Category: Russia

Exclusive: Trump/Russia on Manhattan’s E. 64th Street

There’s a single block on Manhattan’s Upper East Side that perfectly embodies the conflicted state of relations between the Trump family and Russia.

The block is East 64th Street in Manhattan between Madison and Fifth avenues, one of the poshest in the city.

Residents and owners have over the years included Trump’s children, the family of Jared Kushner, a Russian oligarch, a Soviet-born billionaire and major GOP donor, and the family of another Russian oligarch friendly with Ivanka.

The story of East 64th Street isn’t a story of collusion over a cup of borrowed sugar, but rather a story about the global elite — people from all over the world who are connected by networks of money, power and influence that concentrate themselves in cities like New York and London.

Just across the street from Central Park, you’ll find the limestone mansion that Trump’s children once called home. Don Junior, Ivanka and Eric Trump moved into 10 E. 64th Street after their mother, Ivana, was granted sole custody in her tumultuous 1992 divorce. Ivana still lives in the building.

Across the street, at 11 E. 64 Street, sits a mansion owned by Oleg Deripaska, the Russian oligarch and aluminum tycoon who has been sanctioned by the U.S. government.

Deripaska’s stake in the building was revealed in a case brought in New York by Alexander Gliklad, who was seeking billions in dollars from Deripaska:

Gliklad v Deripaska

U.S. government sanctions prevent Deripaska from selling the pied-a-terre he purchased a decade ago for $42.5 million from art dealer Alec Wildenstein.

Complicating matters, Deripaska’s house was occupied last year by the ex-wife and children of Roman Abramovich, another Russian oligarch connected to Putin who is perhaps best known for his ownership of London’s Chelsea Football Club.

Dasha Zhukova, Abramovich’s ex-wife, listed her address as 11 East 64th Street on this New York City property record a year ago:

Perhaps not coincidentally, Dasha Zhukova happens to be good friends with Ivanka Trump. The two women have known each other for more than a decade and were photographed together at the U.S. Open tennis tournament during the 2016 presidential election. Abramovich and Kusher have met three to four times in social settings, Bloomberg reported.

Another owner on East 64th Street is Ukrainian-born Len Blavatnick, one of the richest men in the world. Blavatnik spent $90 million to buy a Gilded Age limestone townhouse at 19 E. 64th St.

Blavatnik is a business partner of his 64th Street neighbor, Oleg Deripaska. The two have stakes in Rusal, one of the world’s biggest aluminum producers, although Deripaska was recently forced by the U.S. government to give up control of the company.

One of Rusal’s major shareholders, SUAL Partners Limited, was founded by Blavatnik and the sanctioned Russian oligarch Viktor Vekselberg. Blavatnik resigned from Rusal’s board two days after Donald Trump was elected president.

Blavatnik, who is now a citizen of both Britain and America, donated $1 million donation to Trump’s inauguration

During the 2016 election, Blavatnik contributed another $6.35 million to leading Republican candidates and incumbent senators.

The top recipient was Senate Majority Leader Mitch McConnell, who raked in $2.5 million for his GOP Senate Leadership Fund under the names of two of Blavatnik’s holding companies, Access Industries and AI Altep Holdings.

Marco Rubio’s Conservative Solutions PAC and his Florida First Project received $1.5 million through Blavatnik’s two holding companies. Lindsey Graham of South Carolina received $800,000 from Blavatnik’s company. Ohio Governor John Kasich took $250,000 from Blavatnik and Arizona Senator John McCain another $200,000.

Blavatnik had tried to buy 19 E. 64th St. for years. He even sued the previous owners, the Wildenstein family, when an earlier deal fell through. His lawsuit describes the building in almost loving terms:

Access v 1964 Realty LLC

The Kushners long had a presence on the block as well. A family company purchased 26 E. 64th Street in 1989 and sold it 2007, the same year that Jared met Ivanka.

Finally, the last person I could find connected to Trump on this fascinating block was Verina Hixon, who used to rent an apartment at 14 E. 64th Street. She was kicked out for nonpayment of maintenance fees.

Hixon’s story is just as wild as any of her better-known neighbors. The Daily Beast ran a story about her titled “The Party Girl Who Brought Trump to His Knees.”

In 1982, the Austrian-born, Swiss-educated Hixon bought four apartments in Trump Tower for $10 million. The apartments were widely believed to belong to Hixon’s “friend,” John Cody, head of a local Teamsters union that was closely linked to the Cosa Nostra. Cody went to jail, Hixon went bankrupt and lost the Trump Tower apartments.

She found a new home on East 64th Street where she befriended Ivana Trump. Ivana visited Hixon’s $20 million chalet in St. Moritz, Switzerland. Ivana brought along her dachshunds who relieved themselves all over Hixon’s home and that was the end of their friendship.

Exclusive: Who is Sergey Yatsenko?

Sergey Yatsenko via ok.ru

Anyone who has followed the story of Trump and Russia knows the name of Carter Page, the bullet-headed Trump campaign advisor who became the subject of a top-secret investigation into whether he was or was not a Russian agent.

Less well-known, in fact hardly known at all, is Page’s 59-year-old business associate, Sergey Yatsenko.

In his testimony before the House intelligence committee, Page described Yatsenko as an “old friend” and “an international advisory board member” of his New York-based firm, Global Energy Capital LLC. The Mueller report describes Yatsenko as a “senior advisor” working with Page on a contingency basis.

