Corruption is Everywhere > Trump Org. guilty of tax evasion; Ramaphosa facing impeachment; Glencore Settles another Corruption case

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Trump Organization found guilty of years-long tax fraud scheme

By Luc Cohen and Karen Freifeld  Reuters

Posted December 6, 2022 1:03 pm

Global National: Dec. 3

Donald Trump’s real estate company was convicted on Tuesday of carrying out a more-than 15-year-long criminal scheme to defraud tax authorities, adding to the legal woes facing the former U.S. president as he campaigns for the office again in 2024.

The Trump Organization – which operates hotels, golf courses, and other real estate around the world – faces fines over the conviction. The exact amount will be determined by the judge overseeing the trial in New York State court at a later date.

The company pleaded not guilty. Trump himself was not charged in the case.

While the fine is not expected to be material for a company of the Trump Organization’s size, the conviction by a jury could complicate its ability to do business by spooking lenders and partners.

The case centered on charges that the company paid personal expenses like free rent and car leases for top executives including former chief financial officer Allen Weisselberg without reporting the income, and paid them bonuses as if they were independent contractors.

“The smorgasbord of benefits is designed to keep its top executives happy and loyal,” prosecutor Joshua Steinglass told jurors during his closing argument on Friday.

The Trump Organization separately faces a fraud lawsuit brought by New York state Attorney General Letitia James.

Trump himself is being investigated by the U.S. Department of Justice over his handling of sensitive government documents after he left office in January 2021 and attempts to overturn the November 2020 election, which he lost to Democrat Joe Biden.

Weisselberg, 75, testified as the government’s star witness as part of a plea deal with prosecutors that will allow him to spend no more than five months in jail.

The Trump Organization argued that Weisselberg carried out the scheme to benefit himself. He is on paid leave from the company and testified that he received more than $1 million in salary and bonus payments this year.

“The question here is not whether as a byproduct the company saved some money,” Susan Necheles, a defense lawyer, said in her closing argument on Thursday. “(Weisselberg’s) intent was to benefit himself, not the company.”

Trump wrote on his Truth Social platform on Nov. 19 that his family got “no economic gain from the acts done by the executive.”

Although, keeping top executives might be considered gain.

Republican Trump, who on Nov. 15 announced his third campaign for the presidency, has called the probe a politically motivated “witch hunt.” Both Manhattan District Attorney Alvin Bragg and his predecessor who brought the charges, Cyrus Vance, are Democrats.

Shouldn't DAs be non-political?

Weisselberg, who pleaded guilty in August to concealing $1.76 million in income from tax authorities, testified that Trump himself signed the Christmas bonus checks and personally paid hundreds of thousands of dollars in private school tuition for Weisselberg’s grandchildren.

He also said Trump’s two sons – who took over the company’s operations in 2017 after Trump became president – gave him a raise after they knew about his tax dodge scheme.

“The whole narrative that Donald Trump was blissfully ignorant is just not real,” Steinglass said.

The Trump Organization also sought to argue that Donald Bender, an outside accountant, should have caught and blown the whistle on Weisselberg’s fraud.

The company called Bender as its main witness, but his testimony appeared to backfire when he said he trusted that the information Weisselberg gave him was accurate and that he was under no obligation to investigate further.

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President of South Africa faces impeachment over 'Farmgate' scandal

By A.L. Lee

   

South African President Cyril Ramaphosa denies any wrongdoing in what has become known as the “Farmgate” scandal, claiming that nearly $600,000 in cash found stuffed in sofa cushions at his Phala Phala farm in the country's northeast were proceeds from buffalo sales. File photo by Pete Marovich/UPI | License Photo

Dec. 1 (UPI) -- South African President Cyril Ramaphosa faces impeachment after an independent investigation determined he allegedly tried to cover up a $4 million robbery at his farm two years ago in an effort to abscond with the loot.

Ramaphosa denies any wrongdoing in what has become known as the "Farmgate" scandal, claiming that nearly $600,000 in cash found stuffed in sofa cushions at his Phala Phala farm in the country's northeast were proceeds from buffalo sales.

He has not faced any criminal charges since the scandal first emerged back in June.

However, the extensive report released Wednesday by an independent South African investigative committee accuses Ramaphosa of concealing the $4 million heist and then pressuring the Namibian president into silencing the suspects following their arrests.

Ramaphosa "abused his position as head of state to have the matter investigated and seeking the assistance of the Namibian president to apprehend a suspect," the committee said in the report.

The case first came to light this past summer after the country's former spy chief, Arthur Fraser, accused Ramaphosa of working behind the scenes to conceal the caper.

At the time, Fraser publicly speculated whether the loot had come from money-laundering instead of buffalo sales, and accused the president of kidnapping and bribery.

Well after the fact, Ramaphosa finally acknowledged that the robbery happened but said the amount stolen was far less than $4 million.

"I did not 'hunt' for the perpetrators of the theft, as alleged, nor did I give any instructions for this to take place," the president wrote in a submission to the panel's report.

The findings of the investigation have been handed over to the country's parliament, which will convene early next week to decide whether to launch official impeachment proceedings.

In order to forcibly remove Ramaphosa from office, the body will have to find the president guilty of misconduct, abuse of power, and violating the constitution that he helped draft with Nelson Mandela in the early 1990s.

Leaders of Ramaphosa's party, the African National Congress, were expected to meet later Thursday to discuss the details of the report ahead of a larger political convention to decide whether the incumbent should seek a second term in 2024.

Back in Cape Town, Ramaphosa canceled an appearance before parliament and rescheduled meetings with provincial lawmakers to give himself time to pore over the findings while opposition leaders made public calls for him to step down.

"I have endeavored, throughout my tenure as president, not only to abide by my oath but to set an example of respect for the Constitution, for its institutions, for due process and the law," Ramaphosa said in a statement on Wednesday.

"I categorically deny that I have violated this oath in any way, and I similarly deny that I am guilty of any of the allegations made against me."

