U.S. Politics

Donald Trump was bailed out of bankruptcy by Russia crime bosses

Presumptive Republican presidential nominee Donald Trump speaks at the Trump Soho Hotel in New York on June 22, 2016. / AFP / KENA BETANCUR        (Photo credit should read KENA BETANCUR/AFP/Getty Images)

Trump speaks at Trump Soho, built in partnership with Bayrock | AFP Getty Images

DAILY KOS

By Mark Sumner

In 2008, Donald Trump Jr. attended a real estate conference, where he stated that

Russians make up a pretty disproportionate cross-section of a lot of our assets. We see a lot of money pouring in from Russia.

As it turns out, that may have been an understatement. Human rights lawyer Scott Horton, whose work in the region goes back to defending Andrei Sakharov and other Soviet dissidents, has gone through a series of studies by the Financial Times to show how funds from Russian crime lords bailed Trump out after yet anther bankruptcy. The conclusions are stark.

Among the powerful facts that DNI missed were a series of very deep studies published in the [Financial Times] that examined the structure and history of several major Trump real estate projects from the last decade—the period after his seventh bankruptcy and the cancellation of all his bank lines of credit. …

The money to build these projects flowed almost entirely from Russian sources. In other words, after his business crashed, Trump was floated and made to appear to operate a successful business enterprise through the infusion of hundreds in millions of cash from dark Russian sources.

He was their man.

Yes, even that much seems fantastic, and the details include business agencies acting as a front for the GRU, billionaire mobsters, a vast network of propaganda sources, and an American candidate completely under the thumb of the Kremlin.

It reads like the a B-grade spy novel, a plot both too convoluted—and too bluntly obvious—for John le Carré. The problem is it may not be a conspiracy theory. It may be a conspiracy.

Horton’s analysis comes from piecing together information in three Financial Times “deep reports.” One of these focused on Sergei Millian, the head of the Russian American Chamber of Commerce in the US at the time of Trump Jr.’s “money pouring in from Russia” claim.

Mr Millian insists his Russian American Chamber of Commerce (RACC) has nothing to do with the Russian government. He says it is funded by payments from its commercial members alone.

Most of the board members are obscure entities and nearly half of their telephone numbers went unanswered when called by the Financial Times. An FT reporter found no trace of the Chamber of Commerce at the Wall Street address listed on its website.

Why was RACC’s background filled with so many holes? The Financial Times quotes former Russian MP Konstantin Borovoi in tagging the chamber as a front for intelligence operations that dates back to Soviet times.

“The chamber of commerce institutions are the visible part of the agent network . . . Russia has spent huge amounts of money on this.”

Millian helped arrange for Trump to visit Moscow in 2007, and had other outings with Trump in the states, including a visit to horse races in Miami. Millian claims that he had the right to market Trump properties in Russia.

“You could say I was their exclusive broker,” he told Ria. “Then, in 2007-2008, dozens of Russians bought apartments in Trump properties in the US.” He later told ABC television that the Trump Organisation had received “hundreds of millions of dollars” through deals with Russian businessmen.

Despite documents and photos showing Trump with Millian, Trump denied their association during the campaign.

Hope Hicks, Mr Trump’s campaign spokeswoman, said Mr Trump had “met and spoke” with Mr Millian only “on one occasion almost a decade ago at a hotel opening”.

The second Financial Times article puts Trump at the middle of a money laundering scheme, in which his real estate deals were used to hide not just an infusion of capital from Russia and former Soviet states, but to launder hundreds of millions looted by oligarchs. All Trump had to do was close his eyes to the source of the money, and suddenly empty apartments were going for top dollar.

Among the dozens of companies the Almaty lawyers say the Khrapunov laundering network used were three called Soho 3310, Soho 3311 and Soho 3203. Each was a limited liability company, meaning their ownership could easily be concealed.

The companies were created in April 2013 in New York. A week later, property records show, they paid a total of $3.1m to buy the apartments that corresponded with their names in the Trump Soho, a 46-storey luxury hotel-condominium completed in 2010 in a chic corner of Manhattan.

Why would Trump’s organization make such a good means of laundering funds? Because real estate has an arbitrary value. Is that apartment worth $1 million? Two million? Why not $3 million for a buyer who really wants it? When the whole transaction is just one LLC with undisclosed ownership paying another LLC with undisclosed ownership, it’s even neater than hiding the money in an offshore account. And while some businesses require due diligence in looking at the source of funds, real estate is a bit more … flexible.

