Vilnius-based company’s equipment falls into Russian snipers’ hands – LRT Investigation

Yukon Advanced Optics Worldwide, a Belarusian-owned group that has been operating in Lithuania for almost two decades, condemned Russia’s aggression in Ukraine and said it was shutting down its factory in Russia’s Smolensk. However, data obtained by the LRT Investigation Team and its partners from Scanner Project show that the company has not left Russia yet, while its equipment is falling into the hands of Russian soldiers.

“With the funds you sent us, volunteers from the Vozmezdie (Retribution) frontline supply squad have bought two Pulsar Digisight Ultra N450 LRF night vision scopes for our glorious snipers, who are killing the Nazis on the Donetsk front,” say messages spreading on Telegram and other platforms in Russia.

Vozmezdie is one of the many charitable foundations that have opened in Russia since the start of the war. They collect donations to supply the Russian troops fighting in Ukraine. The Pulsar night vision scopes mentioned by its representatives are a trademark of the Vilnius-based high-tech group Yukon Advanced Optics Worldwide.

Yukon Group has been operating in Lithuania since 2005. From Vilnius, it also manages various companies abroad. In Belarus, the group operates the Beltex Optic plant, and in Russia, the Mezon-A plant. A Belarusian national Aliaksandr Alsheuski was the founder and head of the group. He died suddenly in April this year and the group is now represented by an interim director appointed by the board.

Yukon Advanced Optics Worldwide is known for its advanced thermal imaging devices and digital optics, used by hunters, fishermen, etc. The company stresses that it develops and manufactures products exclusively for the civilian market and has never worked with the military industry.

After Russia launched a full-scale invasion of Ukraine in February last year, Yukon Advanced Optics Worldwide immediately condemned the aggression and pledged its support for Ukraine. At the same time, the group announced that it was suspending its activities in Russia.

“In the face of Russia’s unlawful aggression and in support of the Ukrainian people, the company has stopped supplying its products to Russia and Belarus. A decision has also been taken to suspend the plant in Smolensk (Russian Federation),” reads the group’s statement issued at the end of February 2022.

The same message was reiterated in the group’s written reply to the LRT Investigation Team. It pointed out that the liquidation of its subsidiary Mezon-A in Smolensk is currently underway, almost one and a half years after the promise to withdraw from Russia.

The company has also underlined its help to Ukraine and the Ukrainian people. According to the State Tax Inspectorate, the Yukon Group donated more than 1.4 million euros in 2022. Almost 1 million euros went to public institutions involved in the education of Ukrainian children in Lithuania. It also contributed 50,000 euros to the Radarom! campaign which crowdfunded radars for Ukraine.

However, data gathered by the LRT Investigation Team and the Scanner Project show that while it is donating to Ukraine, the Yukon Group continues to generate revenue in Russia. Yukon products sold under the Pulsar brand are still available in Russian online shops. There is also evidence that the company’s equipment is used by the Russian invaders of Ukraine.

Hunting devices used by Russian soldiers

“Greetings from Donbas! On behalf of the soldiers of the Donetsk People’s Republic militia reconnaissance detachment, I would like to express deep gratitude for the scope that was sent to us by the volunteers of Vozmezdie,” the Russian soldier said on Telegram last November. Equipment bearing the Pulsar logo is displayed next to him.

The Vozmezdie foundation states that it aims to support the Russian army and “fights Nazism in virtual space and in the special operation zone”. This is just one of many such supposedly voluntary organisations. Since Russia’s invasion of Ukraine, they have been raising funds to buy equipment for the aggressor’s troops.

The Narodnaya Druchina (People’s Society) charitable foundation in Khabarovsk also said it handed over four Pulsar Helion 2 XQ50F thermal imaging cameras to Russian troops last year.

The data collected shows that Pulsar equipment is reaching Russian artillerymen, reconnaissance, and aviation. “The second coolest thermal imaging device, the Pulsar Helion 2 XP50 Pro, has been handed over to our wing-brothers [Russian army pilots],” another fundraiser called Fighterbomber announced last May.

