Category Archives: corruption

Major U.S. investigation of Russian money laundering through NYC real estate gets shut down abruptly

CNN reports: A major US investigation into Russian money laundering has come to an abrupt end.

The case aimed to expose how Russian mobsters allegedly stole $230 million and hid some of the cash in New York City real estate. Also sure to come up was the suspicious death of the Russian lawyer who exposed the alleged fraud, though US prosecutors weren’t alleging that the defendants were behind it.

The trial was set to start on Monday, but late Friday night, federal prosecutors in New York announced they settled the case with Prevezon, the company accused of buying up “high-end commercial space and luxury apartments” with laundered money.

The abrupt conclusion has some involved in the trial wondering why this Russian investigation had been cut short.

“What most concerns me is: Has there been any political pressure applied in this?” asked Louise Shelley, an illicit finance expert who was set to testify in support of the US government on Tuesday. [Continue reading…]

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Where are the Republicans who are willing to stand up for justice?

Nicholas Kristof writes: When George Washington was preparing to take office, everybody wondered what to call him. Senators proposed lofty titles like “Illustrious Highness” and “Sacred Majesty.”

But Washington expressed irritation at such fawning, so today we are led by a modest “Mr. President.” Later, Washington surrendered office after two terms, underscoring that institutions prevail over personalities and that, in the words of the biographer Ron Chernow, “the president was merely the servant of the people.”

That primacy of our country’s institutions over even the greatest of leaders has been a decisive thread in American history, and it’s one reason President Trump is so unnerving. His firing of James Comey can be seen as simply one element of a systematic campaign to undermine the rule of law and democratic norms.

The paradox is that Trump purports to be (like Richard Nixon) a law-and-order president. His administration has ordered a harsh crackdown on drug offenders, when we should be scaling up addiction treatment instead. Trump is focusing on chimerical fraud by noncitizen voters, even as he impinges on an investigation into what could be a monumental electoral fraud by Vladimir Putin. He favors tough law and order for the little guy.

Comey took the investigation into possible collusion between the Kremlin and the Trump campaign seriously enough that for his last three weeks leading the F.B.I. he was getting daily updates, according to The Wall Street Journal. The new acting director of the F.B.I. confirms that the inquiry is “highly significant.”

For months, as I’ve reported on the multiple investigations into Trump-Russia connections, I’ve heard that the F.B.I. investigation is by far the most important one, incomparably ahead of the congressional inquiries. I then usually asked: So will Trump fire Comey? And the response would be: Hard to imagine. The uproar would be staggering. Even Republicans would never stand for that.

Alas, my contacts underestimated the myopic partisanship of too many Republicans. Senator Charles Grassley, an Iowa Republican, spoke for many of his colleagues when he scoffed at the furor by saying, “Suck it up and move on.” [Continue reading…]

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Don’t forget those smiling images of Trump and the Russians

Anne Applebaum writes: I know that investigations should continue, but let’s be clear: Russia would have needed no inducements or collusion to support Trump’s election campaign. His personality is the kind they understand, his cynicism and his dishonesty are familiar, his greed is the same as their greed. Above all, his lack of respect for the law is their lack of respect for the law. Trump fired the FBI director to get him off his television screen; Russian police lock up dissidents to get them out of public view. No, it’s not the same thing. But it’s not that different either. [Continue reading…]

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EPA dismisses scientists from major scientific review board

The New York Times reports: The Environmental Protection Agency has dismissed at least five members of a major scientific review board, the latest signal of what critics call a campaign by the Trump administration to shrink the agency’s regulatory reach by reducing the role of academic research.

A spokesman for the E.P.A. administrator, Scott Pruitt, said he would consider replacing the academic scientists with representatives from industries whose pollution the agency is supposed to regulate, as part of the wide net it plans to cast. “The administrator believes we should have people on this board who understand the impact of regulations on the regulated community,” said the spokesman, J. P. Freire.

The dismissals on Friday came about six weeks after the House passed a bill aimed at changing the composition of another E.P.A. scientific review board to include more representation from the corporate world.

