Crime in Progress

by Glenn Simpson;Peter Fritsch;

  CHAPTER TWO: PROJECT BANGOR

  the first GOP debate: Joe Flint, “GOP Debate Draws 24 Million Viewers, Making Cable History as Donald Trump Leads the Race,” Wall Street Journal, August 7, 2015.

  led to a grand jury investigation: “Supplemental Report on the Qualifications of Donald J. Trump,” Report of the Division of Gaming Enforcement to the Casino Control Commission (Trenton, N.J.: State of New Jersey Division of Gaming Enforcement, December 1, 1992).

  “While I was reporting that book”: Wayne Barrett, “Inside Donald Trump’s Empire: Why He Didn’t Run for President in 2012,” Daily Beast, May 26, 2011.

  By Labor Day weekend, Trump had carved out a solid lead: “2016 Republican Presidential Nomination,” Polling Data, May 6, 2015–May 5, 2016, RealClearPolitics.

  top Republican strategists and donors were combining efforts: Nicholas Confessore, “Talk in G.O.P. Turns to a Stop Donald Trump Campaign,” New York Times, September 4, 2015.

  The earliest article, published on B1: Charles V. Bagli, “Real Estate Executive with Hand in Trump Projects Rose from Tangled Past,” New York Times, December 17, 2007.

  Wayne Barrett had also penned a 2011 follow-up: Barrett, “Inside Donald Trump’s Empire.”

  The feds had accused him of large-scale money laundering and stock manipulation involving Italian organized crime: Bagli, “Real Estate Executive.”

  He was Russian-born and grew up in the rough-and-tumble: Petition for Writ of Certiorari, Palmer v. Doe, No. 14-676, U.S. Supreme Court.

  Simpson went back on Amazon and ordered a copy: Salvatore Lauria and David S. Barry, The Scorpion and the Frog: High Times and High Crimes (Beverly Hills, Calif.: New Millennium Press, 2003).

  Salvatore “Sal” Lauria was a co-conspirator and business partner of Felix Sater during the massive Mob on Wall Street scandal of the late 1990s. They were both named in a 2000 press release by Loretta Lynch, then district attorney of the Eastern District of New York, as major cogs in an organized crime racket involving the La Cosa Nostra Mafia family. Lauria and Sater were co-owners of a stock brokerage known as White Rock Partners & Co., which defrauded investors on behalf of the Italian Mafia.

  Lauria’s book is a detailed account of his years perpetrating stock frauds on Wall Street, with various unsavory Russian mobsters. Sater’s name in the text is changed to “Lex Tersa,” but it’s easy to identify him as Sater. The book also contains passages about Mr. Trump. Sater established an office at Trump’s 40 Wall Street building (page 209), among other interactions, such as his actions at a party with Sal and Lex on page 89:

  “We joined Lex and his wife, Lori, a beautiful blonde like Lynn. The two of them attracted the attention of Donald Trump, who apparently was always on the lookout for new possible conquests.

  “Soon, Trump’s bodyguard walked over to speak to Lori and Lynn. ‘Hi,’ he said. ‘You two ladies are gorgeous and my employer, Mr. Trump,’ he nodded back over his shoulder and paused for a moment to allow the dramatic impact to sink in, ‘would like your names and phone numbers.’ ”

  “never really understood who owned Bayrock”: Deposition of Donald J. Trump, Taglieri v. SB Hotel Associates, No. 08-35643 CACE (07), 17th Judicial Circuit Court, Broward County, Florida, November 16, 2011.

  At the Republican debate: Donald Trump, “Republican Presidential Debate,” CNN Live, CNN, September 16, 2015.

  For decades, Trump had shown a starry-eyed fascination with Russia: Michael Oreskes, “Trump Gives a Vague Hint of Candidacy,” New York Times, September 2, 1987.

  Sater also had a business card: Matthew Mosk and Brian Ross, “Memory Lapse? Trump Seeks Distance from ‘Advisor’ with Past Ties to Mafia,” ABC News, December 10, 2015.

  Trump’s legally required candidate financial disclosure forms: All presidential and vice presidential candidates are required to submit financial disclosure reports to the U.S. Federal Election Commission (FEC). The FEC forwards the reports to the U.S. Office of Government Ethics for review. The forms are available to the public at the FEC (http://fec.gov) and the OGE (http://oge.gov). The disclosures should detail to the public any financial holdings, any debt, and any sources of income.

  Trump University, a for-profit, unaccredited real estate training school that had drawn a raft of lawsuits and regulatory scrutiny: Low v. Trump University, No. 17-55635, U.S. District Court, Southern District of California; Cohen v. Trump, No. 13-cv-2519, U.S. District Court, Southern District of California (filed October 18, 2013); Makaeff v. Trump University, No. 3:10-cv-00940, U.S. District Court, Southern District of California.

