Category: Spooks

Who is Tevfik Arif? Part I

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Tefvik Arif was the chairman of Bayrock Group, the murky company that partnered with Donald Trump to build Trump SoHo in lower Manhattan.

Figuring out who he is was not an easy task.

Tevfik Arif (Тевфик Ариф) was born Toifik Arifov (Тофик Арифов) on May 15, 1953 in the Soviet Socialist Republic of Kazakhstan. He was one of four brothers born to a Turkish family in the Jambyl Region in northern Kazakhstan.

That’s about the only thing we know about his early life with any certainty.

What he did for the next 38 years is unclear. The oft-repeated facts of his background come from a short profile on Arif published in Real Estate Weekly in 2007, just as Trump was preparing to kick off sales of Trump SoHo.

Real Estate Weekly reported that Arif had received a degree from Moscow Institute of Trade and Economics and then worked in the Soviet Ministry of Commerce and Trade in the former Soviet Union for 17 years, where he served as the chief economist and deputy director of the Ministry’s Department of Hotel Management.

Many journalists have repeated this story. It may be true, but no one seems to have bothered to check.  It’s worth noting that this is the only reference to a Soviet Ministry of Commerce and Trade that I found on the Internet. There is a Russian ministry that has this name, but I could find nothing from the Soviet era. (Arif did not speak English very well, so it’s possible this is a mistranslation.)

There was, however, something called the USSR Chamber of Commerce and Industry, which was run by the KGB and spied on the West. A third of the chamber’s staff were KGB, according to a US State Department report that cited CIA information. And the USS Chamber of Commerce and Industry did have a hotel division, V/0 Sovintsentr, which ran a trade center and various Moscow hotels.

In the Russian press, Arif is affiliated with the Soviet Ministry of Foreign Trade (which did exist). Or maybe he was just a Soviet hotel bureaucrat, as he claims. Whatever Arif did for the first 40 odd years of his life, he hasn’t been very open about it.

Trans World Group

After the collapse of the Soviet Union in 1991, Arif left the government and made a career leap. A huge leap.

In a court proceeding in Turkey, the former Soviet hotel bureaucrat testified that he “worked in energy sector, chemical sector and metallurgy sector. I was producing coal in Russia and copper in Kazakhstan. Due to lack of coal, it was not possible to make production. I started to organize them.” He started a private company called the Speciality Chemicals Trading Co., trading in “chrome, rare metals and raw materials.”

And then he went to work for Trans World Group. TWG was a British company headed by two brothers, David and Simon Reuben. After the Soviet Union collapsed, the Reubens moved aggressively into metals production, buying up smelters and refineries.

As foreigners, however, the Reubens needed locals to build their business. Enter Arif. He became an “agent on the ground” — a fixer, in other words — for TWG in Kazakhstan, according to internal company documents reviewed by theblacksea.eu, an online investigative Website.

Arif apparently did his job well. Very well. In a few years, TWG’s holdings of steel, iron, chrome and alumina refineries in Kazakhstan generated one fifth of the entire country’s gross revenues.

Maybe Arif was just a Soviet hotel bureaucrat who seized a once-in-a-lifetime opportunity to get into the post-Soviet metals sector. But his hotel background would have been of little use to TWG. What TWG needed was someone with deep connections in the country’s political and business circles. The kind of people who had those connections in the Russia of the 1990s were either ex-KGB, or mobsters.

michael-cherney

Michael Cherney

Consider another pair of fixers the Reubens brought into TWG in 1992. They were the Cherney brothers, Lev and Michael, and they formed a 50-50 partnership with TWG. It was a successful partnership. With the Cherneys help, TWG grew by leaps and bounds. The problem for the Reubens was that Michael Cherney’s name soon became publicly linked to Russian organized crime groups. The Reubens quickly bought out Cherney’s share of TWG for $410 million.

vyacheslav-ivankov

Vyacheslav Ivankov

Swiss authorities in 1996 accused Michael Cherney of “drug trafficking, money laundering, fraud and sponsoring murder” on behalf of  a Russian organized crime group run by “V Ivankov.” This was the infamous Russian mob boss nicknamed “Yaponchik” who had settled in New York, where the FBI found him hiding out in Trump Tower and Trump’s New Jersey casino.