In the report, the panel specifically seeks an explanation for $580,000 found hidden inside a sofa that was never reported to authorities. The report further alleges that the cattle Ramaphosa claimed to have sold were still grazing on his farm.

"We think that the president has a case to answer on the origin of the foreign currency that was stolen, as well as the underlying transaction for it," the committee states in the report.

Ramaphosa was elected in 2018 and rose to power on an anti-corruption platform following the controversial tenure of his predecessor Jacob Zuma, who was sentenced last year to 15 months in prison for failing to appear for his criminal corruption trial -- a case that is still pending.

Swiss mining company Glencore settles corruption case in Congo

By Adam Schrader

   

Demonstrators participate in a union protest in front of the main entrance of the casino in Zug, Switzerland, in 2018 on the occasion of the Glencore annual meeting. File Photo by Alexandra Wey/EPA-EFE

Dec. 5 (UPI) -- Glencore, a mining company based in Switzerland, settled a corruption case in the Democratic Republic of Congo on Monday for $180 million.

The company announced in a news release that the settlement covers all current and future claims from alleged corruption between 2007 and 2018.

"This includes activities in certain group businesses that have been the subject of various investigations by, amongst others, the U.S. Department of Justice and the DRC's National Financial Intelligence Unit and Ministry of Justice," Glencore said in the statement.

The U.S. Justice Department in May said in a statement that Glencore had admitted to corruption by conspiring to pay $27.5 million to illegally secure business advantages in the DRC.

"The rule of law requires that there not be one rule for the powerful and another for the powerless; one rule for the rich and another for the poor," U.S. Attorney General Merrick Garland said at the time.

"The Justice Department will continue to bring to bear its resources on these types of cases, no matter the company and no matter the individual."

The settlement announced Monday marks the latest in a series of corruption cases in which Glencore has agreed to pay more than $1.6 billion in fines, the BBC reported.

More than $1.1 billion of those fines came after the company pleaded guilty in coordinated resolutions in the United States, Britain and Brazil.

Under the settlement reached Monday, Glencore "committed to continue to implement in its resolution" with the U.S. Justice Department.

Glencore's assets in DRC include the copper-cobalt mine Mutanda and a controlling stake in the Kamoto Copper Co., one of the world's largest copper and cobalt producers.

"Glencore is a longstanding investor in the DRC and is pleased to have reached this agreement to address the consequences of its past conduct," Glencore Chairman Kalidas Madhavpeddi said.

"Glencore has actively promoted its ethics and compliance program in the DRC in recent years and looks forward to continuing to work with the DRC authorities and other stakeholders to facilitate good governance and ethical business practices in the country."

An African country with ethical business practices.... Sure.

Corruption is Everywhere > Ex-PM Morrison's Secret Self-Appointments; Man with 9K income buy $11mn Mansion; Trump Org man sentenced

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Former Australia PM Morrison faces calls to resign over secret self-appointments

By Clyde Hughes

Scott Morrison, Australia's PM from 2018 to last May, offered an apology on Tuesday and said the self-appointments were made only to use in case of emergency due to the COVID-19 pandemic. File Photo by Lukas Coch/EPA-EFE

Aug. 16 (UPI) -- Former Australian Prime Minister Scott Morrison is facing calls for him to resign from parliament after revelations that while in power he secretly appointed himself to five ministries, often without the knowledge of those running the departments.

Prime Minister Anthony Albanese said on Tuesday that he's waiting for legal advice on what can be done now that Morrison is no longer in the leadership post, and how to prevent the same thing from happening again.

The unannounced self-appointments secretly gave Morrison final decision-making power in the ministries of health, finance, treasury, home affairs and industry.

Morrison, who was Australia's PM from 2018 to last May, offered an apology on Tuesday and said the self-appointments were made only to use in case of emergency due to the COVID-19 pandemic.

"These were extraordinary times and they required extraordinary measures to respond," Morrison said in a post to Facebook. "Our government's overriding objective was to save lives and livelihoods, which we achieved."

"To achieve this, we needed to ensure continuity of government and robust administrative arrangements to deal with the unexpected in what was a period of constant uncertainty during the nation's biggest crisis outside of wartime," he added.

Peter Dutton, head of Morrison's Liberal Party, has defended the former prime minister and accused of Albanese -- leader of the opposition Australian Labor Party -- of trying to score political points on the issue.

Karen Andrews, who was home affairs minister under Morrison, said that she was blindsided by the revelations and has called for his resignation. He represents the division of Cook in Australian Parliament.

"I had absolutely no knowledge and was not told by the [prime minister, the prime minister's office] nor the department secretary," Andrews said according to the Australian Broadcasting Corp. "This undermines the integrity of government. I think that Scott Morrison needs to resign, and he needs to leave parliament."

Tax agency obtains 'jeopardy order' for debt from

Downton Abbey-loving billionaire

Mingfei Zhao paid $11 million for iconic Vancouver mansion in same year

he declared income of $9K

Jason Proctor · 

CBC News · 

Posted: Aug 17, 2022 4:00 AM PT

Billionaire Mingfei Zhao spoke with the CBC in 2016 about his plans to restore an iconic Vancouver mansion to its former glory. The Canada Revenue Agency has applied for an order to seize money from the sale of the home. (Chris Corday/CBC)

Canada's tax agency has obtained an order to seize debts owed by a Chinese billionaire whose love of Downton Abbey inspired him to pay more than $11 million for an iconic Vancouver mansion in the same year he claimed income of just $9,424.

According to a federal court judgment issued last month, the Canada Revenue Agency sought the so-called "jeopardy order" to collect $770,710 against the future sale of Mingfei Zhao's home because the 64-year-old has left Canada and appears to be in the process of trying to sell the only asset he has left in this country.

The new 'Earl' of Shaughnessy breathes life into historic home

Zhao bought the 14,000-square foot Tudor-style property in 2014 to much fanfare, vowing to return the building to its original glory a century earlier when "the Rosemary" — named after the daughter of a liquor tycoon — was considered the grandest home ever built in Vancouver.