The laws regulating US real estate deals are scant, experts say. Provisions against terrorism financing in the Patriot Act, passed in the aftermath of the September 11 2001 attacks, obliged mortgage lenders to conduct “know your customer” research. But money launderers pay in cash. Sales such as those of the Trump Soho apartments have passed through this loophole, which was partially closed only this year.

Converting funds stolen overseas into property in the US and cash in the account of an LLC represented a win for both the oligarchs and Trump. Best of all, Trump’s sole requirement was that he pay scant attention to the deal—something at which he was already a proven master. For example, the actual owners of the Trump Soho were another limited liability company, Bayrock. Trump was a partner in the LLC and Bayrock cut the checks Trump received when those apartments were sold. And yet …

In a 2011 deposition, given in a dispute over the Fort Lauderdale project, Mr Trump said he had “never really understood who owned Bayrock”. Jody Kriss, a former Bayrock finance director, has claimed in racketeering lawsuits against his former employer that Bayrock’s backers included “hidden interests in Russia and Kazakhstan”. Bayrock has denied Mr Kriss’s allegations but declined to answer questions about the source of its funds and its relationship with the Khrapunovs.

The third article digs more deeply into the origins of Bayrock and its connection with Trump. That connection … was very close.

The Republican presidential nominee and Bayrock were both based in Trump Tower and they joined forces to pursue deals around the world — from New York, Florida, Arizona and Colorado in the US to Turkey, Poland, Russia and Ukraine. Their best-known collaboration — Trump SoHo, a 46-storey hotel-condominium completed in 2010 — was featured in Mr Trump’s NBC television show The Apprentice.

This is the same group about which Trump said he “never really understood” the ownership.

“I don’t know who owns Bayrock,” Mr Trump said. “I never really understood who owned Bayrock. I know they’re a developer that’s done quite a bit of work. But I don’t know how they have their ownership broken down.”

At the very least, Trump confessed to partnering with, taking money from, and acting as a representative for a corporation whose ownership he didn’t know, in deals that totaled hundreds of millions in countries around the world. However, it seems far more likely that Trump knowingly worked with oligarchs, groups associated with the Russian government, and plain old mobsters. Why? Because he was desperate.

By the 2000s, the property developer and casino owner with ready access to the capital markets and the biggest New York banks was no more. A series of corporate bankruptcies had limited his financing options. Mr Trump had become an entertainer who portrayed a tycoon on television and licensed his name to businesses looking for a brand, leading to fee-making opportunities as disparate as Trump University and Trump Vodka.

The Trump Organization was a hollow shell and Trump was bankrupt, but Donald Trump the public figure was a “successful businessman,” a screen behind which criminal activity could be carried out on a massive scale. Throwing his name at every scheme in existence wasn’t a strategy, it was a fire sale on Trump’s respectability. Steaks? Water? Vodka? Fake real estate school? You pony up the cash, and Trump will slap his name on it. Because by the early 2000s, Trump wasn’t just broke, he had nothing left to pawn. He wasn’t a successful businessman, but he still played one on TV. His image had more value than his real estate portfolio.

But the apartments and buildings where Trump held some degree of ownership could be turned into value again. All it took was partnering with foreign crime bosses looking for a place to stash their cash. To inflate the value of his portfolio, Trump had to do nothing other than look away as the dirty money poured in from one LLC to the next. Citizens in Russia, Kazakhstan, and other former Soviet states lost hundreds of millions, but Trump got a cut as looted funds flowed through offices and apartments in buildings that carried those critical gold letters.

Horton’s evaluation of this material in coordination with the declassified DNI report is that Trump actively worked with and for Russian interests.

What these exposes showed, is that Trump pursued the projects hand in glove with Russian mobsters who worked closely with Putin’s Kremlin …

But based on the information in the Financial Times report, it appears that there are actually two possible answers. Trump may have been actively involved with and working for Russian sources. He might also have simply played the role of useful idiot, displaying his readiness to feign ignorance about any deal … so long as it generated some funds to float his sinking boat.

In the end, there’s not a lot of difference in the outcome. Trump got money. Oligarchs cleaned their cash. Russia got their man.

