Category: Ukraine
Russian Money in UK Politics
In The Godfather, Part II, mobster Hyman Roth is asked by reporters why he moving to Israel.
“I’m a retired investor living on a pension, and I wished to live there as a Jew in the twilight of my life,” Roth explains.
Sergey Kopytov is a retired Ukrainian politician living out the twilight of his life in eastern Europe. Like the fictional Hyman Roth, Kopytov invests in hotels. Except Kopytov’s hotels are not located in Cuba, but rather in the Crimean Peninsula, where he served briefly as finance minister in the pro-Russia Ukraine Party of Regions.
The Hyman Roth of the Godfather Part II was looking for a man who wants to be president of the United States. Roth had the cash to help elect him. “We’re bigger than U.S. Steel,” Roth says.
The very real Sergey Kopytov may been looking for a man who wanted to be the UK Prime Minister. And like Roth, Kopytov had the cash to help make it happen.
A $630,225 donation to the UK’s Conservative Party in February 2018—money helped install Boris Johnson in the prime minister’s office at 10 Downing Street—came from Kopytov, according to a bank alert sent to the National Crime Agency.
The bank alert, which tracked the flow of funds from Russia to Britain, was first obtained by The New York Times. It also was detailed in the latest issue of the UK magazine, Private Eye.
“We were able to trace a clear line back from this donation to its ultimate source,” an official at Barclays Bank wrote on January 2021. That “ultimate source” was Sergei Nikolaevich Kopytov.
If true, this raises troubling questions about Russian influence in UK elections. As in the United States, UK political parties are barred from accepting contributions from foreigners. The Conservative Party donation, however, was given a sheen of respectability. It was made in the name of Kopytov’s son-in-law, Ehud Sheleg. The Israeli-born Sheleg is a UK citizen and owner of a posh London art gallery, and a former treasurer of the Conservative party.
“I believe that the flow of funds which began with a $2.5 million payment from Kopytov to his daughter Liliya, and which ended with the $630k donation to the Conservative party was designed to conceal its origins from an impermissible donor and therefore the people responsible for designing the flow of funds committed an offense which potentially qualifies as a criminal offense,” the Barclays banker wrote in the alert. Sheleg’s wife, the former Liliya Kopytova, is a former Miss Ukraine 30 years his junior.
“Kopytov can be stated with considerable certainty to have been the true source of the donation,” the alert states. It adds: “Kopytov is a Russian resident and there is no indication that he has a UK passport or is on the UK electoral roll.”
It’s part of a pattern of Russian money and influence flowing into the UK Conservative Party. Boris Johnson played tennis in 2014 with Lubov Chernukhin, the wife of a Russian former minister, in exchange for a £160,000 donation. Chernukhin donated almost £2 million to the Conservatives.
Even as the Kremlin meddled in UK elections and sent assassins to kill two former Russian spies living in England, Boris Johnson defended his decision to take questionable money connected to Russia. “It’s very important that we do not allow a miasma of suspicion about all Russians in London—and indeed all rich Russians in London—to be created,” Johnson told the BBC. The future prime minister made those remarks in March 2018, one month after Sheleg’s donation to Johnson’s party and mere days after the poisoning of retired military intelligence officer Sergei Skripal.
A lawyer for the Shelegs told The New York Times that the couple received millions from Kopytov in the weeks before the 2018 donation. But that was “entirely separate” from the campaign contribution. The explanation given was that Kopytov’s money, which derived from a property sale, repaid a loan made to Sheleg by his family’s trust.
In May 2018, Ehud Sheleg gave another £750,000 donation to the Conservative party. (That donation was not covered in the bank alert.) He was named co-treasurer of the party three months later, and took over sole responsibility for the job the following year. Sheleg stepped down as the Conservative treasurer in 2021, a few months after Barclays filed its suspicious activity report. His representatives say there was no connection between the two events.
Sheleg was one of the biggest single donors to the Conservative party. In total, he gave £3.6 million to the Conservative Party, which got him knighted by the queen.
It remains unclear why nearly three years elapsed before Barclays filed its suspicious activity report about Sheleg’s 2018 contribution.