But according to the court documents, Zhao declared income of less than $10,000 in 2014 and $38,161 in 2015 — amounts CRA auditors concluded were "not sufficient" to support his purchase of real estate and monthly mortgage payments of $8,699.

"Lifestyle does not match reported income," a CRA auditor claimed in a lengthy affidavit obtained by the CBC.

The tax agency reassessed Zhao's income for the two years in question at a combined $1.28 million — levelling a claim against him for unpaid income tax, which has risen to more than $770,000 with interest and penalties.

'I was watching Downton Abbey at the time'

Zhao spoke with the CBC in 2016 about his plans for the Rosemary.

He described himself as a retired property developer from Beijing who made his first fortune in flax and grains before moving on to real estate. Zhao immigrated to Canada in September 2014, and his tax returns identify him as divorced.

The Rosemary, built in 1918, was named after the daughter of the liquor tycoon who built it.

New owner Mingfei Zhao bought the property for $11 million in 2014.

(Leonard Frank/Vancouver Public Library)

Zhao told CBC he was sinking millions into an upgrade of the 12-bedroom, 12-bathroom mansion, which features an arched bridge connecting the main building to a carriage house.

Speaking through a Mandarin translator, Zhao said he fell in love with the Rosemary at first sight.

"I liked it because I was watching Downton Abbey at the time," Zhao said.

The billionaire said he was determined to shatter the stereotype that people from China are serial destroyers of older properties: "I want to protect and recover this house to make it stand here another 100 years."

'He had started a new family in Europe'

Zhao has filed notices of objection to fight the tax penalty assessed by the CRA, which would normally mean that the agency would not be able to come for his money until after an appeal has been determined.

But the federal Income Tax Act allows the CRA to ask a judge to order payment when "the collection of all or any part of an amount assessed in respect of a taxpayer would be jeopardized by a delay in the collection of that amount."

The court file includes more than 2,000 pages of documents detailing attempts to nail down Zhao's bank account balances, his unreported worldwide income and his whereabouts.

At one point, he also owned another multi-million dollar home as well as a Bentley, a Rolls Royce, a Mercedes and a Range Rover. But as of last June, he was only registered as the owner of the Rosemary and the Range Rover.

Last month, records showed Zhao no longer had a Canadian cellphone account.

In March, the CRA also claimed to have "uncovered" a Globe and Mail article from nearly two years earlier "in which it stated that Mr. Zhao no longer lived in Vancouver and that he had started a new family in Europe."

'The optics don't look good'

The documents detail discussions between auditor Dale Gonwick and one of Zhao's legal representatives — who later advised that no one would appear for Zhao at the court hearing.

"I asked if there were any items he knew of that might help balance the 'not a Jeopardy' side of the equation, because from what I could see, I would have to refer this up the line as a danger of loss issue," Gonwick wrote.

The Rosemary was purchased for $11 million in 2014 and is now on sale for $19 million. It takes a fish-eye lens to properly capture the size of the property. (Chris Corday/CBC)

Zhao's representative pointed out that the Rosemary — now listed at $19 million — had been on the market for more than a year with no buyers but "admitted that 'the optics don't look good.'"

Judges have issued jeopardy orders in previous cases where large sums of cash have been found in the trunk of an automobile or in the pocket of a taxpayer's housecoat.

Federal Court Justice Cecily Strickland concluded that, while Zhao's "conduct of his affairs" may not fit with that kind of behaviour, his reported income raised questions given his lifestyle.

"Accordingly, the nature of the assessment raises a reasonable apprehension that Mr. Zhao had not been conducting his affairs in 'an orthodox fashion' and that it would be difficult to trace or recover the funds for the tax debt," she concluded.

Zhao could not be reached for comment.

Trump Organization official Allen Weisselberg pleads guilty

to tax fraud, grand larceny

CFO may be called to testify when the Trump Organization goes on trial

The Associated Press · 

Posted: Aug 18, 2022 11:21 AM ET 

The Trump Organization's former chief financial officer Allen Weisselberg arrives at court on Thursday in New York. Weisselberg pleaded guilty to charges that he accepted more than $1.7 million in off-the-books compensation from the

former president's company over several years, including untaxed perks like rent, car payments and school tuition.

(Yuki Iwamura/The Associated Press)

A top executive at former U.S. president Donald Trump's family business pleaded guilty Thursday to evading taxes in a deal that could potentially make him a star witness against the company at a fall trial.

Trump Organization chief financial officer Allen Weisselberg pleaded guilty to all 15 of the charges he faced in the case, which included charges of tax fraud, grand larceny and falsifying business records. He was accused of dodging taxes on lavish fringe benefits he got from the company, including lease payments for a luxury car, rent for a Manhattan apartment and private school tuition for his grandchildren.

Seen as one of Trump's most loyal business associates, Weisselberg was arrested in July 2021. He is the only person to face criminal charges so far in the Manhattan district attorney's long-running investigation of the company's business practices.

Judge Juan Manuel Merchan agreed to sentence Weisselberg, 75, to five months incarceration and five years probation at New York City's Rikers Island jail complex, although he will be eligible for release much earlier if he behaves well behind bars. The judge said Weisselberg will have to pay nearly $2 million US in taxes, penalties and interest. 

Weisselberg said nothing as he left court, offering no reply when a journalist asked him whether he had any message for Trump.

Weisselberg's lawyer, Nicholas Gravante Jr., said his client pleaded guilty "to put an end to this case and the years-long legal and personal nightmares it has caused for him and his family."

"We are glad to have this behind him," the lawyer said.

50-year relationship with company

The plea bargain also requires Weisselberg to testify truthfully as a prosecution witness when the Trump Organization goes on trial in October on related charges. The company is accused of helping Weisselberg and other executives avoid income taxes by failing to accurately report their full compensation to the government.

Trump himself is not charged in the case.

