A Russian Mobster Built Trump SoHo Into Putin’s Money Laundering Racket
A blizzard of lawsuits over the failed Trump SoHo condominium-hotel have exposed the President’s deep ties to Russian-based organized crime.
A former employee says the cash trail goes right to Putin.
The Trump Organization’s business partnership with Russian mobster Felix Sater — turned FBI informant — unraveled at the start of this decade when the Trump SoHo collapsed into a pile of fraud, contract and foreclosure lawsuits.
Now Sater is switching sides once again, agreeing to cooperate with plaintiffs in a massive money laundering probe.
The Trump SoHo lawsuits aren’t just a matter of commercial interest.
Special counsel Robert Mueller is reportedly looking into Trump’s international money laundering connections and links with Russian operatives as a means of accepting a Russian payoff.
My exclusive report about Felix Sater also exposed that he advised the Trump Campaign, and explained how the Trump Taj Mahal was used as a money laundering front as far back as 1998.
Sater ran a company named Bayrock, before being named the Trump Organization’s senior advisor, which only happened after the SoHo project failed, along with projects in Arizona and Fort Lauderdale.
CNN obtained public records showing that Trump Taj Mahal was cited by the IRS and fined by the US Treasury Department’s Financial Crimes Enforcement Network (FinCEN) for money laundering offenses dating all the way back to 1990.
FinCEN holds the records and settles fines for the US Treasury Department, it is the IRS which has Special Agents that investigate money laundering.
The Senate Intelligence Committee subpoenaed FinCEN’s investigatory files in May, which finally yielded 2,000 records last week. The nature of these offenses raises the specter that Donald Trump isn’t under IRS audit, but that he could be under investigation by the IRS’ criminal enforcement unit.
The IRS’ involvement indicates a high likelihood that some of Donald Trump’s tax returns could be part of the files.
Racketeering Lawsuit Against Bayrock Reveals Trump’s Cash Trail From Putin
The failed Trump SoHo condominium-hotel project yielded a lawsuit by former Bayrock executive Jody Kriss sued his former employer and Sater for refusing to pay employee-related bonuses he had earned.
Kriss told Bloomberg News that Sater financed the operations — which included major equity investments from Kazakstan — and he had a very strange method of determining whose money to borrow for projects:
Kriss said in an interview that an Icelandic competitor of the FL Group also contacted him to invest in Bayrock. When he took that offer to Sater and Arif they told him, he says, that the money behind Icelandic banks “was mostly Russian” — and that they had to take FL’s funds for deals they were doing with Trump because the investment firm was “closer to Putin.”
“I thought it was a lie or a joke when they said Putin,” Kriss recalls. “I didn’t know how to make sense of it at all.”
Sater is not cooperating in Kriss’ lawsuit against Bayrock.
But Iceland was awash in dirty money until the collapse of their banking sector in 2008, and a Russia was one of their major sources.
It was the failed Fort Lauderdale Trump Tower project which resulted in Felix Sater’s sealed felony conviction for racketeering with New York’s La Cosa Nostra being revealed.
Ironically, Sater’s criminal past was only revealed because he left a copy of the paperwork on a Bayrock hard drive after stepping down from his duties. A sympathetic whistleblower at the Bayrock company shared that information with Jody Kriss to help his case.
Donald Trump has testified under oath about Sater but mostly pretends like he doesn’t know the convicted felon:
“He was supposedly very close to the government of the United States as a witness or something,” Trump said. “I don’t think he was connected to the Mafia. He got into trouble because he got into a barroom fight.”
“I don’t know him very well,” Trump added, saying that he hadn’t conversed very often with Sater. “If he were sitting in the room right now I really wouldn’t know what he looked like.”
A New York federal judge granted part of a petition to unseal more of Sater’s records due to his relationship with the President.
But those records aren’t available yet.
BBC interviewed Donald Trump in 2013 and when he asked about the Trump SoHo project, the developer became very defensive and ended the interview.
Trump ran away rather than answer the BBC reporter’s questions.