The $2.5 million that made its way to Sheleg began its journey in Kopytov’s Russian bank account. It then passed through Austria’s Raffeisen Bank, according to Private Eye. Raffeisen has the greatest exposure to Russia of any foreign bank, with €22.9bn of assets at risk. Readers of my book, Trump/Russia, will not be surprised to hear this as there’s a long history of dirty Russian money flowing through Raiffeisen. An infamous 2006 US State Department cable released by Wikileaks stated that that Raiffeisen served as a front for the Russian gangster Semion Mogilevich.
It took weeks for the $2.5 million to land in the Shelegs joint bank account in Britain. The day after it arrived, Sheleg made his contribution to the Conservative party.
The Barclays bank alert that sounded the alarm about Sheleg’s contribution states “that sources, including a Private Eye article note Ehud Sheleg’s close relations with Moscow… [and] connections with organized crime figures.”
Sheleg’s connections with Moscow including hosting the Russian ambassador to the UK in 2015. His organized crime ties relate to a franchise of his Halcyon art gallery in Cyprus. One of the men involved, Rustem Magdeev, is accused in UK court documents of having connections to organized criminals, a charge he denies.
The role of treasurer of the Conservative Party is often a springboard to the House of Lords, the upper house of British parliament. Seven of the last 10 treasurers were made barons.
An elevation to life peer may now be out of Sheleg’s reach. Questions have arisen in parliament about Sheleg and Kopytov. “Exactly what current and former links do the Sheleg-Kopytov family hold with key actors in the Russian state? Finally, has electoral law been broken and, relatedly, has our national security been compromised?” the chair of the Labour Party asked on the floor of the House of Commons last month. Stephen Kinnock, a Welsh MP who was threatened with a libel lawsuit for questioning Sheleg’s ties to Russia, asked when the former Conservative Party treasurer should be labeled a foreign agent.
In The Godfather, Part II, Hyman Roth’s plans to take over Cuba were foiled by Fidel Castro. Exposing Sergey Kapytov as the “ultimate source” of a Conservative Party donation may have foiled his plans as well.
Mike Pence Has Something to Hide on Impeachment
President Trump reminds us every chance he gets to “READ THE TRANSCRIPT” of his “perfect” July 25 phone call with Ukraine’s new president.
But there’s another transcript that we can’t see, as we learned during Tuesday’s impeachment hearing. That’s a September 18th phone call between President Volodymyr Zelensky and Vice President Mike Pence.
The news came early in Tuesday morning’s House intelligence committee session featuring Jennifer Williams, a foreign service officer serving as Pence’s special advisor for Europe and Russia.
Justin Shur, Williams’ attorney, interrupted Chairman Adam Schiff to announce that “the office of the Vice President has taken the position that the September 18th call is classified.”
Last month, Pence said releasing transcripts of his conversations with Zelensky was fine with him.
I’d have no objection to that, and we’re discussing that with White House Counsel as we speak.
But when people see the transcripts of my calls and when they hear the reporting of our conversation — President Trump’s focus with Ukraine, from the very beginning, was on enlisting more European support and supporting President Zelensky’s efforts to advance reforms that would end an era of corruption in Ukraine.
White House press gaggle with VP Pence, October 10, 2019
But that was then. With the impeachment inquiry underway, Pence changed his mind.
The timing of the move to classify the call means that “the most transparent president in history” has a vice president with something to hide. It also hints that Pence was more deeply involved in Trump’s effort to use the leader of Ukraine as a political prop.
What’s strange about all this is that as recently as November 7th the Pence-Zelensky phone call wasn’t yet a secret.
The September 18th Phone Call
That’s the day that Jennifer Williams, the Pence aide who testified Tuesday, appeared before the House intelligence committee for her deposition. According to a transcript of the deposition – stamped “UNCLASSIFIED” on every page – Williams described the call in some detail, calling it a “very positive discussion.”
In her deposition, Williams testified that during the now-classified September 18th phone call, Pence had reiterated that the frozen military aid was now being released.
Even though the hold on the aid had been lifted, there were still things that the Ukrainians very much wanted, namely, a visit with the White House with President Trump. It was important for Zelensky, a novice politician, to show Ukrainians that the U.S. president had his back.
