Russia Sanctions Evasion Case Study: Viktor Labin

When asked to confirm his link to Russian military intelligence, Labin sent the investigative journalist to **redacted** in Russian. 

None of the entities mentioned in this case study appear on any sanctions lists, but the presence of red flags indicating possible evasion of sanctions or trade controls imposed against Russia should result in additional scrutiny. 

Red Flags 

🚩 A Russia-based company, which boasts that it has customers in Russia’s military sector, imports sensitive machines and technologies from Europe.  

🚩 A Belgian shipping company has been sending equipment Russia’s military needs to a Russian company that has military industry clients, even after sanctions were imposed on Russia. 

🚩 The Belgian company has a Russian owner. 

🚩 The Belgian company’s directors are also Russian, are related to the owner, and one of them owns the Russia-based company that is importing European equipment for Russian military industry customers. 

🚩 The owner of the Belgian company is almost certainly a Russian military intelligence officer. 

🚩 Turkey does not have a sanctions regime against Russia and is a high-risk transshipment jurisdiction. 

Some Research Strategies 

Find corroborating evidence. The Insider reached out to Viktor and Roman Labin to corroborate information it received that Sonatek works with the Russian defense sector and that the elder Labin owns Groupe d’Investissement Financier, confirming information the outlet received from other sources. 

Evaluate sources. Credible sources of information include official databases, grey literature, academic research, due diligence research databases, and sanctions and watch lists. Adverse media reports are also useful but require additional insights into historical reporting and ownership to evaluate objectivity and corroboration for the reporting. Public social media activity can provide insights into the activities, background, education, and personal connections of a company’s leaders. 

• The Insider confirmed Labin’s links to the GRU by accessing public information about his previous addresses, one of which was a GRU officer dormitory in Moscow. 

Research involved parties using tools that will help determine where company owners and directors are based, ownership and control of the entities involved, leadership structure, their connections on social media, and additional business ventures in which they may be involved. Research business activities and confirm locations of the entities involved in transactions.  

• The Insider confirmed that Labin is the director of another company in Belgium – Projet Plus – that is located at his residential address, which features his surname both on the doorbell and the mailbox. Additional research shows that Projet Plus is a Private Limited Company whose lines of business include “management consultancy,” “computer consultancy and computer facility management,” and “other IT activities” – a vague description of business activities that should raise a red flag when doing enhanced due diligence. 

Basic list screening should be the first step taken to ensure none of the counterparties involved in a potential transaction are sanctioned or subject to trade restrictions. However, US and international regulators are increasingly focused on enforcement of existing sanctions and export controls, and firms and financial institutions should be cautious about their customers and research trade partners and their clients’ business activities, especially if the client is located in a high-risk jurisdiction such as Russia, or any of the countries that are known transshipment points for restricted technologies, such as Türkiye, Kazakhstan, Kyrgyzstan and other Central Asian countries, and several Caucasus nations. 

Firms and financial institutions must monitor advisories, alerts, and other guidance issued by regulators, which may contain novel evasion methodologies or red flags indicating a client or counterparty may be evading sanctions. Alerts identifying high-risk goods and sectors, advisories helping stakeholders identify sanctions violations, and guidance highlighting common transactional risks and mitigation measures can help companies enhance their compliance efforts.