An examination of Yatsenko’s background reveals more: a wealthy, well-connected man with a past that suggests — but doesn’t prove — connections in Russian intelligence circles. Page didn’t respond to a message left seeking comment; Yatsenko could not be reached.

Page and Yatsenko met while Page was the deputy branch manager of Merrill Lynch’s office in Moscow from 2004-2007. At the time, Page was working on large deals involving the Russian gas giant, Gazprom, “such as buying of a stake in the Sakhalin oil and gas field in the Sea of Okhotsk,” Bloomberg reported.

(Interestingly, Page’s boss at Merrill’s Moscow office, Allen Vine, left in 2006 to work for Suleiman Kerimov, a Kremlin-connected tycoon and member of the upper house of Russia’s parliament who has been sanctioned by the U.S. Treasury.)

When he met Page, Yatsenko was then Gazprom’s deputy chief financial officer. He worked on large deals involving the takeover of Roman Abramovich’s oil giant Sibneft as well as a $200 million loan from Deutsche Bank.

Most interesting to me was Yatsenko’s position on the board of Gazprombank from 2008-2009. Gazprombank has backed projects by Dmitry Firtash, a Ukrainian billionaire, who was indicted in Chicago for bribery. Prosecutors have called Firtash an “upper echelon” associate of Russian organized crime. (Despite its name, Gazprom only holds a minority stake in Gazprombank.)

Sergey Yatsenko, third from right at a Gazprom press conference. His boss, CFO Andrey Kruglov, is in the center. Kruglov is now Russia’s deputy finance minister

After leaving Gazprom in 2010, Yatsenko joined forces with Page and relocated to London. He also acquired a small fortune in European real estate.

A £3 million flat in fashionable Chelsea and a £6.2 million six-bedroom home in Kensington are held in the name of Yatsenko’s wife, a banker based in London who specialized in Russian energy deals.

According to sources, Yatsenko’s wife also holds property in the south of France, via a real estate investment company. The property is worth an estimated 3 million Euros.

Listing in the French yellow pages, pages jaunes.

Russian corporate records show Yatsenko holds a stake in the Severyanin (Northerner) Homeowners Association 31, a corporate town was built in 2006 for top Gazprom employees. Another co-owner is Mikhail Putin, a second cousin of the president, who had worked in Gazprom’s medical department.

Carter Page

Page, by contrast, is a man of limited resources. The Mueller report notes that he was forced to draw down his life savings to support himself and pursue his business. Page represented himself in his now-dismissed lawsuits against the Democratic National Committee and Yahoo! parent Oath Inc. He told the House intelligence committee that, in 2016-17, he was living off passive investments.

The mystery then is what drew Yatsenko into business with a nobody, a man few in the Russian energy sector had ever heard of before he joined the Trump campaign. “I can poll any number of people involved in energy in Russia about Carter Page and they’ll say, You mean Jimmy Carter?’” one veteran Western investor in Russian energy told Politco’s Julia Ioffe.

Could their relationship have something to do with the fact Page had attracted the attention from Russian spies like Alexander Bulatov in 2008 and Victor Podobnyy in 2013, who called Page an “idiot” who got “hooked on Gazprom“?

These links were part of the reason the FBI sought an October 2016 warrant to surveil Page. That warrant has been heavily criticized because it was also partly based on information provided by the former MI6 agent Christopher Steele, who was hired to gather dirt on the Trump campaign. Much of the warrant remains redacted.

An interesting detail is found buried in a Russian public disclosure filed by Gazprombank: Yatsenko graduated in 1984 from Singapore University with a degree in Chinese language.

To anyone who understands life in the former Soviet Union, Yatstenko’s education in Singapore leaps off the page. Studying abroad didn’t just happen for Soviet citizens the way it does in the West, not without approval from the highest circles of power.

Posing as a student was a cover employed by agents of the KGB. A CIA paper noted: “A substantial number of [KGB] students go for a year or more as exchange students or as trainees with Soviet organizations working abroad.”

The year Yatsenko joined Gazprom — 2002 — was a time when the Russian gas giant was heavily recruiting ex-spies. Even the company’s deputy chief executive, Valery Golubev, was an ex-KGB agent.

When Yatsenko left Gazprom in 2010, a curiously-worded report noted that his departure from the company “is most likely connected with the transfer to another job outside the Gazprom group and is not caused by any conflict.”

Yatsenko certainly maintained his influence after partnering up with Page. In December 2016, Yatsenko arranged meetings for Page and Kazakhstan’s ambassador to the United Kingdom, Page told the House intelligence committee.

Yatsenko told Bloomberg he worked with Page to help a Russian investor explore an oil investment in Iraqi Kurdistan, and advising a Chinese investor looking to buy Russian oil assets in Eastern Siberia. There were discussions about natural-gas-powered vehicles in Russia, possibly in partnership with Gazprom, but sanctions put an end to those talks.

“[Page] understands what’s going on in Russia,” Yatsenko told Bloomberg in 2016. “He doesn’t make strong judgments.”

The CEO of Overstock Has More to Say about Maria Butina, the FBI … and Don Jr

Maria Butina with Overstock.com CEO Patrick Byrne

Editor’s note: After I published my Q&A with Overstock CEO Patrick Byrne about his relationship with Maria Butina and the FBI, I sent him a link. He responded with additional comments to expand upon and clarify some of the things he said, so I am reposting the entire Q&A with Byrne’s additional comments indicated in bold.

