CEO Gets Decade in U.S. Prison for Illegal Exports to Russia

  • Alexander Fishenko denied being ‘some kind of a secret agent’
  • Arc Electronics chief told U.S. judge he ‘loves’ America

A Russian-born chief executive officer who pleaded guilty to procuring millions of dollars of sophisticated microelectronics for Russia, including warfare defense systems used in fighter jets, was sentenced to 10 years in a U.S. prison by a judge who accepted his claims that he’s an immigrant who "loves" America.

A federal judge in Brooklyn, New York, rejected a prosecutor’s request to sentence Arc Electronics Inc. founder Alexander Fishenko to more than 18 years on the basis that his actions led to "a sophisticated effort to assist Russia’s militarization efforts."

While he imposed a lesser term, U.S. District Judge Sterling Johnson cautioned that the full impact of Fishenko’s crimes won’t be known for decades, noting that evidence at a related trial showed that some of the sophisticated components which Fishenko’s firm shipped are frequently used in a range of military weapons.

"Whether intentionally or unintentionally, some of these sophisticated components did end up with the Russian military," Johnson said. "God knows what kind of impact that will have, either for our future or their future. Whether Mr. Fishenko is a spy or not a spy, there’s no evidence he was a spy."

Letter to Judge

Fishenko wrote to the judge before his sentencing, saying he started his company with "honorable" intentions and attributed his downfall to entering "the wrong business at the wrong time." He said he lacked the expertise to deal with the export of sophisticated electronics and asked for a term of four years and two months in prison.

"I fear you don’t know me," Fishenko said in the letter. "I fear that you have this image of me as some kind of a secret agent."

"I love this country!" wrote Fishenko, who didn’t speak in court on Thursday. "The absolute furthest thing from my mind was being a spy for Russia."

By falsely claiming to be a traffic light manufacturer, Arc Electronics duped companies including Texas Instruments Inc., Xilinx Inc. and Toshiba Corp. to sell it sensitive electronic components, some of which were funneled to the Russian military, prosecutors said. Fishenko pleaded guilty in September to charges that included conspiracy, acting as an unregistered agent of the Russian government and illegal export of microelectronics.

"Yes, I committed crimes, but I never, ever did so with the intention of hurting this country," he said. He said he spent the last 3 1/2 years at a federal jail in Brooklyn teaching yoga, art and English to his fellow inmates and received commendations from prison officials for his efforts.

Evading Controls

Fishenko led a conspiracy to obtain advanced, cutting-edge electronics from manufacturers and suppliers in the U.S. to export them to Russia and evade government controls, according to U.S. prosecutors. The items included microprocessors which are frequently used in military systems, missile-guidance systems and detonation triggers.

He also helped the Russian military get a type of radar installed in the nose of a fighter jet, such as a MiG, to aim its weapons system at multiple targets, according to prosecutors. Fishenko used sham entities and offshore bank accounts to hide the transactions, prosecutors said. He shipped about $50 million worth of sophisticated electronics to Russian agencies, they said.

"These are all items that the Russian military were desperate to procure," Brooklyn Assistant U.S. Attorney Una Dean said, because Russia was more than 10 years behind the U.S. in the technology.

The technology companies that were allegedly duped weren’t charged with any crimes.

Three former employees of Arc Electronics were convicted last year after a trial while four others pleaded guilty to being part of the scheme.

The case is U.S. v. Fishenko, 1:12-cr-626, U.S. District Court, Eastern District of New York (Brooklyn).

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