FL group bank

https://www.bnnvara.nl/zembla/artikelen/the-dubious-friends-of-donald-trump-the-russians

Although still in its early days, Donald Trump’s presidency is coming under fire. The Russians are alleged to be in possession of sensitive information about Trump. And that exposes Trump to blackmail. Fake news, tweets Trump: “I have nothing to do with Russia – no deals, no loans, no nothing!” Trump swears he has no ties with the Russians. But is that actually the case?

For months, the FBI have been investigating Russian interference in the American presidential elections. ZEMBLA is investigating another explosive dossier concerning Trump’s involvement with the Russians: Trump’s business and personal ties to oligarchs from the former Soviet Union. Powerful billionaires suspected of money laundering and fraud, and of having contacts in Moscow and with the mafia. What do these relationships say about Trump and why does he deny them? How compromising are these dubious business relationships for the 45th president of the United States? And are there connections with the Netherlands? ZEMBLA meets with one of Trump’s controversial cronies and speaks with a former CIA agent, fraud investigators, attorneys, and an American senator among others. Investigations conducted by ZEMBLA show that Bayrock has formed a business construction in the Netherlands, which may have been used to siphon off one and a half million dollars. In this enterprise, Bayrock collaborated with Viktor Khrapunov, a fugitive ex-mayor and governor from Kazakhstan. The Kazakhstan government accuses Khrapunov of systematically looting hundreds of millions of public assetsThis email explains that Trump’s business partner Bayrock Group L.L.C. is behind Bayrock BV, and that the actual owner of Helvetic Capital S.A. is none other than the wife of Viktor Khrapunov.

This mail clearly refers to the use of a Dutch go-between company. Its contents also reveal that the Dutch construction was formed by the law firm of Rudy Giuliani who, at the time, was a partner in Bracewell & Giuliani LLP, and is also a Trump confidante.... Bayrock and Khrapunov agree to deposit 1.48 million dollars in KazBay. On 25 September, Bayrock transfers its share of 740,000 dollars, evidence of which is recorded in theBayrock informs an investor that the 1.48 million was invested in mining operations in Kazakhstan. According to this email the business partner asks to see records of the expenses. Bayrock, however, appears unable to account for the 1.5 million dollars. When ZEMBLA asks about the suspect investments, Bayrock declines to answer“Bayrock B.V. and KazBay B.V. were entities formed with the advice of outside legal counsel as part of the structuring of an investment by Bayrock. The investment was not successful and the structure subsequently was abandoned. We have vociferously denied the baseless allegations made in the Kriss lawsuit. We will not comment on matters that are subject to ongoing litigation.”

In the Kriss vs Bayrock lawsuit a former Bayrock employee accuses the company of perpetrating large-scale tax fraud and of running a criminal organisation.

The Dutch intermediaries were directors of KazBay for eighteen months. During this time, various articles were published, exploring the murky past of Bayrock and Khrapunov.

Six months ago, the Financial Times wrote this article about Khrapunov and his business partner Bayrock, accusing KazBay of operating as a money laundering channel.

Dossier 2: Trump & Felix Sater

Donald Trump appeared entirely unconcerned by the criminal background of his then business partner Felix Sater. In an email to an investor, Saterobserves that Trump’s main consideration was to turn the situation to his own financial advantage. In the email which was earlier disclosed by Forbes Magazine, Sater refers to a meeting that took place on 23 January 2008.

[ct doc]

According to internal documents belonging to Bayrock, the gathering was an important meeting which required the presence of all Trump SoHo business partners. Prior to the meeting, Sater appears to have been in contact with Trump. I

n an e-mail Sater tells his colleagues: “Donald is happy with me”.

At the time of the meeting, Trump is fully aware of Sater’s past. A month earlier, on 17 December 2007, the New York Times published an article on Sater and his criminal deeds. On 19 December 2007, Donald Trump declares his intention to look into the matter.

Frederick Oberlander

Frederick Oberlander is a New York-based attorney specialised in tax law.