Not long ago, I had an email exchange with Patrick Byrne, the CEO of Overstock.com, about his relationship with Maria Butina, the Russian gun-rights activist who was sentenced to prison after she tried to set up an back-channel between the Trump campaign and the Kremlin.

Byrne told me three high-ranking officials (whom he calls “X,Y, and Z”) in the Obama administration directed him to “resume a romantic relationship” with Butina. He says the Russia investigation started when he contacted the FBI (which he refers to as the “Men in Black”) about Butina in July 2015. Byrne says he has a “non-standard relationship” with the FBI.

I have concerns about Byrne’s credibility, as I noted in a previous post, and I’ve tried, with limited success, to verify his claims. What I’ve been able to confirm is that Byrne and Butina did meet in July 2015, they had a brief romance and they kept in touch until Butina’s arrest three years later.

I spoke to Butina’s attorney, Robert Driscoll, on Sunday, by phone from Tallahassee, Florida, where he was visiting his client in prison. Driscoll has long suspected Byrne was a government informant, but it wasn’t a major focus of his efforts. In a letter last month to the Justice Department, Driscoll noted the government had “flatly denied” his speculation that Byrne was a government informant. He now says believes that Byrne was passing information about his client to the government.

The Justice Department declined my request for comment, although, interestingly, my email was routed to Peter Carr, former spokesman for Special Counsel Robert Mueller’s office. Carr is now with the Office of Professional Responsibility, which will be handling any investigation into Byrne’s claims.

So there things stood until this week, when Byrne’s story took on a life of its own. Overstock issued a press release in which Byrne announced, “I am the notorious ‘missing Chapter 1’ of the Russian investigation.” (The company’s stock fell more than 30 percent on the news.) On Thursday, The New York Times followed up with a story on Byrne’s claims.

I believe people need to hear what Byrne told me — this guy is the CEO of a publicly-traded company, after all — so here goes:


Q. You met Maria Butina at Freedom Fest in July 2015.

A. Correct.

Q. You began dating shortly thereafter.

A. No. We had an intellectual discussion for 90 minutes. She knew all about me already.

She told me there was a circle in Russia of about 150 liberals, from across the Russian power structure, including the oligarchs. They watched my videos on liberalism. They know about my relationship with Milton Friedman. They discuss things I say and write.

I should make clear that Maria is an unusually impressive young woman. Chosen for a school for which 30 brainiac children from across Russian get selected each year. Graduated No. 2 in her class. Super-conversant on the history of liberalism, from the Greeks to Locke and Jefferson. Knows U.S. history and the Constitution better than about 99 percent of millennials. Also, the Greater Moscow Power Lifting Champion (or something like that).  I have taught at the university level (teaching fellow at Stanford, visiting prof at Dartmouth), known a lot of smart young people, and she is pretty remarkable. She came across as far more adult and capable than a typical 26-year-old should.

She also told me that General Mikhail Kalashnikov had started a gun rights group in Russia [Право на Оружие — Right to Bear Arms]. But the main function of the group was really to be a club for liberals. “Believe it or not, Dr. Byrne, General Kalashnikov was a liberal, too!” Maria told me.

And he had selected he had selected her to lead it.  

“Do you know what this means in our culture, Dr. Byrne, that a man like General Kalishnikov would select a 23-year-old female, to lead such a group?” Maria asked me.

She mentioned that there are 50 oligarchs who run Russia, but seven who really run Russia, and that she, Maria, was well known to four of them. She mentioned that she might end up president of Russia someday. Or that at least there were people grooming her for that.

She took care to explain that they were loyal Russian people, “President Putin is our president, no one is talking about anything inappropriate,” she said.

But they wanted to discuss liberalism, and what a post-Putin age might look like in terms of U.S.-Russian relations.

I’m sensing that this may seem odd to you. It’s no so odd for me. Especially since I started being called this kind of stuff. But even before blockchain. But I already sense that you are one of those guys who rolls his eyes a lot, so I’ll stop there.

They had sent her with a message for me to come to Moscow to speak on Bitcoin, then go to the Altai Mountains to a resort that would be shut down for three days so I could meet with 40-45 people from across the Russian power structure — government, oligarchs — to discuss liberalism, John Stuart Mill, Hayek, and global relations, and what a post-Putin age might look like.

We parted after meeting that day in Vegas, her stipulating that we would text to make future arrangements and that she would be texting me under the guise of us having a romantic relationship.

I reported that night to my clearance authority (where I once kept a low level clearance due to some minor advisory work I do in foreign policy).

I gave a description of the situation and wanted to know:

  • May I introduce her to some senior thinkers in the foreign policy establishment (My hope was to Yenta her in to talking to some senior thinkers in the foreign policy establishment whom I know through the Council on Foreign Relations. I thought she would be interesting for someone to spend an afternoon talking to, and perhaps her dreams of a back channel for peace might ring a bell with someone.)
  • Is it OK if I travel to Russia on her invitation?
  • Or should I cut her out of my life as being a security risk?

I learned later that my report “sent up a flare over Washington” that very night. July 2015: That is when the Russian investigation started, not July 2016. That is the big coverup.

I got contacted by Men In Black (I do not like using the acronym “FBI”). They were unclear, but seemed to suggest that I should learn more then they would decide, but were not sure. It went back and forth for two months.

Meanwhile, Maria was writing me, asking me to Moscow, then Montenegro, then Rome, Paris, etc. Watching my YouTube videos on liberalism. Pretending to be fall in love.