  There were numerous ongoing fraud cases: Ibid.

  Trump’s $5 billion libel suit: Trump v. O’Brien, No. CAM-L-545-06, Superior Court of New Jersey, 2006.

  Notably, one of Trump’s own witnesses: Ibid.

  The forty-six-story hotel: Jesse Eisinger, Justin Elliott, Andrea Bernstein, and Ilya Marritz, “Ivanka and Donald Trump Jr. Were Close to Being Charged with Felony Fraud,” ProPublica, October 4, 2017.

  The plaintiffs had alleged: Mike McIntire, “Donald Trump Settled a Real Estate Lawsuit, and a Criminal Case Was Closed,” New York Times, April 5, 2016.

  A classic example was Trump’s Fort Lauderdale project, in which Trump initially said he was an investor: Deposition of Donald J. Trump, Abercrombie v. SB Hotel Associates, No. 08-060702, 17th Judicial Circuit Court, Broward County, Fla., November 5, 2013.

  Trump’s criminal ties were explored: Robert O’Harrow Jr., “Trump Swam in Mob-Infested Waters in Early Years as an NYC Developer,” Washington Post, October 16, 2015.

  all of his projects were fabulously successful: As self-reported on Donald Trump’s presidential candidate financial disclosure forms, housed at the FEC.

  Fusion had acquired a set of court documents filed by a former Bayrock executive: Complaint, Kriss v. Bayrock Whitestone, No. 4899, Delaware Court of Chancery, September 15, 2009. Kriss and his lawyers eventually sued Sater and Bayrock in various other jurisdictions, including the Southern District of New York. The sprawling litigation yielded thousands of public documents about the company. Trump was a defendant in various cases against Bayrock.

  FL Group folded shortly afterwards: Eric Pfanner and Julia Werdigier, “Iceland, in a Precarious Position, Takes Drastic Steps to Right Itself,” New York Times, October 7, 2008.

  a proposed Trump Tower in Moscow: Carol D. Leonnig, Tom Hamburger, and Rosalind S. Helderman, “Trump’s Business Sought Deal on a Trump Tower in Moscow While He Ran for President,” Washington Post, August 27, 2017.

  Trump had hired Cohen in 2007 to act as his in-house enforcer: Michael Falcone, “Donald Trump’s Political ‘Pit Bull’: Meet Michael Cohen,” ABC News, April 16, 2011.

  On October 13, 2015: Philip Bump, “The Events That Led to Trump’s Abandoned Moscow Deal and Michael Cohen’s Latest Plea Agreement,” Washington Post, October 29, 2018.

  The Russia coincidences continued to pile up: Gavin Finch and Ambereen Choudhury, “Deutsche Bank Sets Aside $1.3 Billion, Mostly for Russia Probe,” Bloomberg, October 29, 2015.

  Between 2008 and 2014 she: Résumé, Nellie Ohr.

  Fusion had worked to expose the digital manipulation of abortion clinic sting videos: Jackie Calmes, “Planned Parenthood Videos Were Altered, Analysis Finds,” New York Times, August 27, 2015.

  CHAPTER THREE: THE CHARLATAN

  Labor department records showing: Fusion compiled a spreadsheet of publicly available work visa petition data. The data was available online from the Office of Foreign Labor Certification at the U.S. Department of Labor, http://dol.gov.

  Reuters published its own report: Mica Rosenberg, Ryan McNeill, Megan Twohey, and Michelle Conlin, “Exclusive: Donald Trump’s Companies Have Sought Visas to Import at Least 1,100 Workers,” Reuters, August 2, 2015.

  A Trump Taj Mahal casino w
orker: Indictment, United States v. Gomez-Rua, U.S. Department of Justice, November 29, 2013.

  nearly all of his U.S. facilities: Joshua Partlow and David A. Fahrenthold, “At Trump Golf Course, Undocumented Employees Said They Were Sometimes Told to Work Extra Hours Without Pay,” Washington Post, April 30, 2019; Miriam Jordan, “Making President Trump’s Bed: A Housekeeper Without Papers,” New York Times, December 6, 2018; Claudia Uceda, “Exclusive: Trump Vineyard Also Hired Undocumented Workers,” Univision News, May 2, 2019.

  Trump had moved swiftly to demolish: Diduck v. Kaszycki & Sons Contractors, No. 83-cv-6346, U.S. District Court, Southern District of New York.

  illegal labor practices had ended up in court: Massimo Calabresi, “What Donald Trump Knew About Undocumented Workers at His Signature Tower,” Time, August 25, 2015.

  “working off the books”: Testimony of Donald J. Trump, Diduck v. Kaszycki & Sons.