 

 

15 thoughts on “Donald Trump was bailed out of bankruptcy by Russia crime bosses

  1. Dear Sheils,

    I just blogged, “Breaking News: Russians May Have Compromised The Republican President-Elect.” BuzzFeed has published compromising data collected by Russia. DT is already tweeting that what has been published is “fake news.” Maybe now, republicans will look at this issue with the gravitas it deserves.

    The memos are unbelievable, Gronda

    Like

  2. I am not sure we disagree. I’m still trying to weed it out and reach more refined conclusions.

    “In short, because the U.S. made mistakes in the past does not mean that we continue to make errors in judgment today.”
    I can’t even begin to respond to this. Have we been getting a ton of gold stars in Santa’s naughty and nice book ?

    Like

  3. Trump claimed Obama was not born in the United States, and that Ted Cruz shouldn’t be considered because he was born in
    Canada. Has anyone checked to see whether or not Trump has dual US/Russia Citizenship?

    Liked by 1 person

  4. The revelations are very distasteful to put it mildly. However, ” candidate completely under the thumb of the Kremlin”may be overstating possible dependence of Trump on these financial allies. Crime syndicates do hold and finance legitimate businesses even in US and have ties to legitimate business for legitimate purposes. But as president and the leader of the most powerful military and economic entity on the planet to suggest that as president Trump is under any one’s thumb is silly.

    Like

  5. Dear Sheila,

    Thanks for this post. I am thrilled that reporters are beginning to connect the dots. There so many clues like his denial of Russia’s meddling in the 2016 U.S. presidential election by hacking U.S. institutions and leaking sensitive information; as well as his denial of climate change science despite overwhelming evidence that proves otherwise in both cases.

    One has to add all the other pieces of the puzzle to the above, like his pro-Russian rhetoric throughout the presidential campaign season. He has frequently verbalized the Russian President Vladimir Putin’s very own policies against NATO and questioned its sanctions against Russia for its invasion of Crimea with its annexation of this region which the international community has denounced. The president-elect has made off the cuff remarks like the people in Crimea were already Russian, and so what’s the big deal. All this pro Russian attitude bore fruit, when the U.S. policy towards Russia regarding Ukraine was deleted from the republican platform.

    On March 6, 2014, Washington Post’s two guest authors challenged the president-elect’s assertions that the Crimean’s definitely wanted to be part of Russia, before Russia invaded it in 2014. The following are excerpts from this article, “Do Crimeans actually want to join Russia?”

    “However, it is worth noting that only only 1 percent of Crimeans mentioned Russia as a homeland and only 10 percent mentioned the Soviet Union. This suggests that even though Crimeans have much stronger pro-Russian geo-political preferences than other Ukrainians, these preferences did not translate into a strong emotional identification with Russia. Moreover, in a more recent Razumkov Center survey (from December 21-25 2013), while substantial minorities endorsed either Crimean independence (35 percent) or joining “another state” (29 percent), a majority (56 percent was opposed to either of the political options involving Crimea’s separation from Ukraine. Of course, it is anyone’s guess how these proportions have been affected by the events of the past two months in the context of a highly partisan political and informational environment.”

    Then there are his business dealings with Russia as detailed in this blog, along with his pick to be Secretary of State, Rex Tillerson, Exxon’s CEO with strong ties to Russia. Mr. Tillerson made an oil deal with Russia with a value upwards of $500 billion dollars which has been on hold due to 2014 U.S. and NATO’s sanctions v Russis due to their unprovoked invasion into Crimea, Ukraine.

    He is not stumbling into all of this. He knows exactly why and what he is doing. This is why he frequently disparages the media and the intelligence community. He needs to immunize himself against all the negative data that will be forthcoming v him from both institutions. Fortunately, the USA is not Russia. He cannot kill off his critics. Eventually, he will figure out that it does not pay to antagonize both these entities.

    Then there is the unclassified U.S. Intelligence Report regarding Russia’s meddling in our politics:

    Page 1-Putin has had many positive experiences working with Western political leaders whose business interests made them more disposed to deal with Russia, such as former Italian Prime Minister Silvio Berlusconi and former German Chancellor Gerhard Schroeder.

    Page 2-Cyber Espionage Against US Political Organizations. Russia’s intelligence services conducted cyber operations against targets associated with the 2016 US presidential election, including targets associated with both major US political parties (This would include the RNC.)