Finally, in September, I sent word to the U.S. government that I was not going to meet Maria again (lest I get in some hassle with the U.S. government) unless I was given the word “Greenlight.” They sent: “Greenlight.”

So I went to meet her for the second time in September 2015 at hotel room in New York City with the idea that we would spend a few days talking, getting to know each other, a possible trip to Russia and the purposes thereof. It was a two-bedroom suite. She arrived first. When I arrived, she made clear immediately (as in, less than three seconds) that she had not been pretending and wanted to make it romantic. I was putty in her hands.

Q. You had done some work for the FBI in the past?

A. I helped the Men in Black twice before.

[Note: Byrne forwarded two links to me. One is a Sports Illustrated story that discusses Byrne’s friendship with ex-NBA player Bison Dele, who disappeared while sailing in the South Pacific in 2002. The other is a link to his talk about naked short selling and corruption on Wall Street, Deepcapturethemovie.com]

I have also had the honor of playing a tiny, tiny role in three peace events in my life. So again, while Maria’s story may seem odd to you, I know that are times where tiny events lead to something good happening. Like peace. I’ve seen it. I know there are a lot of deep thinkers who argue that Maria had to be a Red Sparrow because they have seen the movie. You make your own call.

Q. What happened next with you and Butina?

A. I saw her sporadically (every 4-6 weeks?) from September 2015 through March 2016. Initially my estimation was:

  • 66% chance this is an opportunity of some kind. Maybe just getting a chance to preach the gospel of Liberalism and freedom in Russia. Maybe some good contacts. Maybe push the peace ball a couple of yards down the field.
  • 33% chance this is a risk

The Men In Black’s lack of responsiveness or concern was odd.

As the September 2015-March 2016 wore on, my estimation changed. Maria was spending less time talking about John Locke and John Stuart Mill, more time talking about the political circles in which she was swanking around.

She let me know [Alexander] Torshin, had told her to focus on Hillary, Rubio, Cruz, and Trump. Whichever of the four won, she was to have a contact in their administration.

[Note: Torshin was the deputy governor of the Central Bank of Russia who prosecutors say was directing Butina’s activities in the United States]

This kind of talk was especially concerning. So the Men in Black’s lack of apparent interest or concern was frustrating to me.

Around February, she asked me to fly to Russia, give a talk in St. Petersburg on Liberalism and Bitcoin, then spend an hour with Putin (who would be in town). The Men in Black studied, came back, said it was too dangerous, don’t go, break up with Maria. So I did. (I was also stage four of two things at once at the time, and they were on the brink of starting to yank out organs, so I was not going to argue.)

The Men in Black then had me get involved with a corruption case involving a federal official. That ran a couple of months. Something deeply unusual and troubling came out of that experience that led me to wonder if I was involved in law enforcement or political espionage.

On July 1, 2016, they came back and said, “What a mistake we made. Russia, Russia, Russia. We want you to know that the U.S. government never asks something like this but we are here to ask you to rekindle a romantic relationship with Maria. The orders are coming from X, Y, and Z.”

[Byrne declined to name these officials.]

“The USA never, ever does this, but these circumstances are so extraordinary, that you are being asked to do this. We want to remind you that you can refuse.”

And the agents were clearly extremely discomfited and unhappy about the whole thing. But the request came from X, Y, and Z.

The Men in Black are extremely honorable, straightforward men (and women), and there was no leering and rubbing of hands with excitement. They were clearly extremely discomfited. They reminded me several times that I could refuse the request (I suspect they were secretly wishing I would refuse it, in fact).  No one would think less of me if I refused it, etc. All that kind of stuff. They were quite uncomfortable about it all. But…. X, Y, and Z were sending the request, and it was their job to communicate it. That is the reason I do not like using the initial “FBI” when explaining this. It seems unfair to them. As far as I could tell, they were hijacked from the top.

I decided that I had gotten sucked into what was starting to seem a lot more like political espionage than law enforcement. I knew this was all going to end up in front of a jury, or in television, or in the history books, and I did not want to disgrace our country or Maria by carrying out those orders. I would have if I had thought them legitimate. I’ve done lots of stranger things for our country, related to tracking down Brian William’s murderous brother in Mexico, for example but this smelled like skunk, so I decided to do two things instead:

  1. Lie to the feds. I would wine and dine and romance Maria, and give the public perception that we were once again romantically involved. I would blow her away with being this unbelievably romantic gentleman to her. I would report that I was back in the saddle, but all the while 100% NEVER TOUCH HER. I knew I had to be 100% pure on that bright line, so when the day came that it was all unearthed (which I knew would happen), the record would show that actually I had not laid a finger on her. (I understand that she and her lawyer have confirmed to other journalists that I was a total, perfect gentleman to her during that second phase we spent time together).
  2. Set up X,Y, Z for felony charges down the road

Q. You conveyed all of this to the Justice Department, including the name of the three higher-ups in the Obama administration in April 2019?

A. Yes on April 30 I told them all of this, including that the U.S. government had know all about Maria in July 2015 from me, and had known about each of her subsequent meetings (e.g. Don Jr.) before she had them, and had let them all occur.

Q. On May 20, 2016, Butina and Torshin attended the National Rifle Association convention in Louisville, Kentucky and shared a table with Donald Trump Jr. at a private dinner. Is that what you’re talking about?

Editor’s note: In earlier version, Byrne suggested that Butina had made him aware of a possible second meeting between Butina and Don Trump Jr. Butina’s attorney, Robert Driscoll denied that such a meeting took place and, after some back and forth discussions, I gave Byrne an opportunity to revise his answer.

