Russian bought RM310mil of gold from dealer in Changi to launder funds for Ukraine invasion


The gold was sold by Singapore Precious Metals Exchange, which stores it at Le Freeport, a secured logistics hub in Changi North Crescent. - PHOTO: ST FILE

SINGAPORE (The Straits Times/ANN): A Russian man bought more than US$65 million (S$88 million - RM310 million) worth of gold bullion held in Singapore in a money laundering conspiracy meant to fund the Russian military’s invasion of Ukraine.

The gold was sold by the precious metals dealer Singapore Precious Metals Exchange (SGPMX), which stores the bullions at Le Freeport, a secured logistics hub in Changi North Crescent.

SGPMX is a privately run trading and storage company headquartered in Singapore. It allows its clients to trade in actual gold in an online global exchange, much like how shares are traded on the stock exchange.

Clients can physically check on their gold at the facility at any time.

Russian national Feliks Medvedev, 42, was charged in the United States on April 11, 2023, with one count of operating an unlicensed money transmitting business and 39 counts of money laundering.

On Feb 22, he pleaded guilty to the charges. He admitted to running an unlicensed money transmitting business in the US, and moving over US$150 million of illicit funds in more than 1,300 transactions.

Of this, more than US$65 million was used to buy the gold from SGPMX.

SGPMX told The Straits Times that due to privacy laws, it could not provide details on the matter.

“SGPMX adheres to the highest standards of checks and due diligence and is bound to strict confidentiality clauses as dictated by local regulations and Personal Data Protection Act laws,” a spokesman added.

ST understands the Singapore Police Force are aware of the case.

The US Attorney’s Office for the Northern District of Georgia said Medvedev resided in Georgia, US, where he had registered eight companies which were used to illegally transmit the illicit funds.

It said the companies did not incur typical business expenses or maintain employees, adding that a majority of the illicit funds had come from multiple overseas companies before being transferred to other foreign companies.

Two other Russians and a business consulting firm in Moscow were alleged to have conspired with Medvedev in the transfer of these funds and laundering of the illegal proceeds.

Alexey Chubarov, 42, and Lev Solyannikov, 31, are alleged to have informed Medvedev about the incoming fund transfers, and directed him on transfers to make after, including to SGPMX to buy the gold bullion.

The US Attorney’s Office for the Northern District of Georgia said Chubarov and Solyannikov both worked for the KSK Group, and Chubarov was identified as an expert on international structuring.

The two Russians and the company were charged on Feb 13 with conspiracy, operating an unlicensed money transmitting business, and 39 counts of money laundering for their alleged respective roles related to Medvedev’s scheme.

The case is being investigated by the Federal Bureau of Investigation.

Chubarov and KSK Group were added to America’s specially designated nationals list of sanctioned entities on Sept 14, 2023.

US Attorney-General Merrick B. Garland said on Feb 22 that the illicit funds were for fuelling Russia’s invasion of Ukraine.

“The Justice Department is more committed than ever to cutting off the flow of illegal funds that are fuelling Putin’s war and to holding accountable those who continue to enable it,” he said.

“That is why today we are announcing several additional enforcement actions that the Justice Department has taken to bring prosecutions against and seize assets of sanctioned enablers of the Kremlin and Russian military.”

US Deputy Attorney-General Lisa Monaco said the prosecution of Medvedev, Chubarov, Solyannikov and KSK Group is part of the actions taken by Task Force KleptoCapture, a US Department of Justice unit formed in March 2022.

The unit’s goal is to enforce sanctions on Russian oligarchs in response to the Russian invasion of Ukraine.

Ms Monaco said that since its inception, the task force has restrained, seized, and obtained judgments to forfeit nearly US$700 million in assets from Russian enablers and charged more than 70 people for violating international sanctions and export controls levied against Russia.

She said: “Since the onset of Russia’s brutal and unprovoked invasion of Ukraine, the Justice Department has used every tool in our arsenal – including our international partnerships – to target the criminal actors and activity propping up Vladimir Putin, his henchmen, and his illegal war.

“The charges we announce today against oligarchs, facilitators, and money launderers are the next chapter: so long as Russia’s aggression continues, so too will our resolve to hold its enablers accountable. We stand firmly with the people of Ukraine.”

Medvedev is expected to be sentenced on May 7. - The Straits Times/ANN

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