Yukon Advanced Optics Worldwide claims that it has no information about the transfer of its products to Russian soldiers. According to the company, it does not operate in sanctioned countries or in areas of military conflict.

“Therefore, we are not aware of any mass use of our products by the Russian army, except in isolated cases which are beyond our control,” reads the reply from Germanas Kavalskis, the company’s chief communications officer.

Tracing distributors

Earlier this year, it emerged that Pulsar equipment was also making its way to the Russian soldiers in Ukraine with the help of the officials. On February 1, the Russian state news agency TASS reported that Sergey Menyaylo, head of the Republic of North Ossetia, had handed over 50 thermal imaging cameras and 20 night vision devices to Russian troops fighting in Ukraine.

The Belarusian opposition news website Zerkalo has established that among these items were Pulsar night vision scopes. Vilnius-based Yukon Advanced Optics Worldwide said at the time that it would investigate how its products fell into the hands of the aggressor’s troops.

Asked about the investigation, Yukon’s CCO said that when the company receives information about its products being used in military operations, it always tries to trace their distributor.

“The presence of our products in areas of military conflict is completely unacceptable to us. It must also be understood that our products have been on the market for many years. Therefore, the goods may have been purchased long ago, resold by third parties, or smuggled from other countries where they are legally traded,” Kavalskis’ reply reads.

According to him, some sellers may also try to take advantage of the well-known Pulsar brand name without the company’s permission.

Secondary market?

Although Yukon Group announced in February last year that it was suspending the operations of its Russian subsidiary Mezon-A, data gathered by the LRT Investigation Team and Scanner Project show that last year, it was supplied with products by Beltex Optic in Belarus, another factory of the group. The sole shareholder of both companies is Yukon Advanced Optics Worldwide.

When asked about this, Yukon’s CCO Kavalskis said that these were “low-value components”. “The contract contained a 180-day payment deferral clause, which resulted in the last payment being made after February 24,” he said in his reply.

However, the available information indicates that the Russian-based company made at least five transfers to Beltex Optic in Belarus after the outbreak of the war. The total value of these transactions was 1 million euros. The last payment was made well after the outbreak of the war, on November 14, 2022.

Beltex Optic also manufactured the Digisight Ultra LRF model of night vision scope handed over to the Russian troops by the North Ossetian leader. At least three official Yukon dealers sold this model in Russia. Night vision scopes are dual-purpose items that can be used for both civilian and military purposes. Such equipment requires a special export licence.

According to Yukon, its equipment handed over to the Russians in early February was manufactured in Belarus before 2020, and the model was discontinued in 2021. “Therefore, we do not rule out the possibility that it was purchased on the secondary market. Given that Belarus and Russia share the same economic zone, the device could have been transferred to another country,” Yukon’s reply reads.

But the LRT Investigation Team and its partners have found out that night vision scopes of this model are still available on the Russian market. The journalists posing as buyers contacted suppliers who claimed to be official distributors of Pulsar and Yukon in Russia. Several said they did not have the specific model at the time, but DV Optic offered to purchase the Digisight Ultra LRF scope and sent photos of the model on sale.

Kavalskis did not deny that information about the availability of the company’s products appears on Russian websites but said that such sellers are acting without authorisation.

“We understand that Russia currently does not have a legal framework for trademark protection and consumer rights because the parallel imports were legalised. Therefore, we cannot guarantee that our products, which have been imported through parallel imports, are being sold in this country as opposed to counterfeits made in Asian countries that are freely available on the market and are not products of Yukon”, he said.

Long withdrawal from Russia

Although Yukon promised to close its plant in Russia at the end of February 2022, the group’s response makes it clear that the decision to “fully withdraw” from the aggressor country was only taken in the summer of last year. According to the company, the process was also complicated by a Russian presidential decree of September 8, 2022, which restricted the transfer of the company’s legal management and required the approval of the Russian State Commission.

According to Kavalskis, the company understands “the public’s expectation to withdraw here and now”.

“However, hanging a lock on the door under these conditions does not mean the legal withdrawal or liquidation of the company. This is a long-term legal process, without which the company’s records will not be removed from the Russian legal registers, which makes it look as if Mezon-A is still a legally existing company, despite the fact that it does not carry out any activities,” Yukon’s CCO said in a written reply.