He took legal action as far as the United States Supreme Court calling for the public disclosure of the sealed legal dossier of Felix Sater. His attempts have proved largely successful. Previously, a variety of lower courts had ruled that Oberlander was enjoined from in any way revealing secret documents on Sater that he had obtained from a Bayrock employee, and instructed not to refer to the case at all.

'qui tam' case

Oberlander has been conducting legal proceedings against Bayrock for years. He instigated what’s known as a ‘qui tam’ case against the company in 2015. ‘qui tam’ is a specifically American law suit filed by a private individual, acting as prosecutor (a private Attorney General) to recover misappropriate government funds (in this case taxes).

In the case against Bayrock, the public prosecutor of the State of New York has given Oberlander the go-ahead to represent a group of clients who are suing Bayrock ‘on behalf of themselves and the people of the State of New York’.

According to Oberlander, Tevfik Arif, Felix Sater and Julius Schwartz are guilty of perpetrating various types of fraud, and have attempted to conceal their fraudulent activities.

Update: 27-09-2017

On September 27th 2017, a New York State Supreme Court Judge dismissed the Qui Tam lawsuit.

Statement Bayrock Group LLC.:“We are gratified by Justice Charles E. Ramos’s ruling today dismissing in its entirety the Qui Tam lawsuit brought by attorney Fred Oberlander. We argued that Oberlander’s repeated misconduct and violations of New York’s attorneyethics rules required dismissal of the action. We have maintained throughout that the lawsuit was without merit and based on stolen confidential materials.”

Dossier 3: Bayrock’s deal with the FL Group

This presentation divulges that the Icelandic investment company FL Group is one of Bayrock’s strategic partners. In 2007, the two companies sign a million-dollar property development agreement. Donald Trump approves the agreement, and also adds his signature .

[trump sign]

Court documents state that Russian investors, who are supporters of Vladimir Putin, are said to be behind the FL Group. The documents also refer to a covert plan concocted by FL and Bayrock. Together, the companies are purported to have been planning a tax fraud amounting to 250 million dollars. In their above-mentioned response, Bayrock let us know they have no intention of commenting on cases that are subject to ongoing litigation.

The FL Group (now known as Stodir after a restructuring in 2009) informed Zembla as follows:

- " FL Group’s total investment in the Bayrock project(s) was USD 80 million.

- After the restructuring, we had our advisors and lawyers review the project, with the aim to recover value or find out if Stodir had any rightful claims – but without any success and no value was recovered.

- we have no knowledge or information about most of your questions, apart from the ones that relate directly to FL Group.

- We see no evidence about Russian investors in FL Group, at least no Russian entity was ever registered on FL Group’s shareholders list.

- We see no evidence about FL Group investing in Kazakhstan."

Reactions to 'The dubious friends of Donald Trump: the Russians':

Felix Sater denies having threatened people with violence. In spite of repeated requests, Sater has not answered ZEMBLA’s questions. Donald Trump, Alexander Machkevich and Viktor Khrapunov have not responded either.

This is the statement of Bayrock and Tevfik Arif :

“Bayrock B.V. and KazBay B.V. were entities formed with the advice of outside legal counsel as part of the structuring of an investment by Bayrock. The investment was not successful, and the structure subsequently was abandoned. We have vociferously denied the baseless allegations made in the Kriss lawsuit. We will not comment on matters that are subject to ongoing litigation.”

FL Group (which is now called Stodir after going through a restructuring in 2009) lets ZEMBLA’s know:

- "FL Group´s total investment in the Bayrock project(s) was USD 80 million.

- After the restructuring, we had our advisors and lawyers review the project, with the aim to recover value or find out if Stodir had any rightful claims - but without any success and no value was recovered.

- We have no knowledge or information about most of your questions, apart from the ones that relate directly to FL Group.

- We see no evidence about Russian investors in FL Group, at least no Russian entity was ever registered on FL Group´s shareholders list.

Frederick Oberlander

Frederick Oberlander is a New York-based attorney specialised in tax law.