  Danny Sullivan, a mob-linked labor consultant, testified: Dean Baquet, “Trump Says He Didn’t Know He Employed Illegal Aliens,” New York Times, July 13, 1990. Sullivan’s own tangled history with the Mafia, the FBI, and Trump is chronicled in a 1981 FBI 302 report posted on the Smoking Gun on May 19, 1997, “Donald Trump: Worried About OC in AC.” See also Robert O’Harrow Jr., “Trump’s Ties to an Informant and FBI Agent Reveal His Mode of Operation,” Washington Post, September 17, 2016.

  The court ultimately endorsed: Diduck v. Kaszycki & Sons.

  illegal immigrants were among the construction workers: Antonio Olivo, “At Trump Hotel Site, Immigrant Workers Wary,” Washington Post, July 6, 2015.

  the Trump Organization placed the onus: Ibid.

  Bovis and the Trump Organization had a long-standing business relationship: Kerry Burke, Mike Jaccarino, and Tina Moore, “Worker Killed at Trump Construction Site,” New York Daily News, January 15, 2008.

  Trump, of course, wasn’t the only real estate developer in his immediate family: Gabriel Sherman, “The Legacy,” New York, July 10, 2009.

  The two men planned to finance: Jesse Drucker, “Trump Tower Funded by Rich Chinese Who Invest Cash for Visas,” Bloomberg, March 6, 2016.

  Kushner had partnered with a company based in Shanghai: “The Story Behind the Hot Sale of the US Immigration Trump Tower II Project,” China Business Press Release Newswire, December 4, 2013.

  His sister was actively marketing the scheme: Emily Rauhala and William Wan, “In a Beijing Ballroom, Kushner Family Pushes $500,000 ‘Investor Visa’ to Wealthy Chinese,” Washington Post, May 6, 2017.

  “has called for a revamping”: Drucker, “Trump Tower Funded by Rich Chinese.”

  “People that have come into our country illegally”: Donald Trump, “Republican Presidential Debate,” CNN Live, CNN, December 15, 2015.

  The glaring contradiction: Charles V. Bagli and Megan Twohey, “Donald Trump to Foreign Workers for Florida Club: You’re Hired,” New York Times, February 25, 2016.

  The confidential thirty-six-page report: “Supplemental Report on the Qualifications of Donald J. Trump,” Report of the Division of Gaming Enforcement to the Casino Control Commission (Trenton, N.J.: State of New Jersey Division of Gaming Enforcement, December 1, 1992).

  One section of the report was devoted to Trump’s relationship to convicted narcotics trafficker Joseph Weichselbaum: Ibid., 3.

  Trump had personally leased one of his own apartments to him: Ibid.

  Another disturbing section: Ibid., 6.

  “behind-the-scenes”: Wayne Barrett, Trump: The Deals and the Downfall (New York: HarperCollins, 1992), 236.

  Trump instructed McGahn to broker: Report of the Division of Gaming Enforcement, 6.

  McGahn reportedly had a paralegal from his firm purchase the plot from Philly gangster Salvatore Testa: Sal Testa is the son of mob boss Phil “the Chicken Man” Testa, a Scarfo family associate. McGahn’s nephew Donald F. McGahn II later became the Trump campaign’s lawyer and President Trump’s first White House counsel. See Ben Terris, “Trump’s Own Beltway Establishment Guy: The Curious Journey of Don McGahn,” Washington Post, April 11, 2016.

  McGahn was already a mover and shaker: Wayne King, “A City with a Big Stake in Trump, the Debtor,” New York Times, June 22, 1990.

  was once the subject of a state investigation: Iver Peterson, “Patrick T. McGahn Jr., 72, Lawyer for Casinos,” New York Times, August 3, 2000.

  In 1991, Trump was fined: State of New Jersey Division of Gaming Enforcement v. Trump Plaza Associates, Opinion Docket No. 90-343, New Jersey Casino Control Commission, November 20, 1991.

  The Trump-LiButti relationship would be chronicled: Michael Isikoff, “Video Shows Trump with Mob Figure He Denied Knowing,” Yahoo News, November 2, 2016.

  Trump had been beset by allegations: Robert O’Harrow Jr., “Trump Swam in Mob-Infested Waters in Early Years as an NYC Developer,” Washington Post, October 16, 2015.

  The firm’s principals included Sater, who claimed to have co-founded Bayrock: Felix Sater’s LinkedIn profile, accessed November 9, 2015.

  described as the company’s majority owner: Verified Complaint, Kriss v. Bayrock Group, No. 10-cv-03959, U.S. District Court, Southern District of New York, May 10, 2010, 7.

  it was a criminal enterprise used for money laundering and tax evasion: Ibid.