“It is important for us to be clear to ourselves that we do not produce in Russia, and we do not sell any of our products in Russia and/or Belarus, which means that Russia does not receive any benefit, direct or indirect, from our activities,” he added.

In Kavolis’ words, a decision to initiate the liquidation process of Mezon-A was taken last autumn: “The company is no longer staffed, except for a few administrative personnel who are necessary to ensure the orderly closure and liquidation of the company.”

The Russian commercial registers for the previous year, made public this May, show that Mezon-A employed 45 people in 2022, 12 less than in 2021.

Mezon-A’s revenues in Russia grew the most in 2015-2016, after Russia’s illegal annexation of Crimea, as well as in 2021 when it reached 1.32 billion rubles (around 14.6 million euros at current exchange rates).

Mezon-A also continued to generate revenues in Russia last year, even though the drop in volumes is evident. According to data from the Russian Federal Tax Service, made public in May this year, Mezon-A’s revenues fell by 78 percent in 2022, with a net loss of 2.9 million euros.

Since the start of the war, Mezon-A has sold at least 2.3 million euros worth of goods to Russian customers, according to the company’s banking transactions for 2022-2023, obtained by the LRT Investigation Team and Scanner Project.

Yukon Advanced Optics Worldwide claims that since February 24, 2022, no production or sales of its optical devices are taking place in Russia, and no new orders are being accepted or placed.

“The last orders were placed before the start of the war, some of them were fulfilled by 24 February 2022, while some of the budget segment day vision binoculars manufactured exclusively in China and sold in various outlets were delivered after February 24,” Kavalskis said.

But according to the available data, Mezon-A has received 13 payments from one of its main customers - CEK Group - since the beginning of the war. The payments were not only for binoculars but also for optical equipment and repairs. Transactions between Mezon-A and CEK since the start of the war amount to 1.15 million euros.

The CEK Group is owned by Russian businessman Kirill Yemelyanenko. It is one of the largest suppliers of thermal imaging cameras, night vision scopes, and optical devices in Russia.

Other customers of Mezon-A include Rika, Navigator, Bars, Shturman, Nabliudatelnye pribory, and DV Optik, sellers of optical equipment in Russia. Another company that had paid for Mezon-A’s optical equipment during the war was Moscow-based Sheldi. In mid-May last year, it announced a major addition to its range of Yukon binoculars.

Loan to Belarusian company

After the start of Russia’s war in Ukraine, Mezon-A’s money earned in Russia was transferred to Belarus as loans.

According to the Russian Federal Tax Service, Mezon-A’s revenues in Russia in 2022 amounted to around 3.4 million euros. Meanwhile, on October 12 last year, Mezon-A granted a loan of around 1.7 million euros to Beltex Optic in Belarus. This amount was transferred on November 14 last year.

Another loan, also of around 1.7 million euros, was granted by Mezon-A to the Belarusian company on February 13 this year. As such, since the beginning of the war, Mezon-A has granted approximately 3.4 million euros in loans to Beltex Optic.

“These funds were transferred to a Belarusian company to avoid leaving financial assets in the Russian Federation,” Kavalskis said.

Despite the tense situation, the Belarusian company was profitable last year. According to available data, Beltex Optic’s revenue in 2022 amounted to around 34 million euros, and its profit to around 2.4 million euros.

The company’s exit from Belarus is made difficult by the country’s restrictions on the transfer of shares by foreign-owned companies, introduced last year.

In process

After the Lithuanian version of this investigation was published on LRT on Monday, Yukon Advanced Optics Worldwide issued a statement saying that the company is in the process of winding up its operations in Russia and it is no longer manufacturing or selling its products in Russia and Belarus.

“Mezon-A had booked new transactions with Russian customers for 165,000 euros since the beginning of the war in 2022, and there were no sales at all in 2023,” the company said in its statement.

The company has no production staff and has only nine administrative staff, it said, adding that they are necessary to ensure its liquidation process.

Alexander Yarashevich of the Belarusian Investigative Center also contributed to this investigation.