Felix Sater has a lot to tell about Trump business both abroad and here in country. I hope he's part of the impeachment investigation.In 2006, Donald Trump Jr. and Ivanka Trump traveled to Ukraine to meet with government officials about building a multimillion dollar hotel and golf course in the country. Two years later, Trump Jr. was back to meet with developers.
The Trumps were looking to erect luxury resorts across the former Soviet republics, and Ukraine seemed like a promising location. But doing so meant navigating a landscape that had long struggled with corruption. And as part of its overtures, the Trump Organization engaged developers Dmitry Buriak and felon Felix Sater, both of whom have had business interests in Russia.
Politico
They're aware now. I suggest they start digging.Now, a decade after his company’s efforts floundered, President Donald Trump is arguing that it’s the son of his political rival Joe Biden, not him, who wanted to benefit from what he calls a “very corrupt” Ukraine.
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There are no accusations that the Trump Organization crossed any legal lines with its early-2000s effort in Ukraine — much of which has not been previously reported in American media. But the overtures offer another example of the complications of a businessman-turned-president making foreign policy decisions in places where he has had — or tried to have — significant financial interests.
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House and Senate committees appear to be unaware of the Trump Organization’s prior Ukraine connections, according to more than half a dozen lawmakers and staffers. The new details are based on court documents, government emails obtained by the conservative group Judicial Watch and foreign media reports, some of which were translated.
We KNOW Donald Trump. He has no foreign policy other than his business dealings.The Trump Organization did not respond to a request for comment, but the White House said any past Ukrainian business dealings have nothing to do with Trump’s foreign policy.
Ask Felix Sater and Paul Manafort.After hearing Trump tried to open a resort in Ukraine, Biden’s campaign called on Trump to release information about the efforts.
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After winning the presidency, Trump ignored calls to fully separate himself from the Trump Organization, which is composed of more than 500 businesses but is not required to publicly release financial data. The president still owns his business but has placed his holdings in a trust designed to hold assets for his benefit. He can receive money from the trust at any time without the public’s knowledge.
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Trump’s company considered at least two developments in Ukraine — a hotel and golf course in Kyiv and a hotel and yacht club in the seaside city of Yalta, which is now part of the Russian-annexed area of Crimea. The Ukrainian government granted the organization the right to build properties in both cities, according to news reports. It’s unclear why neither project got off the ground.
Sounds a little fishy. Maybe something other than acutal real estate development was going on.The Trump Organization worked with Buriak, whose company, DeVision, bills itself as one of the largest real estate businesses in Ukraine. Buriak also served as vice president at DeVision’s parent company, Petrochemical Holding, whose managing director was convicted in 2002 of abuse of power related to his work at the Russian government-owned energy giant Gazprom.
Separately, Lithuanian law enforcement investigated whether Buriak and another company partly owned by Petrochemical Holding funneled money from Russian special services to Lithuanian’s ruling Labor Party in the 2000s. And a recent investigation by Lithuania’s legislative body into political and electoral interference suggested Petrochemical Holding and Buriak were both “posing a threat to the interests of Lithuania.”
The Trump organization also worked with Sater, who pleaded guilty in 1998 to helping run a $40 million stock-fraud scheme that involved organized crime associates, according to prosecutors.
Sater later emerged during the 2016 U.S. presidential election as a go-between for Trump’s efforts to construct a Trump Tower in Moscow, making him a featured player in special counsel Robert Mueller’s investigation into Russia election interference.
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“I remember we were In Yalta. I remember we were looking at opportunities,” Sater said in a 2008 deposition. “I remember speaking to the Trump Organization about that opportunity. I even remember the specific opportunity, and we discussed it with them. … It didn’t get to the finish line.”
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Trump’s children also directly engaged Ukrainian officials.
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Buriak — the chairman of DeVision — said at the time that Trump Jr. favored two projects: the Euro Park hotel in Kyiv, which was worth $60 million, and a golf club in Koncha-Zaspa, an area in the southern part of the city.
But the Trump Organization’s efforts in Ukraine faded. In fact, the company’s broader push in the former Soviet Union never resulted in any completed properties. Trump pulled out of a deal to develop a 47-story luxury tower in the Black Sea resort town of Batumi, Georgia. And a Trump high-rise in Baku, the capital of Azerbaijan, remains unfinished.
Mar 6, 2017
On a building that was never completed.An unopened Trump hotel in Azerbaijan has been linked to corrupt officials who support the Iran's Islamic Revolutionary Guard Corps, reports Adam Davidson in a New Yorker piece.
Trump International Hotel & Tower Baku, a sleek 5-star hotel in the shape of a ship sail in Azerbaijan's capital, never opened despite appearing nearly complete.