  While Trump was trying to distance himself: Greg B. Smith, “Trump’s Inn Trouble, SoHo Hotel Firm Cited in Worker Deaths, the Donald Denies Ties to Concrete Catastrophes,” New York Daily News, July 16, 2015; “Donald Trump May Have Reviewed Construction Contracts for Trump SoHo—Where Worker Fell to His Death,” New York Daily News, July 26, 2015.

  New York’s so-called Martin Act: The Martin Act, passed in 1921, is a law specific to New York State. It has been used to prosecute false statements by members of the financial industry. The law very simply can apply to “all deceitful practices contrary to the plain rules of common honesty,” making it one of the most stringent fraud laws in the country.

  For more information on the Martin Act, see District Attorneys Association of New York, “New York State White Collar Crime Task Force Issues Sweeping Recommendations for Modernizing Antiquated Fraud and Corruption Laws,” press release, September 24, 2013; Nicholas Thompson, “The Sword of Spitzer,” Legal Affairs, May/June 2004; and David Voreacos, “The Martin Act,” Bloomberg, November 10, 2015.

  His father was a convicted extortionist: Petition for Writ of Certiorari, Palmer v. Doe, No. 14-676, U.S. Supreme Court, January 12, 2015.

  In 1991, Felix got into a bar fight: He was convicted in 1993 and served a year in prison. Charles V. Bagli, “Real Estate Executive with Hand in Trump Projects Rose from Tangled Past,” New York Times, December 17, 2007.

  In 1998, he was charged: Information Sheet, United States v. Sater, No. 98 CR 1101, U.S. District Court, Eastern District of New York.

  He had faced up to twenty years’ imprisonment: Cooperation Agreement, United States v. Sater, No. 98 CR 1101, U.S. District Court, Eastern District of New York.

  included attempting to buy missiles: See Bagli, “Real Estate Executive,” and Petition for Writ of Certiorari, Palmer v. Doe, No. 14-676, U.S. Supreme Court.

  had an intimate role in the Trump organization: Felix Sater’s profile on LinkedIn and his website, http://felixsaterweb.com, which can be viewed via http://www.web.archive.org.

  a December 2007 New York Times article: Bagli, “Real Estate Executive.”

  Trump took his name off the project: Ryan Yousefi, “Failed Fort Lauderdale Beach Trump Project Will Finally Open as Conrad Hotel,” New Times Broward Palm Beach, October 3, 2014.

  Arif was arrested in Turkey: Rich Schapiro, “Donald Trump Associate Tevfik Arif Prostitution Ring Bust: Cops Caught Businessmen in Act—Report,” New York Daily News, October 1, 2010.

  Among the others arrested: Benjamin Harvey, “
Bayrock’s Arif Detained in Turkish Vice Raid on Yacht,” Bloomberg, October 1, 2010.

  she had traveled to Kazakhstan: Ivanka Trump, The Trump Card: Playing to Win in Work and Life (New York: Simon & Schuster, 2010).

  “who had access to cash accounts”: Verified complaint, Kriss v. Bayrock Group.

  Trump praised Arif’s “international connections”: Deposition of Donald J. Trump, Trump v. O’Brien, Superior Court of New Jersey, December 19, 2007.

  “Tevfik is my friend!”: Bozena Rynska, “Counted Stars,” Izvestia, June 20, 2005.

  The suits were brought by condominium purchasers: Plaintiff’s Motion for Leave to Amend, Taglieri v. SB Hotel Associates, 17th Judicial Circuit Court, Broward County, Florida, December 20, 2013.

  “We never knew that”: Bagli, “Real Estate Executive.”

  Trump had been deposed: Deposition of Donald J. Trump, Abercrombie v. SB Hotel Associates, Nos. 08-060702 and 09-01853, 17th Judicial Circuit Court, Broward County, Florida, November 5, 2013.

  a story on Trump’s dubious denials ran on Good Morning America: Matthew Mosk and Brian Ross, “Memory Lapse? Trump Seeks Distance from ‘Advisor’ with Past Ties to Mafia,” ABC News, December 10, 2015.

  “I will get along—I think—with Putin”: Donald Trump, “Republican Presidential Debate,” CNN Live, CNN, September 16, 2015.

  “I think I would get along very well with him”: Donald Trump, interview by Erin Burnett, Erin Burnett OutFront, CNN, September 28, 2015.

  in a November 10 debate: Donald Trump, “Republican Presidential Debate,” Fox Business Network, November 10, 2015.

  Trump and Putin were never on 60 Minutes together: Donald Trump and Vladimir Putin, 60 Minutes, CBS, September 27, 2015.

  he had donated $5,000 to RT: Ohr brought the articles to Fusion’s attention. The articles had proliferated on various Russian-language websites, but Fusion was never able to verify the origin of the articles.

  Trump said that Russians were his favorite customers: Alexander Sirotin, “Breakfast at Trump,” Chayka (Seagull) magazine, September 1, 2008.