Michael Cherney has repeatedly denied these allegations, which he blames on his archenemy and former partner Oleg Deripaska, one of the wealthiest men in Russia. In 2008, the federal Swiss court exonerated him of the charges, but two years later, Spain issued an international arrest warrant for Michael Cherney’s arrest on money laundering charges.

Did Arif have links to the Russian Mafia? Felix Sater, who worked under Arif at Bayrock, seems to think so.

The Wall Street Journal reported that Sater and his attorney threatened to expose Arif’s past unless he paid Sater’s attorney fees. Sater warned of a possible lawsuit that would include details of Arif’s wrongdoing “in the post-Soviet metals business in Kazakhstan.”

In a personal memo, Sater was even more blunt: “The headlines will be, ‘The Kazakh Gangster and President Trump.'”

A High-Net Worth Individual

“The head of the family is my uncle Roustam Arif [sic],” Tevfik’s son Arif writes in 2013 in correspondence obtained by theblacksea.eu. “In our culture, the patriarch is usually the oldest member of the family. Roustam is my father’s oldest brother. Even though my father is a successful entrepreneur in his own right (hotels, construction and real estate), his younger brother Refik Arif is the principal figure in the main family business (commodities).”

In the mid-90s, Refik reportedly acquired control of the Aktyubinsk Chromium Chemicals Plant (ACCP) in Aktobe, in north-western Kazakhstan, near the border with Russia. Refik also established a highly profitable chemicals trading business.  And this is an important piece of the story, because the money for Bayrock, at least part of it, came through Kazakhstan.

Consider that for a moment. The Arifs managed to pool enough capital and influence to buy what turned out to be a highly lucrative chemical plant. How was this possible? What really happened in Kazakhstan in 1990s?

Around 1999, Refik Arif’s chemical trading business was generating so much cash that the family retained Hamels, a UK tax consultancy, to help structure their investments. On its website, Hamels describes its typical clients as “high net worth individuals seeking to minimize their respective tax burdens on current income or investment streams…”

In a 2011 memo, Hamels partner Zig Wilamowski wrote, “Mr. Refik Arif is one of four brothers who have over many years built up a substantial and profitable international business from the sale of chrome-based chemicals.” Williamowski said he was in a position to verify the “good origin” of the Arif family’s wealth. You can read the document here.

With the help of Hamels, the Arifs set up a network of shell companies, many of which were established in the Caribbean tax haven of the British Virgin Islands. These companies included Bennington Trade Assets Ltd., which owns property in the center of London and Merlin Trading Assets Ltd., which owns an executive jet. There are too many companies to name them all. Many are found in the Panama Papers leak of offshore companies founded by the Panamanian law firm Mossack Fonseca.

The real moneymaker for the family was Castello Global Ltd., which handled the profits from the chrome trading business. Here is a breakdown of Castello Global’s profits:

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So much money was pouring out of Kazakhstan that Tevfik Arif decided it was time to try something big. Really big.

He moved to New York and set out to do a real estate deal with the biggest and the best. So he set up offices of his new company Bayrock Group in Trump Tower, one floor below Trump’s own offices.

To be continued…

Sergey Kislyak Timeline

Sergey Kislyak

Sergey Kislyak, Russian ambassador to the United States, is emerging as a key point of contact for members for the Trump campaign and Russia, and a reminder of the president’s ties to Vladimir Putin.

CNN reports that Kislyak is known to US intelligence officials as a spy recruiter. And that’s why he’s a touchy subject for Trump’s people.

Here’s a timeline of what we know about contacts between the Trump campaign and Kislyak:

 

Trump Dossier Timeline

screen-shot-2017-01-11-at-102210For sourcing click following link:

Jun 18, 2013: Donald Trump tweets: “Do you think Putin will be going to The Miss Universe Pageant in November in Moscow – if so, will he become my new best friend?”

Nov 9, 2013 Trump visits Moscow for Miss Universe pageant.

Nov. 9, 2013 Interviewed in Moscow, Trump is asked by MSNBC whether he has a relationship with Vladimir Putin. “I do have a relationship, and I can tell you that he’s very interested in what we’re doing here today.”