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Even though the hotel has Trump's name emblazoned on it and had previously been posted as a future project on Trump Organization's website, the organization's chief legal officer Alan Garten said that Trump played only a nominal role in construction of the hotel — he was "merely a licensor" who had allowed Anar Mammadov, the son of powerful Azerbaijani oligarch Ziya Mammadov, to use his name, the New Yorker reports.
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But some in Azerbaijan allege the Trumps had a more active hand in the project. “We were always following their instructions," an unnamed Azerbaijani lawyer involved with the project told The New Yorker. "We were in constant contact with the Trump Organization. They approved the smallest details."
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Trump's own financial disclosure report showed that he earned $2.5 million in income from the project between January 2014 and July 2015 and an additional $323,000 afterwards.
Business Insider
April 28, 2018:A few weeks before Trump took office as President, he cancelled construction of the nearly-finished building in Baku to avoid potential conflicts of interest even though the construction was in its final stages.
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Azerbaijan consistently ranks as one of the most corrupt countries in the world by human rights watchdogs.
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According to The New Yorker, the Trump Organization signed off on the deal with the powerful Mammadov family who, aside from regularly getting called out for exploiting political power to increase personal wealth, has reported ties with Iran's Islamic Revolutionary Guard Corps — an extremist military force that has helped finance Iran's nuclear weapons program and trained terror organizations like Hezbollah.
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"The entire Baku deal is a giant red flag—the direct involvement of foreign government officials and their relatives in Azerbaijan with ties to the Iranian Revolutionary Guard," Jessica Tillipman, an assistant dean specializing in government anti-corruption at George Washington University Law School told the New Yorker. "Corruption warning signs are rarely more obvious."
A mutli-floor blaze has broken out in the unfinished Trump International Hotel and Tower in the Azerbaijani capital of Baku, the Independent has reported. Just weeks after a man died in a fire at the Trump Tower in New York, Azerbaijani emergency services rushed to the 33-storey hotel to battle flames consuming the building's middle floors.
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The cause of the fire is under investigation.
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The building has been under construction for 10 years, but is yet to open.
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The Baku tower has been a source of controversy for Trump and his family. The company that previously owned the project—Baku XXI Century—is affiliated with Ziya Mammadov, the former Azerbaijani transportation minister that the New Yorker called "one of the country's wealthiest and most powerful oligarchs."
Construction on the $35 million building was delayed in 2015. The Trump Organization blamed the local developers for the hold-up, and said, "the project is currently held in abeyance and not being actively marketed."
Newsweek
Location, location, location.Heydar Aliyev Prospekti, a broad avenue in Baku, the capital of Azerbaijan, connects the airport to the city. The road is meant to highlight Baku’s recent modernization, and it is lined with sleek new buildings. [...] “It’s like Potemkin,” my translator told me. “It’s only the buildings right next to the road.” Behind the gleaming structures stand decaying Soviet-era apartment blocks, with clothes hanging out of windows and wallboards exposed by fallen brickwork.
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Reaching the [abandoned Trump hotel] property is surprisingly difficult; the tower stands amid a welter of on-ramps, off-ramps, and overpasses. During the nine days I was in town, I went to the site half a dozen times, and on each occasion I had a comical exchange with a taxi-driver who had no idea which combination of turns would lead to the building’s entrance.
The New Yorker
Something tells me it wasn't.The more time I spent in the neighborhood, the more I wondered how the hotel could have been imagined as a viable business.
Can you say "money-laundering"?A former top official in Azerbaijan’s Ministry of Tourism says that, when he learned of the Trump hotel project, he asked himself, “Why would someone put a luxury hotel there? Nobody who can afford to stay there would want to be in that neighborhood.”
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For an expensive hotel, the Trump Tower Baku is in an oddly unglamorous location: the underdeveloped eastern end of downtown, which is dominated by train tracks and is miles from the main business district, on the west side of the city. Across the street from the hotel is a discount shopping center; the area is filled with narrow, dingy shops and hookah bars. Other hotels nearby are low-budget options: at the AYF Palace, most rooms are forty-two dollars a night. There are no upscale restaurants or shops.
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There is a long-term master plan to develop the area around the Trump Tower Baku, but if it is implemented the hotel will be surrounded for years by noisy construction projects, making it even less appealing to travellers desiring a luxurious experience—especially considering that there are many established hotels on the city’s seaside promenade. There, an executive from ExxonMobil or the Israeli cell-phone industry can stay at the Four Seasons, which occupies a limestone building that evokes a French colonial palace, or at the J. W. Marriott Absheron Baku, which has an outdoor terrace overlooking the water. Tiffany, Ralph Lauren, and Armani are among the dozens of companies that have boutiques along the promenade.