According to Oberlander, TevfikArif, Felix Sater and Julius Schwartz are guilty perpetrating various types of fraud, and have attempted to conceal their fraudulent activities.

https://www.alternet.org/2018/12/the-purchase-of-donald-trump-new-report-details-how-russian-money-poured-in-to-save-trumps-businesses/

President Donald Trump’s celebrity was cemented in the American mind with the show “The Apprentice,” which sold him as a real estate mogul and business genius imparting his wisdom to a new generation of entrepreneurial hopefuls. But the show’s fundamental premise is a lie.

Far from a business genius, Trump was largely a flop in business. As a recent investigative piece in Foreign Policy explained, Trump’s repeated failures in the ’90s made him virtually radioactive to any American banks looking to fund new ventures. Lenders were wary of trusting the most prominent son of actual real estate titan Fred Trump, because Donald Trump’s businesses were consistently going belly up — most famously, the Trump Taj Mahal Casino in Atlantic City.

So how was Trump able to recover his image from its ’90s battering? Trump’s sons have repeatedly offered not-so-subtle clues.

In 2008, for instance, Donald Trump Jr. said at a New York conference: “In terms of high-end product influx into the US, Russians make up a pretty disproportionate cross-section of a lot of our assets.”

And in 2014, Eric Trump reportedly told golf writer James Dodson of the family business: “Well, we don’t rely on American banks. We have all the funding we need out of Russia.” (Eric Trump has since denied saying this.)

Reporters Jonathan O’Connell, David Fahrenthold and Jack Gillum at the Washington Post reported back in May on the Trump Organization‘s curious shift from funding projects almost entirely with debt in the ’90s to employing large bushels of cash by the mid-2000s.

Michael Hirsch, writing for Foreign Policy, found significant corroboration for Trump’s reliance on foreign funds. Multiple anonymous sources, former associates of the president, told Hirsch that Trump especially used Russian funds when American sources ran dry.

Some of this, it seems, came in the form of direct real estate purchases. Despite repeatedly denying any ties to the Kremlin, Trump has even admitted to one major deal with a Russian, Dmitry Rybolovlev, who is believed to be close to Putin. Rybolovlev bought a Palm Beach house from Trump for $100 million — $60 million more than what the president had initially paid for it, according to an ABC interview with Trump. This is a remarkably high profit for any such deal — but it is even more startling because it happened in 2008, when the American real estate market was cratering.

“That deal delivered so much cash to Trump, it almost has to be seen as a campaign contribution, or the purchase of Donald Trump,” Trump biographer Michael D’Antonio told Hirsch.

A former business associate told Hirsch that this was not the only property Trump sold to a Russian national.

“I think part of it was he was toxic to the banks. I think he also probably learned that personal guarantees [on loans] weren’t a brilliant idea either,” the anonymous associate told Hirsch. “So he was saying to himself, ‘What else could I do in the world? I’ll just convince people to buy my brand.’ And the only people who were willing to buy it were tasteless Russians, people who like the absurd, ostentatious gold-leaf lifestyle he has. You’re not going to sell that brand to blue bloods in Greenwich, Connecticut.”

But the Russian connection is also hiding in plain sight. In the early 2000s, Trump started his comeback by partnering with the Bayrock Group, a financial firm run, in part, by Felix Sater. Sater had pleaded to guilty to participating in a fraudulent scheme with the Russian mafia in the ’90s, became an informant to the FBI, and was a key player along with Michael Cohen is brokering a deal to build Trump Tower Moscow in 2016 before the negotiations mysteriously went quiet after Trump secured the GOP presidential nomination.