In addition, Pence told Zelensky that President Trump was looking forward to meeting him the following week at the United Nations General Assembly in New York.
Williams said that Pence had not provided Zelensky with any specific guidance on what to say to Trump during their upcoming meeting, but did refer to Ukrainian corruption in general terms. The vice president said Trump “would be eager to hear about Zelensky’s progress” on Ukraine’s anti-corruption reforms.
A White House readout of the call stated “The Vice President commended President Zelensky’s administration for its bold action to tackle corruption through legislative reforms, and offered full U.S. support for those efforts.”
Pence didn’t go into specifics, but he did discuss corruption. This is key: Several Trump administration officials have testified in depositions that “corruption” was code for the specific investigations that the president had mentioned in his July 25 call.
Tuesday’s surprise announcement that the Pence-Zelensky phone call was now a secret and it couldn’t even be discussed in a public session of Congress lends credence that testimony.
“In other words, no pressure”
The decision to classify the September 18th phone call also raises the question of whether Vice President Pence played a role in something that unfolded when Presidents Zelensky and Trump met September 25 in New York.
Trump and Zelensky’s meeting in New York came on the heels of Trump’s release of a transcript of the July 25 phone call between the two men that is now at the center of the House impeachment inquiry.
During a joint news conference in New York, an uncomfortable-looking Zelenskyy was asked whether he felt pressure during the call with Trump.
“It was normal,” the Ukrainian leader replied. “We spoke about many things. And I — so I think, and you read it, that nobody pushed — pushed me.”
Trump jumped in to state, “In other words, no pressure.”
With Pence classifying his call, I can’t help but wonder whether this was another “favor” the White House had asked of Zelensky. Had Pence’s mentions of “corruption” and the fact that the aid was being released sent some signal in his call that the New York meeting was important to the president?
We do know that Pence did play a role in Trump’s efforts to coerce Ukraine into serving up an investigation that would help him politically, as Williams’ testimony Tuesday showed.
In May, Trump “decided” that Pence would not attend Zelensky’s inauguration, even though the vice president had already accepted the invitation, Williams told the House.
The Warsaw Meeting
On September 1, Pence and Zelensky met in Poland at a commemoration of World War II.
Great meeting with President Zelensky of Ukraine today to discuss security, energy, economic growth and progress of his reform agenda. Under the leadership of President @realDonaldTrump, the relationship between Ukraine & the US has never been stronger! pic.twitter.com/nn5UMVM0qZ
— Vice President Mike Pence (@VP) September 1, 2019
Update: On Wednesday, Ambassador Gordon Sondland testified that he briefed Pence about the meeting and the issue of investigations.
“I mentioned to Vice President Pence before the meetings with the Ukrainians that I had concerns that the delay in aid had become tied to the issue of investigations,” Sondland said.
Pence knew what he meant. Sondland agreed that Pence did not ask “Gordon, what are you talking about?’ or “What investigations?’
Pence’s office, now in full damage control mode, denies this.
During that meeting in Warsaw, Zelensky asked the vice president about news articles reporting that $391 million in military aid for Ukraine was being held up. Politico had reported about the hold just a few days earlier. Here’s how Williams described it in her deposition
Once the cameras left the room, the very first question that President Zelensky had was about the status of security assistance. And the VP responded by really expressing our ongoing support for Ukraine, but wanting to hear from President Zelensky, you know, what the status of his reform efforts were that he could then convey back to the President, and also wanting to hear if there was more that European countries could do to support Ukraine.
Deposition of Jennifer Williams
There it is again. Zelensky asks about the security assistance. We support you, Pence responds, but what about the “reform efforts that he could then convey back to the president.” It’s less crude than Trump’s request to “do us a favor” in his July 25 call with Zelensky, but it’s basically the same.
The corruption box is also ticked in the White House readout of the Sept. 1 Pence-Zelensky meeting:
The Vice President met today with President Volodymyr Zelenskyy of Ukraine in Warsaw, Poland, following the Ceremony of the 80th Anniversary of the Outbreak of World War II. The Vice President conveyed the United States’ unwavering support for Ukraine’s territorial integrity and sovereignty. He commended President Zelenskyy for his government’s efforts to introduce bold reform legislation to combat corruption and improve the business climate to encourage foreign investment. The leaders also discussed recent progress toward securing Ukraine’s energy independence.
