts worth RUB 1.4 billion with Russian clients. However, there may be many more of them because, after the sanctions were imposed in 2014-2015, most orders for defense enterprises of Rostekh were classified as secret.<\/b><\/p>\n

<\/p>\n

The photo depicts the then Swiss Ambassador to the Russian Federation Yves Rossier (left), and the representative of the Swiss Galika company, Rostekh employee Yevgeny Polkanov (right).<\/span><\/i><\/p>\n

You can, of course, assume that European equipment manufacturers did not know to whom they supplied their products. However, they definitely did.<\/span><\/p>\n

For example, the Swiss manufacturer <\/span>GF Machining Solutions <\/b>became a member of the <\/span>Russian-Swiss Competence Center in the field of micromachining technologies <\/b>in June 2014.<\/span><\/p>\n

<\/p>\n

The photo depicts representatives of Stankprom (Rostekh) and GF Machining Solutions cutting the ribbon on the occasion of setting up a joint center on June 18, 2014.<\/span><\/i><\/p>\n

Walter Maschinenbau (Germany), which supplied machine tools worth EUR 2.37 million to the ODK-UMPO enterprise for producing engines for SU-57 fighters, also knew about the final recipient of its products. Here, we offer several arguments to prove this.<\/span><\/p>\n