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Major scandal brewing involving Trump, Dutch bank and Kazakh fraudsters

Avaaz, the global human rights organisation, has demanded criminal investigations be made into money laundering operations involving Donald Trump’s lawyer, Rudy Guiliani, and his former law firm.

With a big focus on Trump, the complaint seeks to clarify just how much illicit money could have benefitted the US president in what is described by Avaaz as “one of the biggest fraud cases ever… some of these money flows ultimately ended up in the Netherlands” because “Dutch service providers helped to cover up the money laundering acts.”

The flows began in Kazakhstan, where around $10bn was allegedly embezzled by a Kazakh oligarch, Mukhtar Ablyazov, before being wired around the world, via various tax havens and shell companies, including some in the Netherlands. After being invested in real estate the profits were distributed by more shell companies.

There is potential liability for Dutch banks, who may have crossed the line from avoidance to evasion in their role processing the money flows. Avaaz alleges that some of the funds that passed through Dutch firms had done so with the aid of Rudy Guiliani’s former firm, Bracewell & Guiliani, where Rudy Guiliani was a partner until 2016.

Avaaz has put an open call out to prosecutors around the globe to investigate what it sees as a corrupt operation with Trumps fingerprints on it.

The Dutch TV show Zembla ran an investigation last year on Trump and his Russian links, followed by a story on Trump associates and their alleged role in a money laundering operation in the Netherlands.

While Trump acknowledges he has received significant funds from shell companies he insists that everything is above board and legal.

Kazakhstan is still trying to recover the $10bn stolen by and Mukhtar Ablyazov, with court cases in London, Switzerland, New York and LA. The funds were stolen from BTA bank, which had to be nationalised after the scale of the theft became apparent. Assisting with the laundering of the funds was Viktor Khrapunov, former mayor of Almaty. The two suspects are intimately connected: Khrapunov’s son Ilyas is married to Ablyazov’s daughter Madina. Ilyas was also heavily involved in the laundering of Ablyazov’s billions.

While Viktor Khrapunov has been convicted in absentia of corruption, Ablyazov has had various rulings against him in a number of countries, including London’s High Court which estimated his assets at around $5bn. His charge sheets globally include embezzlement, contempt of court and murder.

Trump’s links with Russian oligarchs and various figures from the post-Soviet world stretch back decades. Trump Tower apartments are allegedly home to a number of mobsters, of various nationalities, and are apparently well known to law enforcement.

One of those associated with Trump is Felix Sater, a Russian born criminal who was involved in a number of Trump deals. Yet during the presidential election Trump appeared to deny much knowledge of the man, despite Sater having a business card reading “senior adviser to Donald Trump”, and a number of photos of the two together. In a 2013 deposition he said, “if [Sater] was sitting in the room right now I really wouldn’t know what he looked like.” It is believed Sater is cooperating the Mueller investigations into Trump’s activities.

Sater worked for Bayrock, just one floor below Trump in Trump Towers. Trump SoHo was a joint project, as indeed was Trump’s plans for a Trump Tower in Moscow.

Sater began working with Viktor Khrapinov in 2007. That year, Khrapinov opened a number of mailbox companies in the Netherlands, while Sater also registered a company in the Netherlands, Bayrock B.V. The Khrapinovs are alleged to have used mailbox companies, including Kazbay, to divert their money. Leila Khrapunova used to own a shell company, Helvetic Capital B.V., which was 50% owner of Kazbay while the other 50% was owned by Bayrock B.V., of which Sater owned half.

Sater began working with Ilyas Khrapinov as early as 2008. SDG was the company setup by the Khrapinovs when they fled Kazakhstan, and it was SDG that partnered with Bayrock Group to convert the Hotel Du Parc in Montreux into “ultra-luxury” flats. There is sworn testimony that Ilyas was involved in moving and hiding Ablyazov’s money. And yet Sater invested millions in US real estate for Ilyas. It is known that Ablyazov also used mailbox companies to divert his money, including companies listed in the Netherlands.

One of the deals Sater was involved in was the Trump SoHo hotel tower incident in which millions of dollars found their way into an Icelandic bank under the control of a Russian oligarch. This was an enormous scheme to defraud British and Dutch pension funds, and Trump has acknowledged he was due an 18% cut of the take.

Trump’s connection to the notorious Kazakh fraudsters was laid bare in London’s Financial Times during the 2016 election. Trump engaged in sales of condos that may have breached the Patriot Act, a set of rules drawn up to counter money laundering. Elvira, daughter of Viktor Khrapinov and brother to Ilyas, was wired $5m from Cyprus, where Ablyazov is known to have a number of holdings. Elvira bought three luxury apartments in Trump SoHo and promptly sold them on again, a regular feature of money laundering.

So while there appears to be some difficult questions for Donald Trump to answer, it is also a difficult case for both the EU and the Netherlands. This is just the latest financial scandal to engulf EU banks. It comes at a particularly delicate time, not only for Trump but also for the EU, which is trying to build a banking union despite serious reservations over the anti-money laundering schemes in place across the continent, not least after the Danske bank scandal.

 

 

 

 

 

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