Williams, who attended the meeting, testified Tuesday in her opening statement, that Zelensky also told Pence that withholding military aid would only help Russia.
“Any signal or sign that U.S. support was wavering would be construed by Russia as potentially an opportunity for them to strengthen their own hand in Ukraine,” Williams said, referring to what the Ukrainian leader told the U.S. vice president.
Williams said that the two men did not discuss specific investigations that Trump had outlined for Zelensky.
“The vice president responded that Ukraine had the United States’ unwavering support and promised to relay their conversation to President Trump that night,” Williams said.
Pence did speak to Trump that night, but Williams said she wasn’t privy to the conversation. The military aid to Ukraine wasn’t unfrozen for another 10 days.
The Problem with “Letting the Voters Decide” about Donald Trump
Nikki Haley, the former South Carolina governor and President Trump’s former UN ambassador, is out with a new book this week. Casting her lot with Trump and his base, Haley says she doesn’t think her former boss has done anything to merit impeachment.
“There’s just nothing impeachable there, and more than that, I think the biggest thing that bothers me is the American people should decide this. Why do we have a bunch of people in Congress making this decision?” Haley told CBS’ Norah O’Donnell.
Ralph Reed, the former executive director of the Christian Coalition who was so fond of telling us during the Clinton impeachment hearings that “character matters,” agrees with Haley.
“Let the voters decide who should be president! This impeachment inquiry is a sham and is an attack on our democracy,” Reed tweeted.
“Let the voters decide” is fast becoming the impeachment battle cry of Trump and his band of loyal Republicans who say the president’s only real “crime” was winning the 2016 election.
But Trump’s defenders have it backwards. Impeachment is the only remedy left for a president who has welcomed, solicited, and extorted foreign interference in our elections. Letting the voters decide is a fine idea when elections are free and fair, but there is simply no guarantee that an election will be free and fair as long as Trump’s name is on the ballot.
The framers of the Constitution worried about foreign interference in elections, which they saw as chief among “the most deadly adversaries of republican government.” But the framers surely never anticipated a president like Trump who would make foreign interference in domestic politics an element of his statecraft.
As the impeachment inquiry in Congress has made painfully clear, the scheme that Trump and his personal lawyer, Rudy Giuliani, cooked up in Ukraine took advantage of a beleaguered country’s need for help battling Russian invaders and sought to use it for Trump’s political advantage back home. Congressionally-appropriated money for Javelin anti-tank weapons was held hostage as the White House tried to coerce Ukraine’s new president into announcing an investigation of a company connected to Joe Biden’s son.
To be sure, politics is a dirty business and candidates have been slinging mud in elections for as long as we’ve had them. But using the power of the presidency to coerce a shaky democracy into investigating the family of a political opponent is so breathtakingly corrupt that it manages to undermine American democracy, damage the rule of law, weaken a U.S. ally, and undermine our national security all at the same time.
The cry of “let the voters decide” signals a retreat to safer ground from the earlier, now abandoned position that no such quid pro quo occurred. An anonymous whistleblower followed by a parade of current and former members of the administration who defied the White House told Congress a sordid story about the administration’s shady goings-on in Ukraine. That led Gordon Sondland, a hotelier who serves as Trump’s ambassador to the European Union, to “refresh” his recollection and concede, contrary to his earlier denials, that not only was there an ultimatum given to Ukraine, but he was the one who had delivered it.
Letting the voters decide might be a plausible if Ukraine were the only instance of foreign interference in a Trump election, but it isn’t. Russia interfered in the 2016 election in what Special Counsel Robert Mueller called a “sweeping and systematic fashion” to help elect Trump, and the campaign welcomed some offers of Russian assistance, such as the June 2016 Trump Tower meeting with a Russian attorney whose offer of dirt on Hillary Clinton was described as “part of Russia and its government’s support for Mr. Trump.”