Nov. 9, 2013 Trump tells Tass news service that he plans to build a Trump Tower in Moscow and was in negotiations with billionaire Aras Agarlov’s Crocus Group. During his Moscow visit, Trump also meets with Herman Gref, CEO of state-controlled Sberbank PJSC, Russia’s biggest bank, which is under US sanctions. Sberbank and Crocus sponsor the beauty contest.

Nov 12, 2013 Trump tells Real Estate Weekly that the pageant was a good networking opportunity. “The Russian market is attracted to me. I have a great relationship with many Russians, and almost all of the oligarchs were in the room.”

May 27, 2014 At National Press Club lunch, Trump says, “I was in Moscow recently and I spoke, indirectly and directly, with President Putin, who could not have been nicer.”

June 2016: Fusion GPS, a Washington research firm run by former journalists, hires Christopher Steele, a respected former MI6 officer who once served in Moscow, to gather opposition material on Donald Trump’s ties to Russia. Steele reportedly paid 200,000 pounds for his work.

June 20, 2016: Steele reports that Russian intelligence has videotapes of “perverted conduct” of Trump and prostitutes recorded in a Moscow hotel suite in 2013 during Miss Universe pageant. Trump’s behavior in Russia has “compromised him sufficiently to blackmail him.” Steele reports that Russian authorities have been “cultivating, supporting and assisting” Trump for years and he has accepted a regular flow of intelligence on his Democratic rivals.

Early July 2016: Steele, the former MI6 officer, acting on his own initiative, sends material he has gathered on Trump to the FBI.

July 7, 2016: Trump campaign adviser Carter Page travels to Moscow to give speech critical of U.S. policy. According to Reuters, Page declines to say whether he was planning to meet anyone from the Kremlin, the Russian government or Foreign Ministry during his visit.

July 19, 2016: Steele reports that Carter Page had held a secret meeting with Igor Sechin, head of the Rosneft state-owned oil company who is considered Vladimir Putin’s “defacto deputy.” Sechin and Page discuss lifting US sanctions against Russia. Sechin offered Page the “brokerage” on a 19 percent stake in Rosneft if sanctions lifted. According to Steele, Page also met Igor Divyekin, an internal affairs official with a background in intelligence, who warns Page that Moscow had kompromat on Trump

August, 2016: FBI asks Christopher Steele, the former MI6 officer, for all information in his possession and asked him to explain how the material had been gathered and to identify his sources.

August, 2016: A retired spy tells the BBC’s Paul Wood that he had been informed of videotapes of compromising material on Trump by the head of an East European intelligence agency.

Aug. 5, 2016: Steele’s memo identifies Dmitry Peskov, Kremlin spokesman, as the “chief protagonist” in Russia’s campaign to aid Trump and harm Clinton. Chief of staff Sergei Ivanov, longtime friend and top Putin lieutenant, said to be angry that Peskov’s team had gone too far.

Sept. 25, 2016: Carter Page sends letter to FBI Director James Comey saying that he is subject of a “witch hunt” and has not met with any “sanctioned official” in Russia in the past year.

Oct. 30, 2016 Sen. Harry Reid reveals in public letter that FBI Director James Comey possesses “explosive information of close ties and coordination between Donald Trump, his top advisors and the Russian government” and urges him to share it with the American people.

Oct. 31, 2016: Mother Jones interviews Christopher Steele, and publishes article, without naming him, that reveals existence of Steele’s memos, reporting in vague terms that Russian intelligence had “compromised” Trump during his visits to Moscow and could “blackmail him.”

Nov. 4, 2016: Newsweek reports that the Kremlin has both video and audio recordings of Trump in a kompromat file.

Nov. 8, 2016: Donald Trump elected president

Nov. 18, 2016: Sir Andrew Wood, a British ambassador to Russia, speaks with Sen. John McCain at a conference in Halifax, Canada. Wood tells McCain “how Mr Trump may find himself in a position where there could be an attempt to blackmail him with Kompromat and claims that there were audio and video tapes in existence.”

Dec. 7, 2016: Rosneft sells 19.5 percent ($11B) stake to Glencore Plc and Singapore’s sovereign wealth fund

Dec. 8, 2016: Carter Page revisits Moscow

Dec. 9, 2016: Sen. John McCain, who had also acquired Steele’s memos, turns them over to FBI Director James Comey.