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The timing of the project was also curious. By 2014, when the Trump Organization publicly announced that it was helping to turn the tower into a hotel, a construction boom in Baku had ended, and the occupancy rate for luxury hotels in the city hovered around thirty-five per cent.
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The Azerbaijanis behind the project were close relatives of Ziya Mammadov, the Transportation Minister and one of the country’s wealthiest and most powerful oligarchs. [...] At the time of the hotel deal, Mammadov, a career government official, had a salary of about twelve thousand dollars, but he was a billionaire.
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By the time the Trump team officially joined the project, in May, 2012, many condominium residences had already been completed; at the insistence of Trump Organization staffers, most of the building’s interior was gutted and rebuilt, and several elevators were added.
The Trump Organization claimed Trump had nothing more to do with the project than lease his name (which has really been his main "real estate" business for some time).
And she had to see the location and all the negative aspects of trying to develop a luxury hotel there. She's not that ignorant. She's as involved in money laundering as Trump himself.An Azerbaijani lawyer who worked on the project revealed to me that the Trump Organization had not just licensed the family name; it also had signed a technical-services agreement in which it promised to help its partner meet Trump design standards. Technical-services agreements are often nominal addenda to licensing deals. Major hospitality brands compile exhaustive specifications for licensed hotels, and tend to approve design elements remotely; a foreign site is visited only occasionally. But in the case of Trump Tower Baku the oversight appears to have been extensive. The Azerbaijani lawyer told me, “We were always following their instructions. We were in constant contact with the Trump Organization. They approved the smallest details.” He said that Trump staff visited Baku at least monthly to give the go-ahead for the next round of work orders. Trump designers went to Turkey to vet the furniture and fabrics acquired there. The hotel’s main designer, Pierre Baillargeon, and several contractors told me that they had visited the Trump Organization headquarters, in New York, to secure approval for their plans.
Ivanka Trump was the most senior Trump Organization official on the Baku project. In October, 2014, she visited the city to tour the site and offer advice.
I bet she did.The Azerbaijani lawyer said, “Ivanka personally approved everything.” A subcontractor noted that Ivanka’s team was particular about wood panelling: it chose an expensive Macassar ebony, from Indonesia, for the ceiling of the lobby. The ballroom doors were to be made of book-matched panels of walnut. On her Web site, Ivanka posted a photograph of herself wearing a hard hat inside the half-completed hotel. A caption reads, “Ivanka has overseen the development of Trump International Hotel & Tower Baku since its inception, and she recently returned from a trip to the fascinating city in Azerbaijan to check in on the project’s progress.” (Ivanka Trump declined requests to discuss the Baku project.)
And more of a problem if it's your own corrupt conduct, I presume.The sustained back-and-forth between the Trump Organization and the Mammadovs has legal significance. If parties involved in the Trump Tower Baku project participated in any illegal financial conduct, and if the Trump Organization exerted a degree of control over the project, the company could be vulnerable to criminal prosecution. Tom Fox, a Houston lawyer who specializes in anti-corruption compliance, said, “It’s a problem if you’re making a profit off of someone else’s corrupt conduct.”
The fact that the hotel executive is afraid of "reprisal" from Trump for stating such an obvious and non-personal remark should tell you something about Trump. Something very mobbish.Moreover, recent case law has established that licensors take on a greater legal burden when they assume roles normally reserved for developers. The Trump Organization’s unusually deep engagement with Baku XXI Century suggests that it had the opportunity and the responsibility to monitor it for corruption.
Before signing a deal with a foreign partner, American companies, including major hotel chains, conduct risk assessments and background checks that take a close look at the country, the prospective partner, and the people involved. Countless accounting and law firms perform this service, as do many specialized investigation companies; a baseline report normally costs between ten thousand and twenty-five thousand dollars. A senior executive at one of the largest American hotel chains, who asked for anonymity because he feared reprisal from the Trump Administration, said, “We wouldn’t look at due diligence as a burden. There certainly is a cost to doing it, especially in higher-risk places. But it’s as much an investment in the protection of that brand. It’s money well spent.”
So who was getting paid to let the Trump Organization slide?[Trump Org attorney] Alan Garten told me that the Trump Organization had commissioned a risk assessment for the Baku deal, but declined to name the company that had performed it. The Washington Post article on the Baku project reported that, according to Garten, the Trump Organization had undertaken “extensive due diligence” before making the hotel deal and had not discovered “any red flags.”
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I asked Garten how deeply the Trump Organization had looked into the Mammadov family’s political connections. Had it been concerned that Elton Mammadov, as a sitting member of parliament, might exploit his power to benefit the project? How much money had Ziya Mammadov invested in Elton’s company? Garten noted that he didn’t oversee the due-diligence process. “The people who did are no longer at the company,” he said.