Testimony by Weisselberg could potentially weaken the Trump Organization's defence. If convicted, the company could face fines or potentially be placed on probation and be forced to change certain business practices.

Reaction from the Manhattan DA:

Weisselberg's professional relationship with Trump and Trump's late father, Fred, dates back to 1973.

"Today Allen Weisselberg admitted in Court that he used his position at the Trump Organization to bilk taxpayers and enrich himself," Manhattan District Attorney Alvin Bragg said in a lengthy statement.

"We look forward to proving our case in court against the Trump Organization," said Bragg.

The Real Bill Browder Story (part one): What US/UK Media Won’t Tell You About Billionaire Lobbyist’s Dubious Narrative

FILE PHOTO © Getty Images via AFP / GETTY IMAGES NORTH AMERICA / Drew Angerer

By John Ryan, Ph.D. – Retired Professor of Geography and Senior Scholar, University of Winnipeg, Canada

If anyone has proven the adage that “a lie can travel halfway around the world while the truth is still putting on it shoes,” it’s Bill Browder. The mega-rich vulture capitalist has been spinning a yarn for years.

Intriguingly, after Germany’s leading news magazine kiboshed his fake narrative, Anglo-American media ignored the revelations.

Browder’s narrative suits the US/UK establishment as it provides a convenient excuse to sanction Russia, but the story has more holes than Swiss cheese.

The billionaire vulture capitalist has been a figure of some prominence on the world scene for the past decade. A few months back, (2nd link below) Der Spiegel published a major exposé on him and the case of Sergei Magnitsky, but the US/UK mainstream media failed to follow it up and so, aside from Germany, few people are aware of Browder’s background.

Who's Bill Browder and Why Does He Want to Bring Down Putin?

Bill Browder - Hero or Villain? Where's the Truth?

The Case of Sergei Magnitsky - Questions Cloud Story Behind U.S. Sanctions

Browder had gone to Moscow in 1996 to take advantage of the privatization of state companies by then-Russian President Boris Yeltsin. Browder founded Hermitage Capital Management, a Moscow investment firm registered in offshore Guernsey in the Channel Islands. For a time, it was the largest foreign investor in Russian securities. Hermitage Capital Management was rated as extremely successful after earning almost 3,000 percent in its operations between 1996 and December 2007.

During the corrupt Boris Yeltsin years, with his business partner’s US$25 million, Browder amassed a fortune. Profiting from the large-scale privatizations in Russia from 1996 to 2006, his Hermitage firm eventually grew to $4.5 billion.

When Browder encountered financial difficulties with Russian authorities, he portrayed himself as an anti-corruption activist and became the driving force behind the Magnitsky Act, which resulted in economic sanctions aimed at Russian officials. However, an examination of Browder’s record in Russia and his testimony in court cases reveal contradictions with his statements to the public and Congress, and raises questions about his motives in attacking corruption in Russia.

Although he has claimed that he was an ‘activist shareholder’ and campaigned for Russian companies to adopt Western-style governance, it has been reported that he cleverly destabilized companies he was targeting for takeover. Canadian blogger Mark Chapman has revealed that after Browder would buy a minority share in a company, he would resort to lawsuits against this company through shell companies he controlled. This would destabilize the company with charges of corruption and insolvency. To prevent its collapse, the Russian government would intervene by injecting capital into it, causing its stock to rise—with the result that Browder’s profits would rise exponentially.

Later, through Browder’s Russian-registered subsidiaries, his accountant Magnitsky acquired extra shares in Russian gas companies such as Surgutneftegaz, Rosneft and Gazprom. This procedure enabled Browder’s companies to pay the residential tax rate of 5.5 percent instead of the 35 percent that foreigners would have to pay.

However, the procedure to bypass the Russian presidential decree that banned foreign companies and citizens from purchasing equities in Gazprom was an illegal act. Because of this and other suspected transgressions, Magnitsky was interrogated in 2006 and later in 2008. Initially he was interviewed as a suspect and then as an accused. He was then arrested and charged by Russian prosecutors with two counts of aggravated tax evasion committed in conspiracy with Bill Browder in respect of Dalnyaya Step and Saturn, two of Browder’s shell companies to hold shares that he bought. Unfortunately, in 2009, Magnitsky died in pre-trial detention because of a failure by prison officials to provide prompt medical assistance.

Browder has challenged this account and for years he has maintained that Magnitsky’s arrest and death were a targeted act of revenge by Russian authorities against a heroic anti-corruption activist.

It’s only recently that Browder’s position was challenged by the European Court of Human Rights, which in its ruling on August 27, 2019 concluded that Magnitsky’s “arrest was not arbitrary, and that it was based on reasonable suspicion of his having committed a criminal offence.” And as such, “The Russians had good reason to arrest Sergei Magnitsky for Hermitage tax evasion.”

“The Court observes that the inquiry into alleged tax evasion, resulting in the criminal proceedings against Mr Magnitskiy, started in 2004, long before he complained that prosecuting officials had been involved in fraudulent acts.”

Prior to Magnitsky’s arrest, because of what Russia considered to be questionable activities, Browder had been refused entry to Russia in 2005. However, he did not take lightly his rebuff by the post-Yeltsin Russian government under Vladimir Putin. As succinctly expressed by Professor Halyna Mokrushyna at the University of Ottawa:

[Browder] began to engage in a worldwide campaign against the Russian authorities, accusing them of corruption and violation of human rights. The death of his accountant and auditor Sergei Magnitsky while in prison became the occasion for Browder to launch an international campaign presenting the death as a ruthless silencing of an anti-corruption whistleblower. But the case of Magnitsky is anything but.

Despite Browder’s claims that Magnitsky died as a result of torture and beatings, authentic documents and testimonies show that Magnitsky died because of medical neglect – he was not provided adequate treatment for a gallstone condition. It was negligence typical at that time of prison bureaucracy, not a premeditated killing. Because of the resulting investigation, many high-level functionaries in the prison system were fired or demoted.