Dec. 26, 2016: Oleg Erovinkin, a former general in the KGB and its successor the FSB, described as a key aide to Igor Sechin, found dead in the back of his car in Moscow.
2017

Jan. 6, 2017: Heads of US intelligence agencies brief PEOTUS and POTUS and leaders of House and Senate intelligence committees on Steele’s kompromat material on Trump. Kompromat material not included in public portion of report.

Jan. 10, 2017: CNN reveals that PEOTUS and POTUS were briefed on kompromat material and were given a two-page summary of allegations.

Jan. 10, 2017: Buzzfeed.com publishes 35 pages of Steele’s dossier. Included are allegations that Trump had a golden shower party with prostitutes in the Ritz Carlton hotel in 2013. Steele’s sources also say that Russia has an alliance with Trump that goes back several years.

Jan. 10, 2017: Donald Trump derides kompromat dossier as “FAKE NEWS!”

Jan. 11, 2017: DNI James Clapper says the U.S. Intelligence Community “has not made any judgement that the information in the document is reliable, and we did not rely on it in any way for our conclusions. However, part of our obligation is to ensure that policymakers are provided with the fullest possible picture of any matters that might affect national security.”

Jan. 11, 2017: Trump tweets, “Intelligence agencies should never have allowed this fake news to ‘leak’ into the public. One last shot at me. Are we living in Nazi Germany?”

Jan. 11, 2017: Former MI6 agent Christopher Steele, author of the Trump kompromat memos, goes into hiding.

Jan. 12, 2017: Yedioth Ahranoth reports that at post-election meeting US intelligence officials warned Israeli counterparts that Russia had “levers of pressure” on Donald Trump and that information passed to the White House could be relayed to Russia and Iran.

Jan. 15, 2017: The Guardian reports that UK intelligence officials have sought assurances from the CIA that the identity of British agents in Russia will be protected because of the Trump team’s closeness to Russia.

Jan. 17, 2017: At news conference, Vladimir Putin says kompromat file was a fake used to smear Trump. “Why would he run to a hotel to meet up with our girls of limited social responsibility? Although they are, of course, the best in the world. But I doubt that Trump fell for it.”

Jan. 20, 2017: Trump inaugurated as 45th US president

Jan. 23, 2017: Steve Hall, retired CIA chief of Russia operations, tells NPR that there is a “live question” now at the CIA about what to do if President Trump asks for the source of information on something that puts Vladimir Putin in a bad light.

Jan. 24, 2017: The Wall Street Journal identifies Sergei Millian, a Trump associate and supporter, as an indirect source for Christopher Steele’s dossier, including existence of compromising videotapes

Feb. 10, 2017: CNN reports that, for the first time, US investigators say they have corroborated some of the communications detailed in Steele’s kompromat dossier. Confirmations were made with SIGINT (foreign intercepts) and relate to conversations with foreign nationals, not the the salacious “golden showers” allegations in the dossier. Confirmations give intelligence officials “greater confidence” in Steele dossier.

Report: FSB Helped CIA Pinpoint Election Hacks

Two Russian FSB officers recently arrested on treason charges helped US intelligence agents pinpoint Russian hacking during the presidential election and spied for the CIA for seven years, according to a story on the Russian Rosbalt news agency.

Sergei Mikhailov, deputy director FSB’s Centre for Information Security (see my previous post), and Dmitri Dokuchayev, said to be an ex-hacker named “Forb” who joined the FSB under threat of prosecution, were paid to pass secret data, Rosbalt reported.

Ruslan Stoyanov (via Securelist.com)

Ruslan Stoyanov (via Securelist.com)

The FSB officers relayed their secrets to Ruslan Stoyanov, a manager from the cybersecurity and anti-virus company Kaspersky Lab and an unnamed representative of another cybersecurity company. The information was then transferred to “acquaintances abroad who worked closely with foreign special service.”

“This is not a one-off story, this activity was carried out for a minimum of seven years and caused substantial harm to the interests of the Russian Federation,” the source told Rosbalt.

Rosbalt reportedly has good connections to Russian intelligence. Its editor in chief,  Natalia Cherkesova, is the wife of Viktor Cherkesov, a former KGB operative who served under Vladimir Putin in the FSB. Sunday’s report in Rosbalt was picked up today by the reputable Times of London.