Hirsch explained:

Bayrock’s money sometimes came from sources outside Russia and the former Soviet republics, according to one of the firm’s former employees, including an obscure Icelandic investment bank called the FL Group. But those roads too sometimes appeared to lead back to Russia. In 2017, real-estate developer Jody Kriss, whom Sater hired to help him run Bayrock,told Timothy O’Brien of Bloomberg what happened after an Icelandic competitor of the FL Group contacted him to invest in Bayrock. When Kriss brought that offer to Sater and Arif, they told him that the money behind Icelandic banks “was mostly Russian”—and they had to take FL’s funds for deals with Trump because FL was “closer to [Vladimir] Putin,” according to O’Brien. (Kriss confirmed this account to FP.) In 2007, the FL Groupinvested $50 million in several Bayrock projects linked to Trump, including a development in Whitestone, Queens, and Trump SoHo in Manhattan. FL Group dissolved in 2014.

Kriss told Bloomberg’sO’Brien that he eventually left Bayrock because he became convinced that the firm was a front for money laundering.

All of these connections are almost certainly being scrutinized by Special Counsel Robert Mueller, federal prosecutors at the Southern District of New York, and any of the other agencies investigating the president’s past.

war is boring

...

Criminal Scheme #3: The Trump/Sater/Bayrock Deals

But a number of deals in the United States between Trump and Bayrock produced a far more interesting—and incriminating—history.

Perhap’s Sater’s most famous partnership with Trump was an infamous deal to develop a SoHo property in Manhattan. The deal was concocted in 2006 by Trump, Sater, and two other partners from former Soviet states: one was Bayrock chairman Tevfik Arif, an ex-Soviet government official from Kazakhstan who’s rise to fortune is at least somewhat questionable; the other was Tamir Sapir from Georgia, who had decades ago established ties to numerous important Soviet officials after immigrating to the U.S., who may have very well been (once) part of—or even come to the U.S. secretly working for—the Soviet Ministry of Internal Affairs (at whose academy he had apparently studied), whose source of his wealth had long been subject to rumor-fueled suspicion, who introduced Trump to Bayrock, and whose former business partner had pled guilty to racketeering conspiracy charges spanning 13 years with the Gambino crime family (incidentally or not, at the time of the SoHo deal, it seems Sapir was not exactly mentally fit).

It turns out that the SoHo deal had a significant portion of its Sater-and-Arif facilitated financing—some $50 million specifically approved by Trumpfor it and three other projects—flow from a firm in Iceland, FL Group,linked to the Panama Papers revelations and one apparently known as a hub for the money of Russians “in favor with Putin.” Financing for these projects was also secured from **Alexander Mashkevich** (or Machkevich), a Kazakhstani billionaire with a history of money laundering.

Considering Sater had helped pave the way for this investment and recalling his Mogilevich connection, it is hardly unreasonable to assume that there is a high probability that some of the money coming in from Russians was in one way or another tied directly or indirectly to the giant Eurasian gas scheme worth billions, as this period was especially a time when Russians tied to Putin and operating through Manafort, Firtash, and Mogilevich were aggressively trying to funnel money away from prying eyes of the likes of Tymoshenko. Besides the Russian financing, some of the transactions involving the property were clearly carried out by shell corporations for the purpose of laundering money, transactions from which Trump profited. Furthermore, the SoHo deal was structured to cheat the U.S. government out of tens of millions in taxes, as the investments were illegally restructured as loans (not incidentally tax-free) to avoid paying hefty taxes on them, loans that would also give FL Group a big chunk of theoretical future profits over time.

In the end, the deal went terribly for Trump, who was sued for fraud—his children Eric and Ivanka had inflated the level of interest in order to attract buyers—and in a 2011 settlement, he refunded 90% of the deposits on the building’s condos.

One must wonder why likely Russian investors were so eager to invest $50 million in this deal, and if it was an excuse to launder money, rather than an actual investment, as was the case with the Park Avenue deal involving Manafort & Co, and that model would seem to be repeated by Bayrock again and again, Repeated in deals with Trump and with Saterserving again as a point-man.