The truth is I am not completely sure, but the answer is, “Most likely.” I will distinguish what I surmise from what I know. And when telling you what I know, I will distinguish between what I know with total confidence, and when I am unusually vague. Please remember that I am somewhat foggy on things come the latter part of March, 2016 and into Spring.  Rough time medically.  

At some point in the first three months of 2016 Maria spoke of some meeting being arranged/to be arranged with Don Jr. via some of the Republican Party bigwigs with whom she had been schmoozing. In her description, it was to occur in a clandestine manner, it was to occur at a convention of conservatives of some kind, and was to occur somewhere in the South (I vaguely but not confidently remember “Tennessee”). It was not clear how stable or firm a plan it was, but it was clear that she had her Republican big shots working it.

Something I do remember with total clarity, however, is that the Men In Black were completely disinterested and indifferent. I was perplexed: I offered to whisk her off to somewhere exotic instead just to block such a meeting. They consulted then returned with this answer: We’re just going to let it play out. That is when they told me a fib to keep me in check, along the lines of Sometimes when spies come to the U.S. we might just follow them and see where they go, who they meet…. But I knew there is no way they would do that, certainly not meeting the son of the likely presidential nominee. Not in this case. That, coupled with the fact (not yet explained) that I, around about the same time, had been involved in a corruption matter, and it also played out in a way that seemed fishy, made me think…. they were leaving something out.

Since this all blew up, it may surprise you to know,  I have often tried to follow news about this as little as possible, so as to keep my own memory fresh for the day the right people asked me for the truth. Eventually that became impossible, but I tried. So it was only more recently that learned from a news broadcast about Maria (which I have generally avoided, frankly) that among the people she met  while here was Don Jr. I could not have told you where until today, when I learned it from your question, that she met Don Jr. in a private dinner in May, 2016, with Torshin.  (However, that is not completely true: when I saw Maria some year or more later, I believe she confirmed to me she had met Don Jr. I am not sure, and I never asked the circumstances.)

Was that private meeting she was discussing with me in the first three months of 2016, the one that I remembered being a clandestine meeting at a convention of conservatives somewhere in the South, maybe Tennessee, the private dinner that happened in May at an NRA convention in Kentucky?  I can’t be sure, but I would think so. The details match up pretty well. Especially if Driscoll has confirmed she only meeting with Don Jr.

Also…. Did I make clear, Maria and I stopped speaking in early April? I was asked to break it off, I was super-sick, and I did. It was only around July 1 (+/- 7 days?) that the request came to revive things.  So we were not in contact while the dinner played out.

However, if it was May, then it happened well after they had made me feel batshit crazy for thinking there might be anything unusual about this Russian grad student, very bright and admirable, but connected to Russian senators and oligarchs, swanking around with big shots who were getting her in touch with the son of the possible next president.  Boy, did they gaslight me on that one. They made me feel like some kind of conspiracy nutjob to think that there might be anything problematic about that. Guess the joke was on me. 

Anyway, it was shortly after that — the period I was telling them of talk of arrangements being made for her to meet Don Jr., and they were brushing them off as silly to worry about — that she asked me to Russia to speak and meet Putin, and they came back and told me to break it off and get her out of my life. And as I said, I was right in that window that any recrudescence of disease would have led to organs getting pulled out as a next step. So I folded and disappeared from the scene. Probably first or second week of April 2016. I did not see her again until October 2016, I believe.

Q. What happened after you spoke to the Justice Department?

A. I learned that Maria was transferred 9 days later from a SHU unit [solitary confinement] in a prison in Virginia to the nicest women’s camp in the federal system. So I give great compliments to the DOJ. Nothing happens in 9 days normally. But I think they heard my story, checked out some of the basic claims, and moved her out of isolation by the end of the following week (May 9). The following Wednesday they announced John Durham.

[Note: John H. Durham, the U.S. attorney for the District of Connecticut, is investigating the origins of the special counsel’s probe into Russian interference in the 2016 election. News broke about his investigation on May 13. The Washington Post reported that the investigation had begun “in recent weeks.”]

I should make clear that I have no idea what connection there is, if any, between my coming forward and any subsequent events, including Durham’s appointment. I make no claims in that regard. I know only that I spoke twice to the DOJ, on April 5 and 30. I am under the impression that there are numerous other whistle-blowers coming forward, with tales that amount to political espionage conducted not just against Republicans, but against Hillary Clinton, by certain high-level actors (X, Y, and Z).  Mine may well be (and probably is) a footnote to a footnote to the whole story. I hope so.

Q. It’s a fascinating story, but I need to report it out. Is there someone who can corroborate this? 

Sara Carter has had some recent confirmation from the Department of Justice. I don’t know what your connections are like there, but that’s why you get paid the big bucks! I’m not in the convincing business. I am simply in the business or letting the world know what happened. My rabbi told me “You let feds do fed jobs, you do your job. You are a citizen. Your country is ripping itself in two. Your job is to come forward to the public.” So I have.

[Note: Byrne’s “rabbi” is Warren Buffett. Byrne’s father, John, was the CEO GEICO, one of Buffett’s companies, and Patrick has known Buffett for years.]

I watched this unfold for the last year knowing I had a lot of the answers, and in late June decided (and was advised by my rabbi) that I had a moral duty to come forward. So I have. It is proving interesting to see how long it takes the world to get it.