Not much has changed. Offers of help from abroad were still welcome in the Trump campaign, even after Special Counsel Robert Mueller sent Trump’s campaign chairman, his lawyer and a campaign aide to prison for lying about Russia. The president told ABC News’s George Stephanopoulos in June that there was nothing wrong with accepting dirt from foreign governments. “It’s not an interference, they have information — I think I’d take it,” Trump said — a statement that was noted by the anonymous whistleblower in his complaint laying out the details of the president’s efforts to shake down Ukraine.
The trial of Roger Stone, Trump’s longtime political advisor, is a reminder of the lengths the Trump campaign was willing to go in order to benefit from Russian interference in the 2016 election. As early as April 2016, Stone was informing the Trump campaign of upcoming Wikileaks email dumps of emails stolen from the Democratic Party by Russian intelligence. Prosecutors said that Stone repeatedly lied to Congress about his contacts with Wikileaks because “the truth looked bad for the Trump campaign and the truth looked bad for Donald Trump.”
The toxic combination of foreign interference and Trump’s desire to win at all costs also may go a long way to explaining Trump’s strange attraction to tyrants and strongmen like Vladimir Putin. Trump was clearly willing to punish Ukraine because it wasn’t willing to “do us a favor,” as he put it, and help the president politically. Just imagine what Trump would do for a country that did help him win.
As new details emerge, one can’t help but wonder how many other times the Trump White House solicited foreign interference in episodes that we don’t yet know about. How many testimonies collected by Special Counsel Robert Mueller might have been “refreshed” had courageous insiders stood up to Trump’s bullying and blown the whistle? How many witnesses were less than forthcoming because of the intimidation Trump openly directed at those who stood in his way?
In the end, impeachment isn’t about who wins, regardless of what Trump says. It’s about whether Congress believes foreign governments belong in our elections and whether a leader who welcomes help from abroad or tries to extort it is worthy of letting the people cast their votes for him.
Who Is Harry Sargeant III?
As a young journalist, I was taught to write what’s known in the trade as a “nut graf,” a brief summary of what my story was all about.
I regret to inform you that it is beyond my abilities to write a sentence or two that sums up Harry Sargeant III, whose name has surfaced in the congressional impeachment inquiry into Trump and Ukraine.
The best I can do is tell you that it would include the following: Ukraine, President Trump, Rudy Giuliani, CIA, a sex tape, straw donors, prostitutes in a golf cart, “war profiteering,” the CIA, the Jordanian royal family, and overseas bribery allegations.
“Bad news”
Sargeant’s name was mentioned several times in the just-released testimony of Fiona Hill, President Trump’s former top advisor on Russia, who says Sargeant was involved in Giuliani’s Ukraine adventures on behalf of President Trump:
Hill goes on to say she learned that Sergeant was “bad news” after speaking with her colleagues in some organization whose name has been redacted, presumably because it’s related to intelligence or national security. And Sargeant had something to do with Hill’s feeling that the current Ukraine mess is her “worst nightmare.”
Q. Dr. Hill, you sajd in the last segment of your testimony that we’re now living your worst nightmare. Can you unpack that a little bit for us? What do you mean by that?
A Well, I was extremely concerned that whatever it was that Mr. Giuliani was doing might not be legal , especially after, you know, people had raised with me these two gentlemen, Parnas and Fruman. And also they’d mentioned this third individual who, I mean, I guess is actually on the list of names that you had because I didn’t recognize all the others of, Harry Sargeant and when I’d spoken to my colleagues who, you know, were based in Florida, including our director for the Western Hemisphere, and he’d mentioned that these people were notorious and that, you know, they’d been involved in all kinds of strange things in Venezuela and, you know, kind of were just well-known for not being aboveboard. And so my early assumption was that it was pushing particular individuals’ business interests.
Sargeant rarely speaks to reporters, but in a press release he put out last month, the former fighter pilot, oil billionaire, and GOP fundraiser, insisted that he “conducts no business of any kind in the Ukraine and has not visited Ukraine, even as a tourist, in well over a decade.”
Regular meetings with President Trump?
Sargeant was responding to was a report by The Associated Press that placed him inside a plot to install new management at the top of Ukraine’s massive state gas company, Naftogaz, and then steer lucrative contracts to companies controlled by Trump allies.