For the past 10 years, Browder has maintained that Magnitsky was tortured and murdered by prison guards. Without any verifiable evidence he has asserted that Magnitsky was beaten to death by eight riot guards over 1 hour and 18 minutes. This was never corroborated by anybody, including by autopsy reports. It was even denied by Magnitsky’s mother in a video interview.

Nevertheless, on the basis of his questionable beliefs, he has carried on a campaign to discredit and vilify Russia and its government and leaders.

In addition to the ruling of the European Court of Human Rights, Browder’s basic underlying beliefs and assumptions are being seriously challenged. Very recently, on May 5, 2020, an American investigative journalist, Lucy Komisar, published an article with the heading Forensic photos of Magnitsky show no marks on torso:

On Fault Lines today I revealed that I have obtained never published forensic photos of the body of Sergei Magnitsky, William Browder’s accountant, that show not a mark on his torso. Browder claims he was beaten to death by prison guards. Magnitsky died at 9:30pm Nov 16, 2009, and the photos were taken the next day.

Her later report says:

I noted on the broadcast that though the photos and documents are solid, several dozen U.S. media – both allegedly progressive and mainstream — have refused to publish this information. And if that McCarthyite censorship continues, the result of rampant fear-inducing Russophobia, I will publish it and the evidence on this website.

Despite evidence such as this, till this day Browder maintains that Sergei Magnitsky was beaten to death with rubber batons. It’s this narrative that has attracted the attention of the US Congress, members of parliament, diplomats and human rights activists. To further refute his account, a 2011 analysis by the Physicians for Human Rights International Forensics Program of documents provided by Browder found no evidence he was beaten to death.

In his writings, as supposed evidence, Browder provides links to two untranslated Russian documents. They were compiled immediately after Magnitsky died on November 16, 2009. Recent investigative research has revealed that one of these appears to be a forgery. The first document, D309, states that shortly before Magnitsky’s death: “Handcuffs were used in connection with the threat of committing an act of self-mutilation and suicide, and that the handcuffs were removed after thirty minutes.” To further support this, a forensic review states that while in the prison hospital, “Magnitsky exhibited behavior diagnosed as ‘acute psychosis’ by Dr. A. V. Gaus at which point the doctor ordered Mr. Magnitsky to be restrained with handcuffs.”

The second document, D310, is identically worded to D309 except for a change in part of the preceding sentence. The sentence in D309 has the phrase “special means were” is changed in D310 to “a rubber baton was.”

As such, while D309 is perfectly coherent, in D310 the reference to a rubber baton makes no sense whatsoever, given the title and text it shares with D309. This and other inconsistencies, including signatures on these documents, make it apparent that D310 was copied from D309 and that D310 is a forgery. Furthermore, there is no logical reason for two almost identical reports to have been created, with only a slight difference in one sentence. There is no way of knowing who forged it and when, but this forged document forms a major basis for Browder’s claim that Magnitsky was clubbed to death.

The fact that there is no credible evidence to indicate that Magnitsky was subjected to a baton attack, combined with forensic photos of Magnitsky’s body shortly after death that show no marks on it, provides evidence that appears to repudiate Browder’s decade-long assertions that Magnitsky was viciously murdered while in jail.

With evidence such as this, it repeatedly becomes clear that Browder’s narrative contains mistakes and inconsistencies that distort the overall view of the events leading to Magnitsky’s death.

Despite Magnitsky’s death, the case against him continued in Russia and he was found guilty of corruption in a posthumous trial. Actually, the trial’s main purpose was to investigate alleged fraud by Bill Browder, but to proceed with this they had to include the accountant Magnitsky as well. The Russian court found both of them guilty of fraud. Afterwards, the case against Magnitsky was closed because of his death.

After Browder was refused entry to Russia in November of 2005, he launched a campaign insisting that his departure from Russia resulted from his anti-corruption activities. However, the real reason for the cancellation of his visa that he never mentions is that in 2003, a Russian provincial court had convicted Browder of evading $40 million in taxes. In addition, his illegal purchases of shares in Gazprom through the use of offshore shell companies were reportedly valued at another $30 million, bringing the total figure of tax evasion to $70 million.

It’s after this that the Russian federal government next took up the case and initially went after Magnitsky, the accountant who carried out Browder’s schemes.

But back in the US, Browder portrayed himself as the ultimate truth-teller, and embellished his tale by asserting that Sergei Magnitsky was a whistleblowing “tax lawyer,” rather than one of Browder’s accountants implicated in tax fraud. As his case got more involved, he presented a convoluted explanation that he was not responsible for bogus claims made by his companies. This is indeed an extremely complicated matter and as such only a summary of some of this will be presented.

The essence of the case is that in 2007, three shell companies that had once been owned by Browder were used to claim a $232 million tax refund based on trumped-up financial loses. Browder has stated that the companies were stolen from him, and that in a murky operation organized by a convicted fraudster, they were re-registered in the names of others. There is evidence, however, that Magnitsky and Browder may have been part of this convoluted scheme.

Browder’s main company in Russia was Hermitage Capital Management, and associated with this firm were a large number of shell companies, some in the Russian republic of Kalmykia and some in the British Virgin Islands. A law firm in Moscow, Firestone Duncan, owned by Americans, did the legal work for Browder’s Hermitage. Sergei Magnitsky was one of the accountants for Firestone Duncan and was assigned to work for Hermitage.

An accountant colleague of Magnitsky’s at Firestone Duncan, Konstantin Ponomarev, was interviewed in 2017 by Komisar, who said:

According to Ponomarev, the firm – and Magnitsky — set up an offshore structure that Russian investigators would later say was used for tax evasion and illegal share purchases by Hermitage… the structure helped Browder execute tax-evasion and illegal share purchase schemes.

He said the holdings were layered to conceal ownership: The companies were ‘owned’ by Cyprus shells Glendora and Kone, which, in turn, were ‘owned’ by an HSBC Private Bank Guernsey Ltd trust. Ponomarev said the real owner was Browder’s Hermitage Fund. He said the structure allowed money to move through Cyprus to Guernsey with little or no taxes paid along the way. Profits could get cashed out in Guernsey by investors of the Hermitage Fund and HSBC.

