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Secret Tech Deals for Russian Military Projects

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For years, the Russian military has had to rely on imports of the special sensor. However, the inability of the country to produce the sensors locally became a national security threat after Russia’s annexation of Crimea in 2014 and related sanctions.

In 2012, Deputy Prime Minister Dmitry Rogozin who is in charge of supervising the government’s Military Industrial Commission said that Russia would stop relying on imported thermal imaging sensors. Speaking on the Russia 24 TV channel, Rogozin promised that in a years’ time, Russia will be able to produce sensors for its Russian thermal imagers. 

In September 2013, a wholenew firm called simply Fotoelektronnye Pribory (Photo-electronicDevices) was located and registered in a town near Moscow known as Shchyolkovo. The company was situated in a building that belonged to a state scientific research institute known as Tsyklon (“Cyclone”). The institute is among the few enterprises in Russia that manufactures thermal imagerseven though with imported sensors.

Cyclone received a 50% stake in the new company for allowing the right to use the property which was valued at $11.6M USD. The rest of the 50% was given to an offshore firm known as Rayfast Investments. Rayfast was a property of Bluebell Investments Trading whose beneficiary was the private financier backing up Photoelectronic Devices, Konstantin Nikolayev.

Rayfast Investmentswas then split up and half of it was given to another offshore company in Panama called Baron Commercial. It is here that reporters found leaked email that showed that Baron was owned by two young men Alexander Tarasov and Alexey Beseda who were linkedto senior officials. 

The email brought to light the apportionment and the financing of Photoelectronic Devices by the state in 2013. It also sheds light to the third party in the exchange–the private investor of the new firm and a representative of Konstantin Nikolayev. The investors who only put a small fraction of the needed capital were set to profit from the operations of Photoelectronic Devices. Most of the funds, at least 85% was supposed to be state funds. 

Alexey Beseda is the son of FSB general Sergey Beseda who was alleged to overseethe Donetsk People’s Republic on behalf of Russia’s secret services. In 2013, Russian daily newspaper reported that Alexey who was 26years old had acquired 2 luxury homes and 4.3 hectares of land in Moscow. 

Another young man who was involved in the project is also a relative of a high ranking official, Dmitry Rogozin. Dmitry, who made the announcement of Russia manufacturing its own thermal imaging sensors, has often mentioned Roman Rogozin as his nephew in his Twitter account. Roman was a member of the board of directors of Photoelectronic Devices. The email also showed a draft of a letter that Dmitry sent to the director of VneshEkonomBank requesting a loan from the Photoelectronic Devices bank. When asked whether he was transacting on behalf of his nephew, Dmitry refused to comment and even denied that he had a nephew. 

Both Beseda and Tarasov had a growing interest in the company, and this could be seen through a set of financial transactions. Nikolayev’s Bluebell Investments Trading had sold Rayfast Investments to Baron Commercial (tied to Tarasov and Beseda) for an amount of $10,000. He then bought back around half of it for almost 570 times more. 

It was however not the first time that Nikolayezv was partnering up with relatives of both deputy Prime Minister Rogozin and general Beseda. In 2010, Nikolayev became co-owner of Promtechnologii which is a rifle company based in Moscow. Since its establishment, Alexey Rogozin has been the deputy general director. He was however forced to leave the company when his father was appointed deputy Prime Minister and supervisor of Russia’s military industrial commission. He was then replaced by Rogozin’s nephew Roman Rogozin.

As Promtechnologii expanded, it acquired a share in two ammunition factories in Ulyanovsk and Tula in 2012. FSB general second son, Alexander Beseda became a board member. These factories have sold ammunition of about two billion rubles to military agencies and law enforcement groups over the last five years. 

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