Ok, Seth, I have qualms. From what you have written so far, I fear that when you learn the full truth you will seek to distort it because it conflicts with some things you have written so far. On the other hand, I have it on good authority that you are a legitimate, honest reporter. I have given you a ton. I have a mountain more. Let us see how you represent what I have told you before going any further.

OK, signing off for now. Busy week ahead.

Overstock CEO Patrick Byrne on Maria Butina and the FBI

Maria Butina with Overstock.com CEO Patrick Byrne

“July 2015: That is when the Russian investigation started, not July 2016. That is the big coverup.”

Editor’s note: There is an updated version of this post available here.

Not long ago, I had an email exchange with Patrick Byrne, the CEO of Overstock.com, about his relationship with Maria Butina, the Russian gun-rights activist who was sentenced to prison after she tried to set up a backchannel between the Trump camapign and the Kremlin.

Byrne told me three high-ranking officials (whom he calls “X,Y, and Z”) in the Obama administration directed him to “resume a romantic relationship” with Butina. He says the Russia investigation started when he contacted the FBI (which he refers to as the “Men in Black”) about Butina in July 2015. Byrne says he has a “non-standard relationship” with the FBI.

I have concerns about Byrne’s credibility, as I noted in a previous post, and I’ve tried, with limited success, to verify his claims. What I’ve been able to confirm is that Byrne and Butina did meet in July 2015. Butina’s attorney, Robert Driscoll, has confirmed that they did have a romantic relationship. Driscoll also says the government “flatly denied” his speculation that Byrne was a government informant.

The Justice Department declined my request for comment, although, interestingly, my email was routed to Peter Carr, former spokesman for Special Counsel Robert Mueller’s office. Carr is now with the Office of Professional Responsibility, which will be handling any investigation into Byrne’s claims.

So there things stood until this week, when Byrne’s story took on a life of its own. Overstock issued a press release in which Byrne announced, “I am the notorious ‘missing Chapter 1’ of the Russian investigation.” (The company’s stock fell more than 30 percent on the news.) On Thursday, The New York Times followed up with a story on Byrne’s claims.

I believe people need to hear what Byrne told me, so here goes:


Q. You met Maria Butina at Freedom Fest in July 2015.

A. Correct.

Q. You began dating shortly thereafter.

A. No. We had an intellectual discussion for 90 minutes. She knew all about me already.

She told me there was a circle in Russia of about 150 liberals, from across the Russian power structure, including the oligarchs. They watched my videos on liberalism. They know about my relationship with Milton Friedman. They discuss things I say and write.

They had sent her with a message for me to come to Moscow to speak on Bitcoin, then go to the Altai Mountains to a resort that would be shut down for three days so I could meet with 40-45 people from across the Russian power structure — government, oligarchs — to discuss liberalism, John Stuart Mill, Hayek, etc.

We parted after meeting that day in Vegas, her stipulating that we would text to make future arrangements and that she would be texting me under the guise of us having a romantic relationship.

I reported that night to my clearance authority (where I once kept a low level clearance due to some minor advisory work I do in foreign policy).

I gave a description of the situation and wanted to know:

  • May I introduce her to some senior thinkers in the foreign policy establishment (My hope was to Yenta her in to talking to some senior thinkers in the foreign policy establishment whom I know through the Council on Foreign Relations. I thought she would be interesting for someone to spend an afternoon talking to, and perhaps her dreams of a back channel for peace might ring a bell with someone.)
  • Is it OK if I travel to Russia on her invitation?
  • Or should I cut her out of my life as being a security risk?

I learned later that my report “sent up a flare over Washington” that very night. July 2015: That is when the Russian investigation started, not July 2016. That is the big coverup.

I got contacted by Men In Black (I do not like using the acronym “FBI”). They were unclear, but seemed to suggest that I should learn more then they would decide, but were not sure. It went back and forth for two weeks.

Meanwhile, Maria was writing me, asking me to Moscow, then Montenegro, then Rome, Paris, etc. Watching my YouTube videos on liberalism. Pretending to be in love.

Finally, in September, I sent word to the U.S. government that I was not going to meet Maria again (lest I get in some hassle with the U.S. government) unless I was given the word “Greenlight.” They sent: “Greenlight.”

So I went to meet her for the second time in September 2015 at hotel room in New York City with the idea that we would spend a few days talking, getting to know each other, a possible trip to Russia and the purposes thereof. It was a two-bedroom suite. She arrived first. When I arrived, she made clear immediately (as in, less than three seconds) that she had not been pretending and wanted to make it romantic. I was putty in her hands.

Q. You had done some work for the FBI in the past?

A. I helped the Men in Black twice before.

[Note: Byrne forwarded two links to me. One is a Sports Illustrated story that discusses Byrne’s friendship with ex-NBA player Bison Dele, who disappeared while sailing in the South Pacific in 2002. The other is a link to his talk about naked short selling and corruption on Wall Street, Deepcapturethemovie.com]

Q. What happened next with you and Butina?

A. I saw her sporadically (every 4-6 weeks?) from September 2015 through March 2016. Initially my estimation was:

  • 66% chance this is an opportunity of some kind. Maybe just getting a chance to preach the gospel of Liberalism and freedom in Russia. Maybe some good contacts. Maybe push the peace ball a couple of yards down the field.
  • 33% chance this is a risk

The Men In Black’s lack of responsiveness or concern was odd.

As the September 2015-March 2016 wore on, my estimation changed. Maria was spending less time talking about John Locke and John Stuart Mill, more time talking about the political circles in which she was swanking around.