Ponomarev said that in 1996, the firm developed for Browder ‘a strategy of how to buy Gazprom shares in the local market, which was restricted for foreign investors.’

In the course of their investigation, on June 2, 2007, Russian tax investigators raided the offices of Hermitage and Firestone Duncan. They seized Hermitage company documents, computers and corporate stamps and seals. They were looking for evidence to support Russian charges of tax evasion and illegal purchase of shares of Gazprom.

In a statement to US senators on July 27, 2017, Browder stated that Russian Interior Ministry officials “seized all the corporate documents connected to the investment holding companies of the funds that I advised. I didn’t know the purpose of these raids so I hired the smartest Russian lawyer I knew, a 35-year-old named Sergei Magnitsky. I asked Sergei to investigate the purpose of the raids and try to stop whatever illegal plans these officials had.”

Contrary to what Browder claims, Magnitsky had been his accountant for a decade. He had never acted as a lawyer, nor did he have the qualifications to do so. In fact, in 2006, when questioned by Russian investigators, Magnitsky said he was an auditor on contract with Firestone Duncan. In Browder’s testimony before the Senate Judiciary Committee in 2017, he claimed Magnitsky was his lawyer, but in 2015, in his testimony under oath in the US government’s Prevezon case, Browder told a different story, as will now be related.

On Browder’s initiative, in December 2012, he presented documents to the New York District Attorney alleging that a Russian company, Prevezon, had “benefitted from part of the $230 million dollar theft uncovered by Magnitsky and used those funds to buy a number of luxury apartments in Manhattan.” In September 2013, the New York District Attorney’s office filed money-laundering charges against Prevezon. The company hired high-profile New York-based lawyers to defend themselves against the accusations.

As reported by Der Spiegel, Browder would not voluntarily agree to testify in court, so Prevezon’s lawyers sent process servers to present him with a subpoena, which he refused to accept and was caught on video literally running away. In March 2015, the judge in the Prevezon case ruled that Browder would have to give testimony as part of pre-trial discovery. Later, while in court and under oath and confronted with numerous documents, Browder was totally evasive. Lawyer Mark Cymrot spent six hours examining him, beginning with the following exchange:

Cymrot asked: Was Magnitsky a lawyer or a tax expert?

He was “acting in court representing me,” Browder replied.

And he had a law degree in Russia?

“I’m not aware he did.”

Did he go to law school?

“No.”

How many times have you said Mr. Magnitsky is a lawyer? Fifty? A hundred? Two hundred?

“I don’t know.”

Have you ever told anybody that he didn’t go to law school and didn’t have a law degree?

“No.”

Critically important, during the court case, the responsible US investigator admitted during questioning that his findings were based exclusively on statements and documents from Browder and his team. Under oath, Browder was unable to explain how he and his people managed to track the flow of money and make the accusation against Prevezon. In his 2012 letter that launched the court case, Browder referred to “corrupt schemes” used by Prevezon, but when questioned under oath, he admitted he didn’t know of any. In fact, to almost every question put forth by Mark Cymrot, Browder replied that he didn’t know or didn’t remember.

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Corruption, Clientelism and Murder - Malta Emerges as the EU's Next Problem Child

Two years after the murder of journalist Daphne Caruana Galizia, Malta's vast cesspool of corruption has become impossible to ignore. The EU's smallest member state is on the brink of failure.

By Frank Hornig and Juan Moreno

Michael Vella, father of late Daphne Caruana Galizia, holding a portrait of his late daughter

at a protest demanding justice for her. Darrin Zammit Lupi / REUTERS

"There are crooks everywhere you look now. The situation is desperate."

Daphne Caruana Galizia on Oct. 16, 2017, in her last blog entry, posted 24 minutes before her murder.

It's tempting to ask Corinne Vella how she avoided going crazy in the last two years. It is one thing, after all, to lose your sister to a hit job -- to learn that she was murdered in cold blood by a car bomb. But it is quite another to live with the conviction that neither the police, nor the country's government nor public prosecutors seem to have much of an interest in getting to the bottom of the crime.

Vella is sitting in the lobby of the luxurious Phoenicia Hotel in Valletta, the capital of the Mediterranean island nation of Malta. Jazz is playing in the background and the waiters wear ties, at pains to serve guests from the correct side. Vella is a serene woman, perhaps even shy. But she's here because she wants to talk about her sister and the factors that led to her death. It's the strategy she uses to avoid going crazy. "Daphne basically became my job. There isn't much else I've done in the last two years."

Vella is the sister of Malta's most famous journalist, Daphne Caruana Galizia. Daphne, as everyone in the country calls her, was murdered in a targeted killing on Oct. 16, 2017. She was a blogger, and her frequently extremely well reported, occasionally biting and sometimes humiliating reports were required reading on the island. Some of her entries were read more than 400,000 times. Everyone knew Daphne, many were afraid of her -- and not a few hated her.

"When Daphne was killed, people wrote on social media that the witch had finally got what she deserved," says Vella. Her family closed ranks after the murder and resolved to do everything in their power to ensure that the murderer would not go unpunished. Aunts, nieces, sons: They all protested at government agencies, got European institutions involved and spoke at journalism conferences.

The investigation, meanwhile, proceeded only sluggishly. Police arrested three suspects, ex-convicts who officials felt could have been responsible because of their criminal records and because of clues that seemed to point in their direction, but there was no obvious motive. Why should these men kill a journalist? Caruana Galizia never wrote a word about them. Who really wanted the prominent journalist dead?

Moving Quickly

Now, a bit more than two years after the attack, things have suddenly begun moving quickly. Two weeks ago, Yorgen Fenech, a businessman and a member of one of Malta's wealthiest families, was arrested on his yacht -- apparently just as the multimillionaire was preparing to leave the island. He has since been charged with accessory to murder. Despite incriminating witness testimony, Fenech continues to deny any wrongdoing. He has, however, accused a member of the Maltese government of being involved in the murder: Keith Schembri, chief of staff to the country's prime minister.