Even as construction on Trump SoHo began in 2007, another of the Trump/Bayrock projects was rising in Fort Lauderdale, Florida; this one, the Trump International Hotel & Tower, would also result in disaster and led to over a dozen lawsuits, with over 100 condo buyers suing for $7.8 million. The project was supposed to have been completed by the end of 2007 but fell way behind schedule; Sater and his Bayrock partners secretly and seemingly cashed out their stakes in this project and several others—including the SoHo deal—in a deal with the aforementioned Icelandic firm, FL Group. Trump eventually pulled his name from the project, and when its buyers learned this in May, 2009, this only increased their outrage and added to lawsuits already in motion accusing Trump and Bayrock of fraud. As in the SoHo deal, confidential settlements, this time with dozens of buyers, ensued, and Trump refused to accept any responsibility, blaming the problems on the economic crises. Florida courts declined to rule that Trump or his partners had committed fraud, including a state appeals court just last year. The project finished years late, cost some $200 million, and was eventually sold for merely $115 million at a foreclosure auction. And while the evidence of money laundering in this case is not as explicit or solid as the information publicly reported on in the SoHo deal, it is still a similarly structured deal with the same partners that led to a similarly dubious result, making it more likely, not less, that similar laundering was taking place.

Another Bayrock partnership with Trump in Fort Lauderdale (not part of the FL Group ventures) was originally conceived of as the Trump International Beach Club; an initial $2 million in capital was provided by Arif in 2003, and from that point, Sater and Arif conned a friend of Arif’s who was also Sater’s landlord, Elizabeth Thieriot, lying about the value of the club, hiding their own investment in the project, and convincing her to provide a $1 million investment for a mere 4% of the Club, 12 times what they had paid for that percentage and allowing them to make a 1,125% profit on her investment; as in the SoHo deal, they illegally labeled the investment a loan to avoid paying taxes on it and were using their fraud to hide skimming $1 million off the top; on top of that, when there was income finally generated in 2005, they defrauded their partner Thieriot of her rightful share; eventually Theiriot figured out some of what was going on and sued her scammers in court in 2006, and they pulled similar scams on other investors/members in the Club. The project was apparently eventually reconceived of as the Trump Las Olas Beach Resort, but was suspended in a declining market by Trump himself in October 2007.

Another deal among the four which received FL Group financing was a failed project that never even got off the ground in Phoenix, Arizona. Trump began eyeing the Camelback area of Phoenix, Arizona, for a luxury residential tower back in late in 2003, a project similar to the others; Trump’s team, and then Trump himself, met with the mayor, who wasn’t impressed with Trump, and at a meeting in January, 2005, when plans were unveiled, local residents showed up to argue against the development, yet by September, the appropriate city bodies had approved the plans. It seems Sater’s people organized intimidation, bribery, and deception as tactics to deter residents from gathering enough signatures to force a public referendum that could have overridden the city bodies’ approval; under this pressure, the city council voted to reverse its decision and pressed the developers and the neighborhood association to reach a compromise, at which point Trump himself abandoned the project, not wanting to be part of anything that would be scaled down any further in scope and ambition. Ernie Mennes, the owner of the Camelback property who had gone into a partnership with the Bayrock/Trump developers, sued Bayrock in 2007 in federal court, accusing Sater of both threatening to “cut off his legs and leave him ‘dead in the trunk of his car’” and of stealing money from the project for himself. The judge oversaw a settlement and the case was sealed, likely because of Sater’s special relationship with the government. This property was part of the $50 million pseudo-offloading to FL group, and by June of 2009, Bayrock was relieved of the property, which it had left $36 million in debt, when it was “sold out from under” the company at a trustee auction for a mere $10 million.

The final in the group of four projects of Bayrock tied to FL’s “investment” involved a Waterpointe property in Queens (apart from approving FL’s money, Trump was otherwise not involved). Bayrock bought the property in 2008 for $25 million, but the soil was contaminated and had to be replaced, which Bayrock did with other soil that was even more contaminated and was fined $150,000 for doing so; when Bayrock defaulted on a loan in 2011, the lender took over Waterpointe and sold it for roughly $11 million, less than half what Bayrock had paid.

As for FL Group, it failed in spectacularly 2008, along with Iceland’s other major banks/funds and many others in the world during the great global financial meltdown.

...