Stoyanov, Mikhailov, and Dokuchayev all face 20 year prison terms for treason.

The question of how this allegedly long-running spy operation was exposed remains unclear, and the timing of the arrests raises troubling questions given the Trump administration’s ties to Russia.

As noted in an earlier post, the U.S. Director of National Intelligence reported Jan. 6 that “further information has come to light since Election Day” that helped increase the U.S. intelligence community’s assessments of Russia’s motivations and goals in the election hacking.

One month later, Mikhailov was led out of an FSB with a bag over his head.  Again we ask: Is there a mole in the White House?

Rosbalt also reported that in an unrelated case, Mikhailov also gave a representative of the foreign intelligence services “counterintelligence materials.”

 

What Is Russia’s Centre for Information Security?

The New York Times reports on a series of arrests involving Russia’s FSB, the successor agency to the KGB that may be connected to the hacking of the 2016 U.S. Election.

According to the Times, one of those arrested, Sergei Mikhailov, was serving as deputy director FSB’s Centre for Information Security. He was arrested on a charge of treason. Earlier in the month, the head of the Centre, Andrei Gerasimov, was dismissed.

What is the FSB’s Centre for Information Security?

Some answers come from Jeffrey Carr, a security consultant out of Seattle who runs the consulting firm TAIA Global and published Inside Cyber Warfare. Carr describes the FSB’s Centre for Information Security (also known as Military Unit 64829) as the organization in charge of protecting Russia’s Internet.

“In sum, any Internet operation originating in Russia are almost certainly monitored and probably overseen by the FSB ISC,” Carr wrote in this analysis. “Current Russian press covers Russian intentions to implement further restrictions on RuNet to counter foreign attempts to wage “information warfare” against Russian and ideologically subvert the Russian population. Whatever final form the new restrictions take, the FSB ISC will be heavily involved.”

In his book, Inside Cyber War, Carr goes a bit further.  The Centre not only defends the Russian Internet (RuNet) it can also attack.
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Also arrested was Dmitry Dokuchayev, a former hacker going by the pseudonym Forb who agreed to work for the FSB in exchange for dropping charges of credit card fraud. In an interview with a Russian newspaper, (or here in the original Russian) Dokuchayev/Forb said he had carried out a successful cyberattack on the US government.
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I would be wary of any reports that claim the Centre hacked the U.S. election. Cyberwarfare like conventional warfare is a confusing picture, with many different groups carrying out different but overlapping missions.

Different FSB components are responsible for attacks outside Russia. One is the FSB’s 16th Center, also known by the Orwellian name of the FSB Center for Electronic Surveillance of Communications, according to TAIA Global Another is the FSB’s 18th Center. Another is the FSB’s Fifth Directorate. All three were blamed for cyberattacks and propaganda during the Russian invasion of the Crimean Peninsula.

And President Obama’s executive order imposing sanctions in response to the hacking of the 2016 U.S. Election names both the FSB and the GRU, the main intelligence directorate. It’s believed that the GRU hacks were passed along to Wikileaks and other media outlets during the election.

There’s no evidence yet that the Centre for Information Security had a hand in the 2016 U.S. election hacking, but with their complete command of the Russian Internet they almost certainly would have known about it.

 

 

San Diego’s Spook Shop

Along Interstate 5 in San Diego just south of the airport, lies a hulking building with blacked out windows and a roof that looks like a long silver saw blade. The site of a former B-24 factory during World War II, this giant piece of corrugated metal is the home of the Space and Naval Warfare Systems Command or SPAWAR.

I’ve long been interested in SPAWAR (pronounced spā-wôr) mostly because exactly what it does is a bit of a mystery. Its mission is “enabling information warfare superiority” for our Naval and military forces. Operating with a $2.5 billion budget, SPAWAR employs more than 2,000 scientists, specializing in areas such as cyberwarfare, information warfare and space systems. SPAWAR’s chief technology officer holds over 100 patents. I have no idea what that all means, but it sounds like they do some very interesting stuff.

About three years ago, in the midst of Edward Snowden’s revelations about the National Security Agency, I learned that the Defense Department’s Inspector General had conducted a Top Secret investigation into allegations involving SPAWAR’s “access to U.S. persons data.”