Later, the Trump Organization put out their own secretly recorded copy of the interview and used blatantly obvious editing to excise the questions about Felix Sater.
Trump’s Old Business Partner Begins Cooperating In Money Laundering Investigation
Russian mobster Felix Sater ran Bayrock, the developer who funded the Manhattan Trump-branded condo-hotel project with money from the former Soviet state of Kazakstan and allegedly with Putin’s cash from banks in Iceland.
Felix Sater made headlines recently by sending extortion threats to some of Trump’s former partners from Kazakstan over the SoHo deal.
Now, the Financial Times reports that Sater has decided to cooperate with fraud investigators. FT wrote:
Mr. Sater has now agreed to co-operate with an international investigation into the alleged money-laundering network, five people with knowledge of the matter said. The co-operation has included working with a team of lawyers and private investigators pursuing civil cases across three continents, the people said. Mr Sater declined to comment.
Felix Sater, a Russian-born dealmaker with organised-crime connections who worked on property ventures including Trump Soho in Manhattan, has attracted attention in recent months as efforts continue to chart the links between the US president’s circle and moneymen from Russia and its neighbours.
It is unclear how much money has flowed from the alleged Kazakh laundering scheme to Mr Trump. Title deeds and banking records show that in April 2013 shell companies controlled by the Khrapunovs spent $3.1m buying three luxury apartments in Trump Soho from a holding company in which Mr Trump held a stake.
“Mr. Trump’s Kazakh connection also adds to the emerging picture of the president’s enigmatic relationship with the former Soviet Union. Questions about that relationship have dominated the early months of his presidency as multiple investigations examine claims his campaign colluded with Russian attempts to manipulate the 2016 presidential election.”
Private lawyers working on the case claim foreign investors may have used their profits from corruption to buy multiple units in the Trump’s most conspicuously failed project in New York City.
Fearing criminal prosecution, Trump settled one of the civil lawsuits in 2011, and the New York Times revealed that fear to be well founded.
In fact, the President’s lawyers demanded that disgruntled consumers promise to stop cooperating with prosecutors to get paid as they reported last year:
And hovering over it all was a criminal investigation, previously unreported, by the Manhattan district attorney into whether the fraud alleged by the condo buyers broke any laws, according to documents and interviews with five people familiar with it.
“The buyers initially helped in the investigation, but as part of their lawsuit settlement, they had to notify prosecutors that they no longer wished to do so. The criminal case was eventually closed.”
Trump gave Bayrock an arrangement sell his real estate brand around the world according to Forbes, including a proposed, but never materialized Trump Tower Moscow.
Trump is so terrified of talking about his involvement with Felix Sater, that lied in a sworn deposition swearing that he wouldn’t even recognize the Russian-American emigre.
Felix Sater spent a decade working as an informant for the FBI while working with Trump, at Trump Tower, after being convicted of a felony in secret for participating in a $40 million dollar Wall Street pump and dump penny stock scam with the Italian mafia.
More recently, the Sater was caught in bizarre a diplomatic back channel operation to Russia with Trump’s personal lawyer, Michael D. Cohen, who himself recently hired a criminal defense lawyer.
Sater’s plan to work with the now-fired National Security Advisor Gen. Flynn fell apart, and last month he became the first high-ranking member of Trump’s inner circle thought to become a cooperating witness against the President.
Conclusion
Donald Trump’s relationship with Felix Sater is far more important than he has ever publicly acknowledged, and points to extremely deep ties to Russian-based organized crime, as well as La Cosa Nostra.
Now that Felix Sater is going to cooperate with the Trump SoHo plaintiffs, the President could face criminal charges by New York’s Attorney General after the expiration of his term.
If so, Trump couldn’t use the power of the presidency to pardon state charges, because that power only applies to federal offenses.
I wrote these original stories for OccupyDemocrats.com as “A New Lawsuit Just Revealed Trump’s Cash Trail From Putin” and “Trump In Trouble As Old Business Partner Begins Cooperating In Money Laundering Investigation” and they have been edited together, and revised here.