Also involved in the plan were Igor Fruman and Lev Parnas, two of Rudy Giuliani’s clients who were helping him dig up dirt in Ukraine on Joe Biden and his family. Parnas and Fruman were indicted in Manhattan on campaign-finance violations.
“In early March,” the AP wrote, “Fruman, Parnas and Sargeant were touting a plan to replace Naftogaz CEO Andriy Kobolyev with another senior executive at the company, Andrew Favorov, according to two individuals who spoke to the AP as well as a memorandum about the meeting that was later submitted to the U.S. Embassy in Kyiv, formerly known as Kiev.”
“Sargeant told Favorov that he regularly meets with Trump at Mar-a-Lago and that the gas-sales plan had the president’s full support, according to the two people who said Favorov recounted the discussion to them,” the AP wrote.
Sargeant conceded that he did attend a March 2019 dinner with Favorov, Fruman, and Parnas “to offer his views on the global oil and gas industry.” He denies discussing taking part in any venture in Ukraine. “Attending a single, informal dinner in Houston does not place Mr. Sargeant at the center of any Naftogaz or Ukrainian business plan,” Sargeant’s release states.
And what about his regular meetings with Trump at Mar-a-Lago?
Sargeant concludes his statement with a non-denial denial: “Mr. Sargeant is not a member of Mar-a-Lago and has never met there with Donald Trump since Mr. Trump has been President.”
The Sex Tape
But Ukraine is only the beginning of the intrigues that surround Sargeant, whose life is like something ripped from the pages of a spy novel.
Sargeant currently embroiled in a court case in London that involves “video material of a sexual nature” featuring Sargeant and a “successful businesswoman in a heavily regulated industry that is reputation sensitive,” according to court filings obtained by The Financial Times.
Sargeant has sued his brother, Daniel, for unlawfully obtaining sensitive photos and videos that were stored on a corporate server belonging to Sargeant Marine, a large family-owned asphalt company.
The explicit video found its way into the hands of Daniel Hall, who ran a business tracking down assets for wealthy clients. Hall obtained the sex tape as part of an effort to try and force Sargeant to pay a $28.8 million court judgement he owed to one of his former business partners.
Sargeant Marine’s name surfaced in Brazil’s “Car Wash” for allegedly paying bribes to local government officials, but Harry Sargeant says he had nothing to do with that. He was ousted from the business several years earlier amid a vicious dispute that spawned 14 lawsuits around the country He settled the case and walked away in 2015 with $56 million.
Straw Donors and Prostitutes in a Golf Cart
Harry Sargeant is also a major GOP donor and fund-raiser. Or he used to be.
Sargeant, who is close friends with former Florida Gov. Charlie Crist, donated more than $1.5 million for Florida politicians and the state Republican Party, according to campaign finance records. Sargeant raised more than $500,000 for the 2008 Republican presidential campaign of U.S. Sen. John McCain.
After he was elected governor in 2006, Crist asked Sargeant to become finance chair at the Florida Republican Party.
Sargeant resigned from the post in 2009 shortly before one of his employees was indicted for making a $5,000 illegal “straw donation” to Crist and $50,000 in illegal donations to three candidates running for president: McCain, Rudy Giuliani and Hillary Clinton.
The employee, Ala’a al-Ali, a citizen of both Jordan and the Dominican Republic, was a sales coordinator for Sargeant Marine. He remains a fugitive.
Allegations surfaced about a notorious 2009 men-only party in the Bahamas attended by Sargeant and Crist.
One former GOP official who attended the event testified that he saw a golf cart full of women driven by one of Sargeant’s employees at the event.
“I specifically saw a golf cart with young ladies drive by, the extent of why they were there I did not specifically know,” said the official, Delmar Johnson. “But I could presume they were prostitutes.”
The testimony came in the criminal case against former Florida GOP Party Chairman Jim Greer.
The Jordanian Royal Family
So far this story has mentioned Ukraine, Venezuela and Brazil, but there’s another country where Sargeant has major financial interests: Jordan.
Sargeant had deep ties to the Hashemite Kingdom. In 2007, Sargeant introduced his friend, then-Florida Governor Crist, to the King of Jordan.