She let me know [Alexander] Torshin, had told her to focus on Hillary, Rubio, Cruz, and Trump. Whichever of the four won, she was to have a contact in their administration.

[Note: Torshin was the deputy governor of the Central Bank of Russia who prosecutors say was directing Butina’s activities in the United States]

This kind of talk was especially concerning. So the Men in Black’s lack of apparent interest or concern was frustrating to me.

Around February, she asked me to fly to Russia, give a talk in St. Petersburg on Liberalism and Bitcoin, then spend an hour with Putin (who would be in town). The Men in Black studied, came back, said it was too dangerous, don’t go, break up with Maria. So I did. (I was also stage four of two things at once at the time, and they were on the brink of starting to yank out organs, so I was not going to argue.)

The Men in Black then had me get involved with a corruption case involving a federal official. That ran a couple of months. Something deeply unusual and troubling came out of that experience that led me to wonder if I was involved in law enforcement or political espionage.

On July 1, 2016, they came back and said, “What a mistake we made. Russia, Russia, Russia. We want you to know that the U.S. government never asks something like this but we are here to ask you to rekindle a romantic relationship with Maria. The orders are coming from X, Y, and Z.”

[Byrne declined to name these officials.]

“The USA never, ever does this, but these circumstances are so extraordinary, that you are being asked to do this. We want to remind you that you can refuse.”

And the agents were clearly extremely discomfitted and unhappy about the whole thing. But the request came from X, Y, and Z.

I decided that I had gotten sucked into what was starting to seem a lot more like political espionage than law enforcement. I knew this was all going to end up in front of a jury, or in television, or in the history books, and I did not want to disgrace our country or Maria by carrying out those orders. I would have if I had thought them legitimate. I’ve done lots of stranger things for our country, but this smelled like skunk, so I decided to do two things instead:

  1. Lie to the feds. I would wine and dine and romance Maria, and give the public perception that we were once again romantically involved. I would blow her away with being this unbelievably romantic gentleman to her. I would report that I was back in the saddle, but all the while 100% NEVER TOUCH HER. I knew I had to be 100% pure on that bright line, so when the day came that it was all unearthed (which I knew would happen), the record would show that actually I had not laid a finger on her. (I understand that she and her lawyer have confirmed to other journalists that I was a total gentleman to her).
  2. Set up X,Y, Z for felony charges down the road

Q. You conveyed all of this to the Justice Department, including the name of the three higher-ups in the Obama administration in April 2019?

A. Yes on April 30 I told them all of this, including that the U.S. government had know all about Maria in July 2015 from me, and had known about each of her subsequent meetings (e.g. Don Jr.) before she had them, and had let them all occur.

[Note: On May 20, 2016, Butina and Torshin attended the National Rifle Association convention in Louisville, Kentucky and shared a table with Donald Trump Jr. at a private dinner.]

I learned that Maria was transferred 9 days later from a SHU unit [solitary confinement] in a prison in Virginia to the nicest women’s camp in the federal system. So I give great compliments to the DOJ. Nothing happens in 9 days normally. But I think they heard my story, checked out some of the basic claims, and moved her out of isolation by the end of the following week (May 9). The following Wednesday they announced John Durham.

[Note: John H. Durham, the U.S. attorney for the District of Connecticut, is investingating the origins of the special counsel’s probe into Russian interference in the 2016 election. News broke about his investigation on May 13. The Washington Post reported that the investigation had been picked “in recent weeks.”]

Q. It’s a fascinating story, but I need to report it out. Is there someone who can corroborate this? 

Sara Carter has had some recent confirmation from the Department of Justice. I don’t know what your connections are like there, but that’s why you get paid the big bucks! I’m not in the convincing business. I am simply in the business or letting the world know what happend.

I watched this unfold for the last year knowing I had a lot of the answers, and in late June decided (and was advised by my rabbi) that I had a moral duty to come forward. So I have. It is proving interesting to see how long it takes the world to get it.

[Note: Byrne’s “rabbi” is Warren Buffett. Byrne’s father, John, was the CEO GEICO, one of Buffett’s companies, and Patrick has known Buffett for years.)

Ok, Seth, I have qualms. From what you have written so far, I fear that when you learn the full truth you will seek to distort it because it conflicts with some things you have written so far. On the other hand, I have it on good authority that you are a legitimate, honest reporter. I have given you a ton. I have a mountain more. Let us see how you represent what I have told you before going any further.

The Strange Case of Eurotech

The company that links Paul Manafort, Anthony Pellicano, the Mafia, and action star Steven Seagal

Bruce Bigelow was a San Diego journalist and friend of mine who sadly passed away after a hiking trip in Utah at the age of 63.

A few weeks before his untimely death last year, Bruce and I shared a beer at a local bar in San Diego with game three of the NBA finals playing the background.

Bruce had spotted my book in Barnes & Noble and he wanted to catch up. He also had a story he wanted to share with me about a strange little company in San Diego that tried to sell the finest in Soviet technology.

Eurotech, Ltd. was trying to bring to market a foam that that had been developed in Russia and used to control the nuclear disaster at Chernobyl’s Reactor No. 4.

It might sound like the setup for a bad joke but Eurotech had convinced some investors to part with their money. The company’s shares had soared more than 800 percent in a few months from 1996 to January 1997. “Not bad for an enterprise with no sales, four employees and a strategy focused on striking deals in the risky, raucous business world of Russia,” as Bruce put it in his story.