    This defines DT as a Russian asset. Because of the business ties and the fact that Russia has also penetrated Republican campaign related websites with the inevitable myriad of compromising information that can be released at any time, Russia owns DT. The question is, how many republicans are going to choose to be in the same boat.

    What I am praying for, is that somehow DT is pulled into court due to his “conflicts of interest” issues, so that his IRS tax returns can be subpoenaed.

    As you might have guessed, I have already blogged on a lot of what is in this post, but there is some new data for me, “Millian helped arrange for Trump to visit Moscow in 2007, and had other outings with Trump in the states, including a visit to horse races in Miami. Millian claims that he had the right to market Trump properties in Russia. You could say I was their exclusive broker,” he told Ria. “

    I am convinced that the Russian connection is DT’s Achilles heel. Gronda

    Like

    1. What was this “sensitive information ” that was leaked. ? If the sensitive information was true and exposed things wouldn’t we all want to have that information ? Isn’t that what a free press does ? So what difference is it when facts come to light from a clandestine operation. Democrats so embarrassed that they try to divert attention from their foibles to the matter of evil Russian hacking as the issue . Influence election results ? US has done this all over the world for decades. Beyond that US has set up new coups and regimes and destroyed old ones. Even had Allende murdered. How’s that for interference ?

      Liked by 2 people

      1. Dear Carl D’Agostino,

        The difference is that according to the report, Russia hacked both democratic and republican campaign related websites, but only leaked data embarrassing to democrats and HRC.

        If you can say that it would have been okay for Russia to hack US republican websites for embarrassing material to be leaked and disseminated by US media in a way that harmed the republican presidential candidate, then your argument has merit.

        As per history.com, The U.S. government and its Central Intelligence Agency (CIA) had worked for three years to foment a coup against Allende, who was regarded by the Nixon administration as a threat to democracy in Chile and Latin America. Ironically, the democratically elected Allende was succeeded by the brutal dictator General Augusto Pinochet, who ruled over Chile with an iron fist for the next 17 years. Please note that this coup happened in 1973 under the republican administration of President Richard Nixon.

        The 1/5/17 intelligence unclassified report, states specifically that Russia also hacked republican campaign related websites and I am certain that there were embarrassing material that was found which Russia can use as a club to have republicans do their bidding. Eventually, my republican brothers and sisters will figure this out and then they will take this issue, seriously.

        Thanks for stopping by, Gronda

        Like

          1. Dear Carl D’Agostino,

            Technically, Allende shot himself as the coup was being successfully executed with CIA influence.

            What most folks in the intelligence community are worried about, is DT’s downplaying of Russia’s practices under President Putin who has had rivals and critics murdered in recent years. After all, he is an ex KGB director.

            Frankly, to my way of thinking, the Allende suicide in 1973 is deflecting from issues at hand in 2017.

            It looks like this is a discussion that we will have to respectfully be in disagreement.

            Like

          2. Dear Carl D’Agostino.

            To my way of thinking both incidents occurred many years ago (40 yrs. plus)and are a way of defecting from the serious issues at hand in 2017.

            In short, because the U.S. made mistakes in the past does not mean that we continue to make errors in judgment today. It is real simple. The U.S. national security should be a top priority.

            We will have to respectfully disagree.

            Like

        1. Beside the hacking and let’s say there existed publication of those conversations by Russians. I am surprised that is the issue. That was hacking into chit chat. The issue should be party carelessness and individual carelessness in being oblivious to security protocols and even more disturbing is that the commander of chief and our military and security agencies seem to have little or no understanding of cyber war and measures that need to be taken. I hope I am wrong. Cyber attack will be the next Pearl Harbor and seems it will not be perpetuated by the super powers but by terrorists and rogue nations.

          Liked by 1 person

          1. Dear Carl Agostino,

            Don’t forget that both democratic and republican campaign related websites were hacked/ successfully penetrated by Russian agents. I am certain that republicans were no more circumspect in their internal campaign planning than the democrats.

            You bet. This is part of US vulnerabilities regarding cyber security.

            There is a lot of work now being done in this arena.

            Make no mistake…Russian hacking to influence elections strategies needs to be mitigated and hampered. This is a non partisan issue, or at least, it should be.

            Liked by 1 person

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