President Trump has directed Mr. Pruitt to radically remake the E.P.A., pushing for deep cuts in its budget — including a 40 percent reduction for its main scientific branch — and instructing him to roll back major Obama-era regulations on climate change and clean water protection. In recent weeks, the agency has removed some scientific data on climate change from its websites, and Mr. Pruitt has publicly questioned the established science of human-caused climate change. [Continue reading…]

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In a Beijing ballroom, Kushner family pushes $500,000 ‘investor visa’ to wealthy Chinese

The Washington Post reports: The Kushner family came to the United States as refugees, worked hard and made it big — and if you invest in Kushner properties, so can you.

That was the message delivered Saturday by White House senior adviser Jared Kushner’s sister, Nicole Kushner Meyer, to a ballroom full of wealthy Chinese investors in Beijing.

Over several hours of slide shows and presentations, representatives from the Kushner family business urged Chinese citizens gathered at the Ritz-Carlton hotel to consider investing hundreds of thousands of dollars in a New Jersey luxury apartment complex that would help them secure what’s known as an investor visa.

The potential investors were advised to invest sooner rather than later in case visa rules change under the Trump administration. “Invest early, and you will invest under the old rules,” one speaker said.

The tagline on a brochure for the event: “Invest $500,000 and immigrate to the United States.”

And the highlight of the afternoon was Meyer, a principal for the company, who was introduced in promotional materials as Jared’s sister. [Continue reading…]

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Top ethics officer challenges Trump over secret waivers for ex-lobbyists

The New York Times reports: The federal government’s top ethics officer is challenging the Trump administration’s issuance of secret waivers that allow former lobbyists to handle matters they recently worked on, setting up a confrontation between the ethics office and President Trump.

The move by Walter M. Shaub Jr., the director of the Office of Government Ethics, is the latest sign of rising tension between Mr. Shaub and the Trump White House. Mr. Shaub has tried several times to use his limited powers to force Mr. Trump to broadly honor federal ethics rules as well as the ethics order that Mr. Trump himself signed in late January.

Historically, the Office of Government Ethics — a tiny operation that has just 71 employees but that supervises an ethics program covering 2.7 million civilian executive branch workers — has maintained a low profile. Created in 1978 after the Watergate scandal, it does not have subpoena power or its own investigators. [Continue reading…]

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America’s decline from democracy to kleptocracy

Anne Applebaum writes: Daughters have long been used cynically to “humanize” thuggish men. The president’s strategically meaningless but politically useful bombing raid on Syria was justified on the grounds that Ivanka Trump had seen pictures of dying children and prevailed upon his softened heart, as in a fairy tale, to do something. Sarah Kendzior has laid out the remarkable similarities between Trump and Gulnara Karimova, the Uzbek dictator’s daughter, a “cosmopolitan socialite who married into a powerful business family” before making her mark as a fashion designer.” Like Trump, Karimova also masks “brutal practices under the pretext of a soft ‘feminism’ ” and styles herself an ideal modern woman.

But the real problem with Trump is not what she and her husband, Jared Kushner, contribute to the president’s “image,” but what their presence says about the culture of this White House. One of the things that distinguishes rule-of-law democracies from personalized dictatorships is their reliance on procedures, not individual whims, and on officials — experienced people, subject to public scrutiny and ethics laws — not the unsackable relatives of the leader. That distinction is now fading.

No ordinary public official would be allowed to dine with the leader of China, as Trump did, on the same day that China granted valuable trademarks to her company. No civil servant would be able to profit from the jewelry she advertises by wearing on public occasions. Only in kleptocracies are sons-in-law with broad international business interests allowed to make foreign policy. [Continue reading…]

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Top Pentagon watchdog launches investigation into foreign payments Michael Flynn received

The Washington Post reports: The Pentagon’s top watchdog has launched an investigation into money that former national security adviser and retired Army Lt. Gen. Michael Flynn received from foreign groups and whether he failed to obtain proper approval to do so, lawmakers and defense officials said Thursday.

The Pentagon has in the past advised retiring officers that because they can be recalled to military service, they are subject to the Constitution’s rarely enforced emoluments clause, which prohibits top officials from receiving payments or favors from foreign governments.

On Thursday, Rep. Elijah E. Cummings (Md.), the top Democrat on the Oversight Committee, released an Oct. 8, 2014, letter in which a Defense Department lawyer warned Flynn upon his retirement from military service that he was forbidden from receiving payments from foreign sources without receiving permission from the U.S. government first.