Schembri resigned last week, despite insisting he is innocent. But then Prime Minister Joseph Muscat also announced his intention to step down in January. Opposition politicians in parliament demanded that he not wait so long and vacate his office immediately. Meanwhile, demonstrators pelted Muscat with eggs.

"It has been the two most chaotic weeks in Malta's recent history," says Corinne Vella, adding that she has spent almost the entirety of the last few days on her mobile phone because of the torrent of news. For the first time, she now has the feeling that she may ultimately learn who killed her sister.

Daphne Caruana Galizia's sister, Corinne Vella - Gianmarco Maraviglia/ / DER SPIEGEL

Malta, the European Union's smallest member state, generally stays out of the headlines. Two-and-a-half years ago, DER SPIEGEL and other European media outlets involved with European Investigative Collaborations (EIC) published the "Malta Files," which revealed how German companies were able to save on taxes by establishing themselves on the island. Beyond that, not much tends to be written about the country and its 475,000 residents.

Now, though, dubious links between Maltese business leaders, politicians and organized crime have become visible, and it increasingly looks as though Malta operates by a different rulebook than the rest of the EU. The separation of powers in the country appears to be largely non-existent, with police doing the bidding of politicians and the anti-money-laundering agency joining the judiciary in turning its back all too often on malfeasance, instead of investigating, prosecuting and punishing criminal behavior.

A poster of Maltese Prime Minister Joseph Muscat - Guglielmo Mangiapane/ REUTERS

Alarmed, the European Parliament sent a delegation to Malta a few days ago, with the European Commission in Brussels warning the country's government to refrain from exerting political influence on the investigation. The murder of Caruana Galizia, it would seem, is no longer just a problem for Maltese politics. It is now emerging as an acute threat to European values, the rule of law, the freedom of the press and a rules-based market economy. Ultimately, it is about how many banana republics the EU can tolerate within its ranks.

An Economic Miracle?

There is much more on this story at Der Spiegel.

Bill Browder - Hero or Villain? Where's the Truth?

Yesterday, Bill Browder accused GOP Congressman Rohrabacher of being a Russian stooge. He had no proof, only the accusations that Rohrabacher was trying to undue some of what Browder has 'accomplished'; things like the Magnitsky Act. Rohrabacher accused Browder of intimidation, which, he thought, was suspicious in itself.

Bill Browder Escapes Again

by philip giraldi, Ron Paul Institute

There was some good and bad news last week. The good news was that William Browder, a London-based investor and dedicated foe of Russian President Vladimir V. Putin was arrested by the Spanish police on Wednesday. The bad news is that even though Russia has on six occasions requested Browder’s arrest through Interpol for tax fraud, the Spanish national police determined that Browder had been detained in error because the international warrant was no longer valid and released him.

Interpol, an organization of 190 countries cannot legally enforce any action of a “political character.” This can make it difficult to obtain red notices such as those being sought by Russia on Browder, which are the equivalent of international arrest warrants.

One might reasonably ask why there is a crisis in US-Russia relations at all since Washington and Moscow have much more in common than not, to include confronting international terrorism, stabilizing Syria and other parts of the world that are in turmoil, and preventing the proliferation of nuclear weapons. In spite of all that, the US and Russia are currently locked in a tit-for-tat unfriendly relationship somewhat reminiscent of the Cold War and it is only getting worse as self-appointed “experts” including Browder continue to prowl the fringes of policy making. Browder was in Spain to testify in a case against several Russian companies.

That William Browder might be regarded as controversial is somewhat of an understatement. Many who regard him as a crook serving as a catalyst for the bad policies relating to the US-Russia relationship would like to see him in jail. Israel Shamir, a keen observer of the American-Russian relationship, and celebrated American journalist Robert Parry both think that Browder single-handedly deserves much of the credit for the new Cold War.

William Browder, the grandson of Earl Browder, former head of the American Communist Party, is a hedge fund operator who made his fortune in the corrupt 1990s world of Russian commodities trading. One of many Jewish profiteers who descended on Russia, his current role is symptomatic of why the United States government is so poorly informed about overseas developments as he appears before Congress frequently and is the source of much of the “testimony” contributing to the current bad international climate. He has somehow emerged as a trusted source in spite of the fact that he has considerable interest in cultivating a certain outcome favorable to himself. Also ignored is his renunciation of American citizenship in 1998, reportedly to avoid taxes. He is now a British citizen.

Browder is notoriously the man behind the 2012 Magnitsky Act, which exploited Congressional willingness to demonize Russia and has done so much to poison relations between Washington and Moscow. The Act has sanctioned individual Russian officials, which Moscow has rightly seen as unwarranted interference in the operation of its judicial system.

Browder, a media favorite who self-promotes as “Putin’s enemy #1,” portrays himself as a selfless human rights advocate, but is he? He has used his fortune to threaten lawsuits for anyone who challenges his version of events, effectively silencing many critics. He claims that his accountant Sergei Magnitsky was a crusading "lawyer" who discovered a $230 million tax-fraud scheme that involved the Browder business interest Hermitage Capital but was, in fact, engineered by corrupt Russian police officers who arrested Magnitsky and enabled his death in a Russian jail.

Many have been skeptical of the Browder narrative, suspecting that the fraud was in fact concocted by Browder and his accountant Magnitsky. A Russian court has supported that alternative narrative, ruling in late December 2013 that Browder had deliberately bankrupted his company and engaged in tax evasion. He was sentenced to nine years prison in absentia.

William Browder has also been regularly in the news in connection with testimony related to Russiagate. On December 16, 2017 Senator Diane Feinstein of the Senate Judiciary Committee released the transcript of the testimony provided by Glenn Simpson, founder of Fusion GPS. According to James Carden, Browder was mentioned 50 times, but the repeated citations apparently did not merit inclusion in media coverage of the story by the New York Times, Washington Post and Politico. Browder has become such an essential asset in the media story about “evil” Russia that he has become in a certain sense bullet proof in spite of his own personal very questionable history.