Jordan was critical to valuable contracts Sargeant was awarded to supply fuel and oil to with the U.S. military. Not long after U.S.-led forces invaded Iraq, Sargeant emerged quickly set up a business and won a lucrative contract to provide oil, and later, jet fuel, to coalition troops in Iraq. Sargeant hired Marty Martin, formerly a senior CIA operative who ran Alec Station, the unit that hunted Osama bin Laden, for his oil business.
In 2008, not long after he introduced Crist to the King of Jordan, Sargeant was sued by Mohammed Al-Saleh, a member of the Jordanian royal family who is yet another of Sargeant’s disgruntled former business partners.
Al-Saleh, the brother-in-law of the King of Jordan, said he made the whole venture possible by arranging for the Jordanian government to issue a letter authorizing the transport of oil across Jordan.
In a complaint filed in Palm Beach Circuit Court, Al-Saleh claimed that Sargeant had “conspired to swindle” him out of one third of the profits from the Iraq jet fuel contracts. Sargeant, who gave Al-Saleh the nickname of “Crazy Mo,” testified that Al-Saleh tried to blackmail him.
A competitor, Supreme Fuels Trading FZE, filed a separate racketeering lawsuit in federal court claiming that the millions of dollars paid to Al-Saleh and other Jordanian officials were “bribes” meant to ensure that Sargeant’s company was the only bidder on the fuel contracts. (Supreme Fuels won a $5 million judgement against Sargeant.)
Sergeant was ordered to pay $28.8 million to Al-Saleh after a nearly three-week trial in 2011 that was “watched by note-taking men who said they worked for the federal government, included allegations of bribery of top Jordanian officials, shadowy work by a former CIA agent and Congressional claims of war-profiteering,” the Palm Beach Post reported.
“War Profiteering”
By 2008, as the U.S. occupation of Iraq wore on, Sargeant’s Florida company, International Oil Trading Co., had earned profits of $210 million off military fuel deliveries in Iraq.
That eye-popping figure and Sargeant’s connection to GOP straw donors attracted the attention of Congressman Henry Waxman, chairman of the House Committee on Oversight and Government Reform.
In 2008, Congressman Waxman accused Sargeant of overcharging by 36 cents a gallon for jet fuel and engaging in a “reprehensible form of war profiteering.”
Between 2004 and 2010, Sargeant’s company won four contracts for the supply of fuel to U.S. troops in Iraq through Jordan valued at $3.1 billion.
An audit by the Defense Department’s Inspector General, initiated at Waxman’s request, found that the Pentagon paid Sargeant’s company “$160 [million] to $204 million (or 6 to 7 percent) more for fuel than could be supported by price or cost analysis.”
That, however, was not the final word. Sargeant sued the Defense Department and emerged with a settlement for $40 million.
Yet another Department of Defense internal investigation concluded “no fraud vulnerabilities were identified” in his company’s contracts to provide jet fuel in Iraq.
One thing is clear from all this: Where Sargeant goes, trouble follows.
Trump and the Yalta Yacht Club
The port of Yalta on the Black Sea has long been a source of controversy.
Churchill, Roosevelt and Stalin met there in 1945 to discuss what to do with Germany when World War II ended. The Big Three agreed to demand Germany’s unconventional surrender. They also left with a promise form Stalin to allow free elections in Poland and to grant Eastern Europe the right of political self-determination. Stalin, however, wasn’t a man of the word and the result was a divided Europe and decades of Cold War.
On the 50th anniversary of the Yalta Conference, Donald Trump was considering whether to put his mark on the the Black Sea port.
In September of 2005, a Ukrainian cabinet minister announced that Trump was considering a major investment in his country.
Evhen Chervonenko, Ukraine’s minister of transport, announced on Sept. 12th that Trump planned to put $500 million into construction of an exclusive yacht and hotel complex in the Black Sea resort of Yalta. In order to boost tourism, the Yalta yacht club would replace the unsightly Yalta freight port.
The plan called for what Chervonenko called for a “huge condominium” with restaurants and a hotel.
The Yalta deal never happened, but it’s a chapter of the Trump-Russia story that has not gotten the attention it deserves for it weaves together two critical parts of the saga: Felix Sater and Deutsche Bank.