Flynn received $45,000 to appear in 2015 with Russian President Vladimir Putin at a gala dinner for RT, a Kremlin-controlled media organization. He also worked as a foreign agent representing Turkish interests for a Netherlands-based company, Inovo BV, which paid his company $530,000 in the fall. [Continue reading…]

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State Department, U.S. embassies promoted Trump’s Mar-a-Lago

Politico reports: President Donald Trump isn’t the only one promoting his private Mar-a-Lago club as the “winter White House.” His foreign policy team has gotten in on it too.

The State Department and at least two U.S. embassies — the United Kingdom and Albania — earlier this month circulated a 400-word blog post detailing the long history of the president’s South Florida club, which has been open to dues-paying members since the mid-1990s and is now used by Trump for frequent weekend getaways. He has hosted foreign leaders there twice.

The blog post — written by the State Department-managed site Share America — described the “dream deferred” when Mar-a-Lago’s original builder, Marjorie Merriweather Post, willed the property to the federal government upon her death in 1973, with the stipulation it be used as a winter retreat for the president.

“Her plan didn’t work, however,” the post’s author, Leigh Hartman, wrote, explaining how the government returned the property to Post’s trust because it cost too much money to maintain. Trump bought the property and its furniture in 1985, and he opened it a decade later as a private club.

“Post’s dream of a winter White House came true with Trump’s election in 2016,” Hartman wrote.

Share America removed the post on Monday after the State Department’s efforts to share the article — originally published just before Trump hosted Chinese President Xi Jinping at Mar-a-Lago — drew criticism. “The intention of the article was to inform the public about where the President has been hosting world leaders. We regret any misperception and have removed the post,” read a statement on the site in place of the post. [Continue reading…]

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Trump condos worth $250 million pose potential conflict

USA Today reports: President Trump’s companies own more than 400 condo units and home lots whose sale could steer millions of dollars to Trump, a USA TODAY investigation has found.

USA TODAY spent four months cataloging every property Trump’s companies own across the country. Reporters found that Trump’s companies are sitting on at least $250 million of individual properties in the USA alone. Property records show Trump’s trust and his companies own at least 422 luxury condos and penthouses from New York City to Las Vegas, 12 mansion lots on bluffs overlooking his golf course on the Pacific Ocean and dozens more smaller pieces of real estate. The properties range in value from about $200,000 to $35 million each.

Unlike developments where Trump licenses his name to a separate developer for a flat fee, profits from selling individual properties directly owned by his companies ultimately enrich him personally. [Continue reading…]

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Trump’s billionaire adviser stands to gain from policies he helped shape

Politico reports: Billionaire investor Steve Schwarzman’s newfound status as a trusted outside adviser for President Donald Trump has created blurred lines in which the Blackstone CEO is offering guidance on policies that could boost the fortunes of his company and his personal wealth.

The starkest example was Trump’s reversal last week on labeling China a currency manipulator — a central campaign pledge that could have dealt a major blow to U.S.-China relations. While many factors likely played into Trump’s decision, including the president’s desire to encourage China to get tough on North Korea, it also followed extensive advice Schwarzman had given the president on the topic, warning Trump against such a move.

Even if Schwarzman was acting in the capacity of an economic expert, those policy changes directly help Schwarzman’s bottom line as CEO of Blackstone, the private equity giant.

And Blackstone has gone so far as to warn its investors about the stakes of Trump’s China policy. In a recent regulatory filing, Blackstone explicitly warned its investors that Trump’s tough talk on China threatened to hurt Blackstone’s portfolio. [Continue reading…]

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Trump administration brags about how many wealthy people it has

The Washington Post reports: Starting Friday evening, the White House will begin to release financial disclosure forms filed by about 180 members of the Trump administration who are either commissioned officers or paid more than $161,755.

Already, the administration is bragging that its members are way wealthier than those who worked for former president Barack Obama — a point of pride that doesn’t quite match the president’s campaign pledge to “drain the swamp” of wealthy GOP donors, lifelong political operatives and those who are simply out-of-touch with everyday Americans. [Continue reading…]

The New York Times reports: Ivanka Trump and Jared Kushner, President Trump’s daughter and son-in-law, will remain the beneficiaries of a sprawling real estate and investment business still worth as much as $740 million, despite their new government responsibilities, according to ethics filings released by the White House Friday night.