At first glance, Eurotech seemed respectable. The chairman of the publicly-traded company was James D. Watkins, a retired Navy admiral and former chief of Navy operations who had served as energy secretary in the first Bush administration.

Things were less clear on close inspection. One Eurotech board member, Karl Krobath, was a business advisor to Nordex GmbH. That’s a name that ran alarm bells in the CIA in the 1990s, which suspected Nordex of smuggling drugs, weapons, and even nuclear technology for the Russian Mafia. Eurotech also was introducing automated parking garage technology in Moscow’s Arbat district in partnership with the notoriously corrupt local mayor’s office.

To Bruce, Eurotech looked like a classic “pump-and-dump” stock scam, where a company cashes out on sales of illegally inflated stocks. Eurotech’s shares were sold in private placements that evaded disclosure to the U.S. Securities and Exchange. As readers of my book know, this is the same murky world that Felix Sater operated in the 1990s in his days at the Mafia-linked White Rock Partners.

Bruce did a little digging and learned that no one working at Chernobyl had ever heard of Eurotech or its foam, called Ekor, and the company’s claims that it was part of a $3.1 billion cleanup was dubious, at best.

Bruce’s story, which ran in February 1997, left a mark. The Nordex advisor left the board followed shortly by the rest of the board and the company moved to Virginia.

A few days after Bruce’s story ran, he noticed someone sitting in a car parked on the street outside his house. The car stayed around for several days. An editor told Bruce he was just being paranoid.

Around the same time, he got a call from a private investigator in Los Angeles, who told Bruce that he was taking over press operations for Eurotech. If he had any questions for the company, this investigator told Bruce, he was the man to call.

I asked Bruce if he felt threatened. “No, it was just qualitatively different,” he told me. “This was not a typical PR/marketing firm. So it felt more intimidating in that sense.”

The private eye’s name was Anthony Pellicano.

*

I wrote to Pellicano at the Terminal Island prison in San Pedro where he was serving his 15-year sentence on 78 counts of wiretapping, racketeering, conspiracy and wire fraud.

Pellicano didn’t know anything about who was parked outside Bruce’s house and barely remembered Eurotech except for a possible connection to the mayor of Moscow, Yuri Luzhkov.

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But Pellicano has other interesting ties to the Eurotech story.

His case unraveled in 2002 when Los Angeles Times journalist Anita Busch walked out to her car to find a dead fish with a red rose in its mouth on the cracked windshield along with a note that read “Stop.” Busch believed that the threat was related to a story she was working on involving a dispute between actor Steven Seagal and his former producer, Julius R. Nasso. The FBI soon learned that Pellicano was behind the fish incident. Seagal was one of Pellicano’s clients.

Nasso, an associate of the Gambino organized crime family, had produced 10 films starring Seagal, including On Deadly Ground and Under Siege 2, and Out for Justice but their relationship ended in 1999. Nasso sued Seagal for $60 million.

(Interestingly, Nasso has an uncle, also named Julius Nasso, who ran a concrete company that partnered with S&A Concrete, the Mob-connected firm that built Trump Tower.)

Seagal claims that in February 2001 he was visiting Nasso in Brooklyn when he was ordered into a car and ushered into the back room of a Brooklyn steakhouse, Gage & Tollner. There, Seagal was threatened by a Gambino family captain, who told Seagal that he would be required to pay earnings from his movies to Nasso. The feds were listening in and the extortion plot got Nasso sentenced to prison for a year.

Around the same time of Seagal’s back room meeting in the steakhouse, Nasso purchased 500,000 shares of Eurotech at 33 cents a share.

How did Nasso come to learn about this company trying to market Russian foam? Probably through his friend and partner, Paul Manafort.

*

In January 2001, Eurotech agreed to pay Paul Manafort $300,000 a year to help it bring its superfoam to market. Eurotech subsequently hired Davis Manafort to raise capital on its behalf in exchange for a 4 percent finder’s fee. The guy who hired Trump’s future campaign chairman was the late Don Hahnfeldt, a one-time Florida lawmaker.

In addition, Manafort acquired 2,500,000 shares of Eurotech at 33 1/3 cents per share, through one of his companies, John Hannah LLC.

That name might ring a bell. John Hannah LLC is the same company that paid $3.675 million in 2006 for Manafort’s apartment 43G in Trump Tower.

On the same day that Manafort acquired his shares in Eurotech, Julius Nasso also acquired 500,000 shares in the company.

Nasso and Manafort, along with producer Paul Cohen and actor Danny Aiello, were partners together in a short-lived film production and distribution company formed in 2001 called Manhattan Pictures International. Another investor in Manhattan Pictures was Fred Trump’s right-hand man, Brad Zackson.

Manafort apparently saw film making as a natural extension of his work representing corrupt dictators around the world like Ferdinand Marcos and Mobutu Sese Seko.

“In many respects, a lot of what makes a film successful also makes lobbying successful,” Manafort told the New York Daily News. “You need to understand the demographics of the country whether it’s a candidate or a motion picture. In films, like successful campaigns, you need to know how to create messages.”

The company produced Enigma, starring Kate Winslet, and a few other films and then shut down.

During a search of Paul Manafort’s storage locker, the FBI came across some boxes relating to Manhattan Pictures and Julius Nasso.

Manafort is now in prison. Nasso, out of prison, is back producing movies. And his old friend Steven Seagal has gotten very, very close to the president of Russia. He’s now Vladimir Putin’s special envoy to the United States.