That phrase “U.S. persons data” caught my eye. Under federal law, our intelligence agencies cannot spy on U.S. persons, i.e. American citizens. The misuse of “U.S. persons data” is intelspeak for spying on Americans so I filed a request under the Freedom of Information Act for the report.

The 37-page heavily redacted report I received began as a whistleblower complaint filed in December 2006 by an unnamed government employee. This employee claimed he was mistreated and ultimately reassigned after reporting that SPAWAR had misused classified information involving U.S. persons, which is forbidden under U.S. law.

Of the two main allegations cited in the report, one remains classified under a FOIA b(1) exemption, which involves matters of national security. The whistleblower’s second allegation was that SPAWAR personnel had been in the words of the report “photographing U.S. persons.”

There are several allegations involving misuse of imagery at SPAWAR in the report, most of which are completely or partially redacted.

The only one that is readable is a charge that SPAWAR had been collecting data without notice, warrant or authority “on U.S. persons in federal parks located at Point Loma,” a hilly peninsula in San Diego.

This allegation involved a camera is mounted on a tower at SPAWAR’s command HQ, located on the southern tip of Point Loma, adjacent to Cabrillo National Monument, which is operated by the National Parks Service. The camera, which can be rotated 360 degrees, is used for calibration purposes by pointing it at different government radars, the IG’s investigation found. The video feed from the camera goes to a laboratory and is not stored.

The IG also looked for inappropriate images on another imagery system, details of which remain classified on national security grounds. The system was tested at a site on Point Loma overlooking San Diego Harbor on the USS Dolphin, a research submarine, after it had been repaired for fire damage.

Other allegations involving satellite imagery or other technologies are heavily redacted.

The investigation by the DoD’s Inspector General did not substantiate the whistleblower’s complaints that SPAWAR was mishandling intelligence and possibly compromising U.S. persons information. The Inspector General did, however, partially substantiate the allegation that SPAWAR had failed to move quickly to correct deficiencies in its handling of intelligence information. The whistleblower had not been subject to reprisals, the IG’s investigation found.

What the report makes clear is that SPAWAR is a spook shop. It does R&D work for various components of the U.S. intelligence community. Some of the imagery allegations involved an R&D project for the Office of Naval Intelligence. Officials with the National Geospatial-Intelligence Agency (NGA), the National Reconnaissance Agency (NRO), which runs spy satellites, and one agency whose name was blacked out were interview for the IG’s report.

San Diego FBI, Nidal Hasan, and the Webster Report

An independent commission headed by Judge William Webster, the former director of both the CIA and the FBI, has released its long-awaited report into the November 9, 2009 Fort Hood shootings. A copy of the report can be viewed here.

The report’s most damning is the refusal in May 2009, FBI officials in the Washington Field Office’s Joint Terrorism Task Force (JTTF)  to interview the Fort Hood shooter, Major Nidal Hasan, who was communicating with terrorist Anwar al-Awlaqi. The DC JTTF officials also decided not to interview Maj. Hasan’s Army superiors because that “might harm Hasan’s military career.”

This infuriated the FBI agents in San Diego who were handling the Awlaqi-Hasan investigation. Even after San Diego complained, Washington still refused to get off its ass.

According to the report, the a Defense Criminal Investigative Service agent in San Diego  handling the investigation told his Washington Field Office (WFO) counterpart that “upon receiving a lead like this one, San Diego would have conducted, at the least, an interview of the subject.” (See p. 60)

According to the San Diego DCIS agent, the JTTF agent in Washington replied something along the lines of:  “This is not SD [San Diego], it’s DC and WFO doesn’t go out and interview every Muslim guy who visits extremist websites.”

The San Diego FBI agent also recalled that the Washington agent indicated that this subject is “politically sensitive for WFO.”

Not surprisingly, the JTTF agent in DC doesn’t recall this conversation. The report doesn’t reveal whether the FBI agent(s) in the Washington Field Office (WFO) who refused to interview Major Hasan ecause it would have been “politically sensitive” received any disciplinary actions.

There is nothing about this in today’s print edition of The San Diego Union-Tribune, although Fred Willard’s porn theatre bust is there on p. 2. Remind me again why I subscribe to this newspaper?