Ms. Trump will also maintain a stake in the Trump International Hotel in Washington, D.C. The hotel, just down the street from the White House, has drawn protests from ethics experts who worry that foreign governments or special interests could stay there in order to curry favor with the administration.

It is unclear how Ms. Trump would earn income from that stake. Mr. Kushner’s financial disclosures said that Ms. Trump earned between $1 million and $5 million from the hotel between January 2016 and March 2017, and put the value of her stake at between $5 million and $25 million. [Continue reading…]

The Washington Post reports: Stephen K. Bannon was running an investment banking company in Beverly Hills when his partner called with urgent news: a potential $10 billion deal was about to unfold in New York City involving a company they hoped to continue representing — and they didn’t want to be left out of the action.

Bannon, then in his mid-40s, told his business partner to meet him at the Los Angeles airport in an hour. Soon, they appeared at the Manhattan offices of PolyGram, a worldwide music company that they had previously represented in a film deal and now was for sale.

Before long, Bannon came up with an angle. He had represented Saudi Prince Alwaleed bin Talal, in a prior deal, and now he proffered the royal-family member, one of the world’s wealthiest Arabs, as a bidder. PolyGram was impressed and eventually paid Bannon a sizable fee for work on the overall deal. [Continue reading…]

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Obama WH ethics lawyer: Ivanka’s job is nepotism

The Hill reports: Former White House ethics lawyer to President Obama Norman Eisen said Wednesday that he and the former ethics lawyer to President George W. Bush see Ivanka Trump’s role as an adviser to President Trump as a violation of nepotism laws.

“My view… is that the nepotism statue does apply to the White House,” Eisen said on CNN’s “Anderson Cooper 360” of the announcement that Ivanka Trump would receive an official role in the Trump administration. “For decades the Justice Department held ‘yes’ the nepotism statue applies to the White House.”

Eisen conceded that the “reasonable minds can disagree” on whether the statue should apply.

“President Trump got an opinion from the Justice Department that the nepotism statute doesn’t apply to his White House,” Eisen continued. “We don’t agree with that opinion.”[Continue reading…]

Aside from the issue of nepotism, and aside from the fact that daddy Trump must feel the need for family loyalists close at hand inside a White House filled with potential back-stabbers, it seems to me that Ivanka’s primary function is to serve as a media distraction. Tweets alone cannot fully serve that need.

After all, nothing can preoccupy Trump more than his need to continuously manufacture distractions as threats loom from so many directions. Hence Ivanka’s usefulness when her mere presence in the view of cameras can reliably create a story — at least in the short term.

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Deutsche Bank, mirror trades, and more Russian threads

Ed Caesar writes: March 10th, Congresswoman Maxine Waters, the ranking Democratic member on the House Committee on Financial Services, wrote a letter with four other Democrats to Congressman Jeb Hensarling, the Republican chairman of that committee, the contents of which would have been considered extraordinary in a less chaotic and febrile political atmosphere. The letter began:

Consistent with your past practice of monitoring the Department of Justice’s (“the Department”) investigations, we write to request that the Committee conduct a formal assessment of the Department’s investigation into Deutsche Bank’s Russian money-laundering scheme, including a review of the new Attorney General’s role in continuing the investigation. We also urge the Committee to initiate its own investigation, using the full range of the Committee’s oversight authorities, to determine the nature of the Russian money-laundering scheme, including who participated in the arrangement and whether violations of U.S. Law, beyond the failure to maintain appropriate anti-money laundering controls, may have occurred.

The letter then outlined the anxieties shared by Congresswoman Waters and her Democratic colleagues on the committee. They included a concern “about the integrity of this criminal probe . . . given the President’s ongoing conflicts of interest with Deutsche Bank”—Trump businesses owe hundreds of millions of dollars to Deutsche Bank—and that “suspicious ties between President Trump’s inner circle and the Russian government . . . raise concerns that the Department may fail to implicate those who benefited from Deutsche Bank’s trading scheme.” [Continue reading…]

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Manafort-linked accounts in Cyprus raised red flag

NBC News reports: A bank in Cyprus investigated accounts associated with President Donald Trump’s former campaign chairman, Paul Manafort, for possible money-laundering, two banking sources with direct knowledge of his businesses here told NBC News.