For Chervonenko had not met with Trump, but rather with one of his representatives, Felix Sater.
h/t Susan Simpson
Sater was a violent twice-convicted felon who had gone to prison for stabbing a commodities trader in an ugly bar fight. Born in Russia and raised in the Russian enclave of Brighton Beach, Sater was the son of a Russian mobster convicted of extorting businesses in Brooklyn.
Despite his past, or perhaps because of it, Sater had gotten a job at Bayrock Group LLC, a New York development firm run by Tevfik Arif, a Kazah-born businessman. Bayrock joined forces with Trump to develop Trump SoHo, in lower Manhattan.
Construction on Trump SoHo had not yet begun when Trump granted Sater and Bayrock exclusive rights for one year to develop a Trump International Hotel and Tower in Kiev and Yalta and the rest of the Commonwealth of Independent States, which included Russia, and the former satellite republics in the Soviet Union. So this career criminal journeyed to Ukraine to negotiate a deal for Trump.
Yalta, although rich in history, is not the first place one thinks of for international tourism. Its location in the Russian-speaking Crimean Peninsula made it part of the ongoing tension between Russia and Ukraine that would culminate in Russia’s invasion of Crimea in 2014.
But Sater was obviously deeply connected in Crimea and the Ukraine. He arrived in the Ukraine in September 2005 bearing a letter from Trump that declared that Ukraine was developing rapidly, and was an ideal location for the signature development of Donald J. Trump. Somehow, Sater got Bayrock Group in a 2005 meeting of the executive council of investors of Crimea chaired by the Prime Minister of Crimea, Anatoliy Matviyenko, according to a Sept. 1 press government release.
Much later, Sater would use his Ukrainian connections to help a Ukrainian lawmaker Andrii V. Artemenko deliver a peace proposal for Russian and Ukraine to the White House in February 2017. Michael Cohen, Trump’s consigliere, had met with the two men in New York and delivered the proposal to the office of Michael Flynn, the National Security Adviser. (Interestingly, Cohen had his own business dealings in Ukraine around the time that Sater was pitching developments in Yalta.)
Several other multinational firms were considering massive investments in Ukraine along with the Trump Organization in 2005. These included the National Container Company of Russia, the Ofer Group of Israel, and the Toepfer Group of Germany. The Toepfer Group would later be caught paying millions of dollars in bribes to Ukrainian officials. Russia’s Sberbank and Vneshtorgbank (now VTB) were considering an additional $2 billion in Ukraine for “re-equipment of railways and ports.” Both of these banks were sanctioned by the United States in 2014 following Russia’s invasion of Crimea.
Trump, who called himself a billionaire and regularly inflated his estimates of his net worth (see TrumpNation by Timothy O’Brien), did not have $500 million to invest in Ukraine or anywhere else for that matter.
On Sept. 9th, three days before the announcement of Trump’s “investment” in Yalta, Ukrainian Transport Minister Chervonenko announced that Trump’s favorite lender, Deutsche Bank, had agreed to loan $2 billion to finance improvements to the country’s railways, postal service, and seaports.
Deutsche Bank’s London office is an attractive target for investigators looking into Trump ties to Russia because of the bank’s own sordid ties to Russia.
From 2011 to 2015, Deutsche Bank laundered rubles into dollars (without any reporting requirements) through a practice known as “mirror trades.” The bank allowed its Russian customers to buy Russian blue-chip stocks in Moscow and then quickly execute a sale of the same stocks in London. Deutsche Bank helped Russians transfer an estimated $10 billion out of the country via these mirror trades. US and UK regulators fined the bank a combined $629 million.
Trump’s business in the Ukraine was not yet finished. In February 2006, Donald Trump Jr. and Ivanka Trump paid a visit to the Ukraine. The Trump children met with Viktor Tkachuk, an adviser to the newly elected, West-leaning president of Ukraine, Viktor Yushchenko. They also met with Andrey Zaika head of a newly-formed Ukrainian construction consortium. The meeting with the Trump children, held in Kiev, was not reported in the Ukrainian press until after the Trumps had left the country.
The Yalta deal fizzled, but it’s a remarkable moment in the Trump-Russia story.