Fusion GPS, which was involved in the research producing the Steele Dossier used to discredit Donald Trump, was also retained to provide investigative services relating to a lawsuit in New York City involving a Russian company called Prevezon. As information provided by Browder was the basis of the lawsuit, his company and business practices while in Russia became part of the investigation. Simmons maintained that Browder proved to be somewhat evasive and his accounts of his activities were inconsistent. He claimed never to visit the United States and not own property or do business there, all of which were untrue, to include his ownership through a shell company of a $10 million house in Aspen Colorado. He repeatedly ran away, literally, from attempts to subpoena him so he would have to testify under oath.

Per Simmons, in Russia, Browder used shell companies locally and also worldwide to avoid taxes and conceal ownership, suggesting that he was likely one of many corrupt businessmen operating in what was a wild west business environment. My question is, “Why was such a man granted credibility and allowed a free run to poison the vitally important US-Russia relationship?” The answer might be follow the money. Israel Shamir reports that Browder was a major contributor to Senator Ben Cardin of Maryland, who was the major force behind the Magnitsky Act.

Cardin and others in Congress have made Russia the bete noir of American politics, finding it convenient to scapegoat Moscow for the failure of the United States to put together a coherent and functioning foreign policy. Bill Browder is an essential component in that effort. Perhaps someone should ask him how he became a billionaire in a corrupt Russia going through political crisis and democratization in the 1990s. It would be interesting to learn what he has to say in his defense.

We may never really know what happened in Russia when Browder made his fortune. But it seems clear that he didn't play ball with the other oligarchs. I'm quite sure that no-one is innocent in this entire affair, least of all the Russian government, but it's unfortunate that the American government and media take Browder's accusations as Gospel because it fits their current narrative,  instead of casting doubts upon his story and his character as anyone interested in the truth would do.

Doesn't anyone truly desire the truth anymore?

South Korean Prosecutors Seek Arrest Warrant for Korean Air Chairman

Corruption is Everywhere

 - and it's completely trashed this once powerful South Korean family

By Wooyoung Lee 

Korean Air Lines Co. Chairman Cho Yang-ho appears at a prosecution office in Seoul on June 28, 2018, to undergo questioning over allegations of tax evasion, breach of trust and embezzlement. Photo by Yonhap

SEOUL, UPI -- South Korean prosecutors issued an arrest warrant Monday for Korean Air Chairman Cho Yang-ho for charges of inheritance tax evasion and embezzlement, among others.

Cho was summoned for a 15-hour questioning last week over such allegations at the Seoul Prosecutors' Office.

He has been under probe over suspicion that he evaded taxes for more than $45 million (50 billion won) in his inheritance of overseas properties from his father Cho Joong-hoon, the founder of Korean Air Lines, according to Yonhap.

Cho is also accused of paying his lawyer's fee from the company budget when his daughter Cho Hyun-ah, then the Korean Air vice president, was under trial over the notorious "nut rage" incident in 2014.

He also allegedly paid another lawyer's fee with the company fund when he was being investigated over a scandal, in which he received an unfair request to hire a lawmaker's relative in 2015.

Cho also faces an allegation of raising illicit profits from running a pharmacy.

It is the third time that a key member of the Korean Air founding family was called for an investigation and sought with an arrest warrant. Earlier, prosecutors requested arrest warrants for Cho's wife Lee Myung-hee for charges of illegally hiring foreign housekeepers, assault and verbal abuse.

Cho's daughter Hyun-min, the former vice president of Korean Air Lines' budget Jin Air, was also accused of assault from throwing a cup of water to a business meeting attendee.

The court, however, declined to issue arrest warrants for both mother and daughter.

You would almost think this family had made some powerful political enemies considering some of the charges leveled at them. Regardless of whether or not they have enemies, they seem to keep giving them ammunition to shot them with. Both daughters resigned from the airlines in April, and the father resigned in May (2nd story on link). 

Another Ex-President Questioned About Possible Corruption

Corruption is Everywhere - South Korean President

Seoul court to decide arrest warrant for former President Lee Myung-bak

By Jennie Oh  

Former South Korean President Lee Myung-bak (R) arrives to the Seoul Central District Prosecution Office for questioning in Seoul, South Korea, 14 March 2018. Former South Korean President Lee Myung-bak was summoned by a prosecutor for questioning over accusations of bribery and embezzlement. Photo by EPA-EFE/Woohae Cho.

SEOUL, UPI -- A Seoul court will determine this week whether to issue an arrest warrant for former President Lee Myung-bak, who is currently under investigation for alleged bribery and other misconducts during his years in office.

The Seoul Central District Court said it will hold a hearing on Thursday at 10:30 a.m. to review the prosecution's request for an arrest warrant, JoongAng Ilbo reported.

Prosecutors on Monday sought a permit to detain the former president, citing the degree of the allegations against him -- some 18 charges including bribery, embezzlement, tax evasion and abuse of power.

They also said Lee could attempt to destroy evidence, judging from his denial of most of the charges made against him in a 21-hour long questioning session last week.

In the warrant request, investigators pointed to Lee as the real owner of an auto company named DAS, which he has long been suspected of owning and controlling to conceal his assets and create secret slush funds.

The former conservative leader is also believed to have taken money from Samsung Group to fund legal costs for his auto parts firm, along with other bribes from other corporations and the country's intelligence agency.

The prosecution says he took some 11 billion won ($10.3 million) in kickbacks and embezzled 35 billion won ($32.7 million).

Investigators say they discovered critical evidence that supports their suspicions including his connection to DAS, during a raid on his office in January.

The court's decision on issuing a warrant for arrest is expected early Friday, Yonhap reported.

Lee's secretariat says the 76-year-old will not attend the hearing as he has "fully explained himself to the prosecution."