Manafort — whose ties to a Russian oligarch close to President Vladimir Putin are under scrutiny — was associated with at least 15 bank accounts and 10 companies on Cyprus, dating back to 2007, the sources said. At least one of those companies was used to receive millions of dollars from a billionaire Putin ally, according to court documents.

Banking sources said some transactions on Manafort-associated accounts raised sufficient concern to trigger an internal investigation at a Cypriot bank into potential money laundering activities. After questions were raised, Manafort closed the accounts, the banking sources said. [Continue reading…]

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Trump’s business network reached alleged Russian mobsters

USA Today reports: To expand his real estate developments over the years, Donald Trump, his company and partners repeatedly turned to wealthy Russians and oligarchs from former Soviet republics — several allegedly connected to organized crime, according to a USA TODAY review of court cases, government and legal documents and an interview with a former federal prosecutor.

The president and his companies have been linked to at least 10 wealthy former Soviet businessmen with alleged ties to criminal organizations or money laundering.

Among them:

• A partner in the firm that developed the Trump SoHo Hotel in New York is a twice-convicted felon who spent a year in prison for stabbing a man and later scouted for Trump investments in Russia.

• An investor in the SoHo project was accused by Belgian authorities in 2011 in a $55 million money-laundering scheme.

• Three owners of Trump condos in Florida and Manhattan were accused in federal indictments of belonging to a Russian-American organized crime group and working for a major international crime boss based in Russia.

• A former mayor from Kazakhstan was accused in a federal lawsuit filed in Los Angeles in 2014 of hiding millions of dollars looted from his city, some of which was spent on three Trump SoHo units.

• A Ukrainian owner of two Trump condos in Florida was indicted in a money-laundering scheme involving a former prime minister of Ukraine.

Trump’s Russian connections are of heightened interest because of an FBI investigation into possible collusion between Trump’s presidential campaign and Russian operatives to interfere in last fall’s election. What’s more, Trump and his companies have had business dealings with Russians that go back decades, raising questions about whether his policies would be influenced by business considerations. [Continue reading…]

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Jared Kushner tempted by Russia’s bank of spies

Michael Weiss writes: Not every bank lists a convicted spy serving 30 months in an Ohio prison as its active deputy representative in New York. But then, not every bank is headed by a former spy, much less one found to have spent time with Jared Kushner during a “roadshow” last year, when Donald Trump’s son-in-law was then just a top campaign advisor and not a likely witness about to testify before a Senate committee on Russia’s meddling in U.S. democracy.

In those charmed days before the director of the FBI raised in an open session of Congress the very real possibility that some of the president’s men might be working on behalf of a hostile foreign power, there was the curious case of a Wall Street analyst who was handcuffed in his Bronx neighborhood in late Jan. 2015 after going out for groceries. His crime wasn’t peddling junk sub-primes to trusting pensioners but working for Moscow Center.

Evgeny Buryakov, a former tax inspector turned officer of the Sluzhba vneshney razvedki, or SVR, Russia’s foreign intelligence service, had arrived in the U.S. just weeks after the feds executed Operation Ghost Stories and brought down ten out of an 11-person spy ring of Russian “illegals,” without whom Anna Chapman’s clothing line and The Americans would now be impossible. [Continue reading…]

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Paul Manafort’s all-cash New York real estate purchases

WNYC reports: Paul J. Manafort, the former Trump campaign manager facing multiple investigations for his political and financial ties to Russia, has engaged in a series of puzzling real estate deals in New York City over the past 11 years.

Real estate and law enforcement experts say some of these transactions fit a pattern used in money laundering; together, they raise questions about Manafort’s activities in the New York City property market while he also was consulting for business and political leaders in the former Soviet Union.

Between 2006 and 2013, Manafort bought three homes in New York City, paying the full amount each time, so there was no mortgage.

Then, between April 2015 and January 2017 – a time span that included his service with the Trump campaign – Manafort borrowed about $12 million against those three New York City homes: one in Trump Tower, one in Soho, and one in Carroll Gardens, Brooklyn.

Manafort’s New York City transactions follow a pattern: Using shell companies, he purchased the homes in all-cash deals, then transferred the properties into his own name for no money and then took out hefty mortgages against them, according to property records. [Continue reading…]

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