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The Russian Connection: Felix Slater, RICO and Trump

Donald Trump’s connections to Russian organized crime is getting greater scrutiny by special counsel Robert Mueller and his team. Trump’s association with a known convicted felon could lead to charges against Trump for financial fraud. Earlier this week in Brooklyn Federal Court, a lawyer representing an investigative reporter requested that the documents related to Slater’s guilty plea in a $40 million Mafia stock fraud scheme and how he avoided prison time be made public. The documents include the complaint, the cooperation agreement and the pre-sentencing report from Sater’s case. The lawyer, Richard Lerner, argued that the documents may contain evidence that Donald Trump committed financial fraud by knowingly doing real estate deals with a known felon.

Now, Mueller has hired Andrew Weissman, one of the prosecutors in the 1998 mob stock-scam case during which Felix Sater flipped.

On Monday night MSNBC’s Rachel Maddow spelled out the Mafia stock scheme, Russian mobsters, money laundering and Felix Slater’s involvement along with Trump and financial fraud.

Bloomberg View executive editor and columnist Timothy L. O’Brien has a close examination of Trump, Russia and his shadowy business partnerships

Robert Mueller is examining whether President Donald Trump obstructed justice when he fired James Comey as director of the Federal Bureau of Investigation, the Washington Post recently reported. As we’ve heard for months now, there is also a probe of possible collusion between Trump’s campaign team and the Kremlin to tilt the 2016 election in the president’s favor.

But the Justice Department inquiry led by Mueller now has added flavors. The Post noted that the investigation also includes “suspicious financial activity” involving “Russian operatives.” The New York Times was more specific in its account, saying that Mueller is looking at whether Trump associates laundered financial payoffs from Russian officials by channeling them through offshore accounts.

Trump has repeatedly labeled Comey’s and Mueller’s investigations “witch hunts,” and his lawyers have said that the last decade of his tax returns (which the president has declined to release) would show that he had no income or loans from Russian sources. In May, Trump told NBC that he has no property or investments in Russia. “I am not involved in Russia,” he said.

But that doesn’t address national security and other problems that might arise for the president if Russia is involved in Trump, either through potentially compromising U.S. business relationships or through funds that flowed into his wallet years ago. In that context, a troubling history of Trump’s dealings with Russians exists outside of Russia: in a dormant real-estate development firm, the Bayrock Group, which once operated just two floors beneath the president’s own office in Trump Tower.

Bayrock partnered with the future president and his two eldest children, Donald Jr. and Ivanka, on a series of real-estate deals between 2002 and about 2011, the most prominent being the troubled Trump Soho hotel and condominium in Manhattan.

During the years that Bayrock and Trump did deals together, the company was also a bridge between murky European funding and a number of projects in the U.S. to which the president once lent his name in exchange for handsome fees. Icelandic banks that dealt with Bayrock, for example, were easy marks for money launderers and foreign influence, according to interviews with government investigators, legislators, and others in Reykjavik, Brussels, Paris and London. Trump testified under oath in a 2007 deposition that Bayrock brought Russian investors to his Trump Tower office to discuss deals in Moscow, and said he was pondering investing there.

“It’s ridiculous that I wouldn’t be investing in Russia,” Trump said in that deposition. “Russia is one of the hottest places in the world for investment.”

One of Bayrock’s principals was a career criminal named Felix Sater who had ties to Russian and American organized crime groups. Before linking up with the company and with Trump, he had worked as a mob informant for the U.S. government, fled to Moscow to avoid criminal charges while boasting of his KGB and Kremlin contacts there, and had gone to prison for slashing apart another man’s face with a broken cocktail glass.

In a series of interviews and a lawsuit, a former Bayrock insider, Jody Kriss, claims that he eventually departed from the firm because he became convinced that Bayrock was actually a front for money laundering.

Kriss has sued Bayrock, alleging that in addition to laundering money, the Bayrock team also skimmed cash from the operation, dodged taxes and cheated him out of millions of dollars. Sater and others at Bayrock would not comment for this column; in court documents they have contested Kriss’s charges and describe him, essentially, as a disgruntled employee trying to shake them down.

But Kriss’s assertion that Bayrock was a criminal operation during the years it partnered with Trump has been deemed plausible enough to earn him a court victory: In December, a federal judge in New York said Kriss’s lawsuit against Bayrock, which he first filed nine years ago, could proceed as a racketeering case. [..]

Trump has said over the years that he barely knows Sater. In fact, Sater — who former Bayrock employees say met frequently with Trump in the Trump Organization’s New York headquarters, once shepherded the president’s children around Moscow and carried a Trump Organization business card — apparently has remained firmly in the orbit of the president and his closest advisers.

Sater made the front page of the New York Times in February for his role in a failed effort — along with Trump’s personal attorney, Michael Cohen — to lobby former National Security Adviser Michael Flynn on a Ukrainian peace proposal.

Comey was still Trump’s FBI director when he testified before the House Intelligence Committee in March about Russian interference in the 2016 election. During that hearing, Comey was asked if he was “aware of” Felix Sater, his criminal history and his business dealings with the Trump Organization. Comey declined to comment.

It’s unclear whether Sater and Bayrock are part of Mueller’s investigation. But Mueller has populated his investigative team with veteran prosecutors expert in white-collar fraud and Russian-organized-crime probes. One of them, Andrew Weissmann, once led an FBI team that examined financial fraud leading to the demise of Enron. Before that, Weissmann was a prosecutor with the U.S. attorney’s office in Brooklyn and part of a team that prosecuted Sater and mob associates for investment scams in the late 1990s.

However the Mueller probe unfolds, a tour of Trump’s partnership with Bayrock exposes a number of uncomfortable truths about the president’s business history, his judgment, and the possible vulnerabilities that his past as a freewheeling dealmaker — and his involvement with figures like Sater — have visited upon his present as the nation’s chief executive.

The rest of the article is well worth the read.

Rachel Maddow interviews Mr. O’Brien about his article and how Trump’s past business dealings could integrates with the investigation into Trump’s Russian connection.