The shadow of Moscow falls over Brazil: From scandal over the shelter of the Russian spy, to cyber-espionage and the sale of oil

Putin continues to exploit his friendship with Brasilia. Lula's government refuses to extradite Cherkasov, the Russian agent who tried to infiltrate the Hague Court with a false passport, to the US. Meanwhile, fears of cyber-penetration by hackers for the Kremlin grows, writes Maria Zuppello.

Russia's long shadow continues to stretch over Brazil and now spans many sectors, including cyber and real estate. Above all, the next few days are likely to offer a surprise twist on what now has all the makings of a spy story straight out of a John le Carré novel. On Thursday 27th July came the Brazilian government's "no" to the extradition to the United States of Sergei Cherkasov, a John Hopkins graduate and Russian GRU spy with the false Brazilian identity of Viktor Muller Ferreira, who was returned to Brazil by the Dutch authorities before he could start an internship at the International Court at The Hague, Netherlands He has been in prison since April 2022, first in São Paulo and latterly in Brasilia.

The Minister of Justice and Security, Flavio Dino, broke the news. "He will remain in prison in Brazil for now," he wrote in a tweet. The United States had requested his extradition after charging him with espionage, bank fraud and document forgery. Washington State Department sources had suggested that Cherkasov could be used in a prisoner swap with Moscow to bring back Wall Street Journal journalist Evan Gershkovich, detained in Russia in March on charges of espionage. So now what will become of Cherkasov?

Moscow, it should be remembered, requested his extradition alleging, as usual when it comes to repatriating its own operatives, that Cherkasov is a fugitive, a member of a heroin trafficking organization and that his crimes were committed between 2011 and 2013, although Russia had never looked for him before 2022. This is even more strange when considering that, according to Brazilian emigration records, the Russian spy was in the South American giant in both 2010 and 2011.

Very recently, the Brazilian press has raised disturbing scenarios about the possible fate of the spy. On July 24, the Federal Court of the Third Region based in São Paulo reduced his sentence from 15 years to 5 years, 2 months and 15 days in a semi-open regime. That's a twist that, according to the Metropolis news site, could get him out of prison in the next few days.

The fear is that the Russian intelligence services will take advantage of the decision to mount an illegal operation to exfiltrate the spy to Moscow , as is their usual practice in these cases. The technical loophole on which the fate of Cherkasov depend in the coming days is the extradition process underway in Brazil's Federal Supreme Court, where a decision by Judge Edson Fachin guarantees his imprisonment until the end of the trial. Only he, who is the rapporteur of the case, has the power to revoke it and let the spy out of prison.

From his first months in prison, Cherkasov was convinced that he will soon be released. In his post-arrest documents cited in the US trial, written to his girlfriend code named W4, Cherkasov appears to be quite clear on the outcome of his case. "There's no chance I'm staying here," he wrote. "They had to give me a big sentence to save face, okay? No one will sit here serving 15 years for a fake passport." Also according to US trial documents, prior to his arrest Cherkasov communicated with a Russian consular officer in Brazil, known as C2 at trial, who worked "for the Consul General at the Consulate General of the Russian Federation." "C2's communications with Cherkasov," the court documents state, "confirm that C2 knew that Cherkasov was a Russian citizen receiving instructions from the Russian consul."

The communications lasted from July 2016 to the end of December 2019 on various topics, including economic ones, showing that the risk of an exfiltration organized in Brazil by the Russians with the support of Russian diplomacy is now a plausible hypothesis, as happened in Italy recently with Artyom Uss, son of the governor of Krasnoyarsk, in Siberia, who escaped from his house arrest in Milan to avoid being extradited to the United States.

At this delicate stage, the risk of Russian cyber activities targeting Brazil is high, as explained to Infobae* by one of Europe's leading cybersecurity experts, Pierluigi Paganini , CEO of CYBHORUS and member of the Threat Landscape Group of the European Union Cybersecurity Agency (ENISA). "There is a possibility that Nation-State actors working for the Russian government target Brazilian government entities and companies in the South American country for espionage purposes.. Also, one has to keep in mind that Russian criminal actors are financially motivated and therefore willing to attack anyone and anywhere for profit," Paganini said.

Russian cyber activities have long been evident in Brazil, and not just for espionage purposes. Russian hackers have over the years developed unique skills in specific activities such as creating malware, especially banking ransomware and Trojans, hacking and carding services, i.e. buying and selling stolen credit card data.

Paganini explained. "At the same time, the Brazilian cybercriminal community has specialized in developing malware to attack bank customers that use home-banking systems. Over the years, the interaction between both communities has intensified, especially with regard to the commercialization and development of banking Trojans and systems capable of stealing payment cards from PoS and ATM systems. We are talking about long-standing collaborations that have given rise, and will continue to give rise in the future, to very sophisticated threats. Recently, we are observing Brazilian criminal groups that intend to join large ransomware gangs that operate on a global scale such as Lockbit or BlackCat," Paganini told Infobae .

Russia's influence also stretches over Brazil on the oil front. As reported by investigative journalist Leonardo Coutinho, Lula's Brazil imported more Russian oil than all the imports of the same product in the previous twelve years. The flow of Russian oil to Brazil in the first five months of 2023 was 48.7% more than the total amount imported between 2010 and 2022.

In addition, according to Cuban dissident media, in mid-July oil, apparently from Russian sources, was landed for the first time in Cuba by a Vietnamese-flagged ship, El Orión, coming from the port of Paraguaná, in Brazil. This puts Brazil in a problematic diplomatic situation at risk from triangulation of goods sanctioned by the European and US authorities.

Meanwhile, Lula's claim to have his own peace plan to end the Russian invasion of Ukraine seems increasingly unrealizable. Also on Thursday 27th July, Ukrainian President Volodimir Zelensky declared in an interview with Globo TV that he hopes to be invited to Brazil by Lula. The Brazilian Foreign Ministry responded by saying that he is "welcome to Brazil", but without formalizing any invitation.

Undoubtedly, Russian oligarchs are welcome in Brazil while trying to escape European and American sanctions. The luxury real estate market in Rio de Janeiro has, thanks to them, grown by 23.5% in the first half of this year. "They rent high-end properties, large apartments. They are families with small children, who are not involved in the war," some real estate agents from Rio de Janeiro explained to the newspaper O Globo. "These are people who have invested money abroad, who work from home, in situations where geographic function doesn't matter. They don't talk about the war." Among the examples cited is that of a Russian, whose personal details have not been provided, who spent nearly two million dollars on a penthouse.

As Abbas Gallyamov, Putin's former spokesman, recently reported, if the war in Ukraine failed, Vladimir Putin could flee to Latin America. The Telegram channel "Mozhem Obyasnit" claimed that high-ranking Russian Government officials have started buying property and applying for resident status in Venezuela, Ecuador, Paraguay and Argentina. In addition, Russian diplomats have reportedly bought property on Venezuela's Margarita Island to escape detention at home if the war leads to regime change in Russia.

Maria Zuppello is an Italian investigative reporter based in Brazil and is an expert on the crime-terror nexus, especially in South America.

Curated by Robin Ashby, Director General, UK Defence Forum

* INFOBAE is the most widely read Spanish-language news site in the world and first published the original version of this story, which can be found at https://tinyurl.com/yckz6kwz