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The Foreign Corrupt Practices Act, passed in 1977, forbade American companies from participating in a scheme to reward a foreign government official in exchange for material benefit or preferential treatment. The law even made it a crime for an American company to unknowingly benefit from a partner’s corruption if it could have discovered illicit activity but avoided doing so. This closed what was known as the “head in the sand” loophole.
Nothing suspicious there. Of course, Trump didn't take over the building until 2012. I'm sure everything was above-board thereafter.Construction of the building began in 2008. I have spoken with more than a dozen contractors who worked on it. Some of them described behavior that seemed nakedly corrupt. Frank McDonald, an Englishman who has had a long career doing construction jobs in developing countries, performed extensive work on the building’s interior. He told me that his firm was always paid in cash, and that he witnessed other contractors being paid in the same way. At the offices of Anar Mammadov’s company, he said, “they would give us a giant pile of cash,” adding, “I got a hundred and eighty thousand dollars one time, which I fit into my laptop bag, and two hundred thousand dollars another time.” Once, a colleague of his picked up a payment of two million dollars. “He needed to bring a big duffelbag,” McDonald recalled.
Sound familiar? Okay, okay, you got me: there was corruption, but we're blameless.Alan Garten, the Trump Organization lawyer, did not deny that there was corruption involved in the project. “I’m not going to sit here and defend the Mammadovs,” he said. But, from a legal standpoint, he argued, the Trump Organization was blameless. In his opinion, the Foreign Corrupt Practices Act doesn’t apply to the Baku deal, even if corruption occurred. “We didn’t own it,” he said of the hotel. “We had no equity. We didn’t control the project. The flow of funds is in the wrong direction.” He added, “We did not pay any money to anyone. Therefore, it could not be a violation of the F.C.P.A.”
And doesn't that also sound familiar? Yes, I'm corrupt. And there's nothing wrong with that. Are you comfortable under that bus?“No, that’s just wrong,” Jessica Tillipman, an assistant dean at George Washington University Law School, who specializes in the F.C.P.A., said. “You can’t go into business deals in Azerbaijan assuming that you are immune from the F.C.P.A.” She added, “Nor can you escape liability by looking the other way. The entire Baku deal is a giant red flag—the direct involvement of foreign government officials and their relatives in Azerbaijan with ties to the Iranian Revolutionary Guard. Corruption warning signs are rarely more obvious.”
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Tillipman, along with several other F.C.P.A. experts, told me that the Trump Organization had clearly provided things of value in the Baku deal: its famous brand, its command of the luxury market, its extensive technical advice.
In May, 2012, the month the Baku deal was finalized, the F.C.P.A. was evidently on Donald Trump’s mind. In a phone-in appearance on CNBC, he expressed frustration with the law. “Every other country goes into these places and they do what they have to do,” he said. “It’s a horrible law and it should be changed.” If American companies refused to give bribes, he said, “you’ll do business nowhere.”
Say what? There's no rush; it's stalled anyhow?Throughout the Presidential campaign, Trump was in business with someone that his company knew was likely a partner with the Iranian Revolutionary Guard.
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I asked Garten why the Trump Organization hadn’t cancelled the Baku contract in 2015. He said that there was “no rush,” because “the project had already stalled and was showing no signs of moving forward.”
He was Jared Kushner's partner in Trump' dealings with Israel. Interestingly, Greenblatt has just recently resigned his post.Moreover, Garten said, the Trump Organization had signed binding contracts with the Mammadovs and couldn’t simply abandon its agreements. But Jessica Tillipman, the law-school assistant dean, told me, “You can’t violate sanctions just because you have a contract with someone.”
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The Baku project is hardly the only instance in which the Trump Organization has been associated with a controversial deal. The Trump Taj Mahal casino, which opened in Atlantic City in 1990, was repeatedly fined for violating anti-money-laundering laws, up until its collapse, late last year. According to ProPublica, Trump projects in India, Uruguay, Georgia, Indonesia, and the Philippines have involved government officials or people with close ties to powerful political figures. A few years ago, the Trump Organization abandoned a project in Beijing after its Chinese partner became embroiled in a corruption scandal. In December, the Trump Organization withdrew from a hotel project in Rio de Janeiro after it was revealed to be part of a major bribery investigation. Ricardo Ayres, a Brazilian state legislator, told Bloomberg, “It’s curious that the Trumps didn’t seem to know that their biggest deal in Brazil was bankrolled by shady investors.”
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Garten has been the company’s chief legal officer only since January. His predecessor was Jason Greenblatt, whose name appeared on the contract I reviewed. Greenblatt was in charge of the Trump Organization’s due diligence and contracting work. He is now employed at the White House, as the President’s special representative for international negotiations. He did not respond to repeated requests for comment.
There's so much more in this 2017 New Yorker article. Read it here if you're interested.
...but hey, do what you want...you will anyway.
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