Tagged: Michael Cohen

Who is Fima Shusterman?

“Due to ongoing threats against his family,” Michael Cohen announced yesterday that he was postponing his highly-anticipated congressional testimony.

The threats are coming from the White House where President Trump won’t stop talking about Michael Cohen’s father-in-law, a guy by the name of Fima Shusterman.

On a phone call January 12th with Fox News host Jeanine Pirro, the president of the United States launched into an extraordinary attack on Cohen’s father-in-law, a private citizen:

TRUMP: He should give information maybe on his father-in-law. Because that’s the one that people want to look. Because where does that money? That’s the money in the family. And I guess he didn’t want to talk about his father-in-law. Trying to get his sentence reduced. So it’s pretty sad. He is weak. And is very sad to watch a thing like that. I couldn’t care less.

PIRRO: What is his father-in-law’s name? 

TRUMP: I don’t know but you’ll find out and you’ll look into it. Because nobody knows what’s going on other there. 

The implication here is that Shusterman, a Ukrainian emigre, is some sort of Russian organized crime figure, although in typical Trump fashion he provides no evidence.

As readers of my book know, Trump knows that Shusterman is “the money” in the Cohen family because his business benefited from it.

Even with the spotlight the president has put on him, we still know very little about Michael Cohen’s father-in-law, Fima Shusterman. The only bit of insight comes from his 1993 testimony in federal court. So here goes.

Shusterman had pleaded guilty to the charge of conspiracy to defraud the United States. In exchange for leniency, he agreed to testify at the trial of Harold Wapnick, his accountant. Shusterman was sentenced to probation and fined $5,000.

On May 13, 1993, Shusterman took the witness stand in the court of Judge Carol Amon. Although he spoke some English, he had a translator present at his own request “because I do not understand English 100 percent.”

Q. Good morning, Mr. Shusterman.
A. Good morning.
Q. How old are you, sir?
A. 48.
Q. Are you married, Mr. Shusterman?
A. Yes, I am.
Q. And do you have any children, sir?
A. Yes, I have a daughter.
Q. Where were you born, Mr. Shusterman?
A. In the Soviet Union.
Q. When did you come to the United States, sir?
A. In May '75.
Q. And are you a citizen, Mr. Shusterman?
A. Yes, I am.
Q. Are you employed?
A. Yes.
Q. Where are you employed?
A. I'm employed as a manager with Future Knits.
Q. And are you a co-owner of of Future Knits, sir?
A. Yes, I am. 
Q. Who are your partners?
A. My partners are Shalva Botier and Edward Zubok.
Q. What business is Future Knits in?
A. This is a knitting factory.
Q. When was Future Knits established, sir?
A. I'm not sure. I think it was established in '81.
Q. Future Knits, sir, when was Future Knits established?
A. In 1988.
Q. And prior to Future Knits, sir, how were you employed?
A. I was employed with S&Z Fashions and LVA Corp.
Q. Were you a co-owner of those corporations?
A. Yes, I was. 
Q. And were your partners the same individuals as your partners
in Future Knits?
A. Yes, correct. 
Q. Were S&Z Fashions and LVA also in the knitting business?
A. Yes. 
Q. When did you join S&Z Fashions and LVA?
A. In July of '84. 
Q. Between years 1985 to 1988, were you involved with any other corporations
other than S&Z and LVA and Future Knits?
A. No. 
Q. Did you have an ownership or office position with any other corporation, sir?
A. Yes. I was secretary with Martha Cab Corporation, and Bar Trans Corporation.
Q. And, sir, is Barn Transportation with an "N" end, B-A-R-N?
A. Barn, B-A-R-N.
Q. Who is shareholder of Martha and Barn, sir?
A. My wife was.
Q. Are you an officer of those corporations?
A. Yes, I am.

Shusterman was also secretary of N.Y. Funky Taxi Corp. and New York Fulton Taxi Corp.

Today, the chief executive of N.Y. Funky Taxi, Martha Cab and Barn Trans is Michael Cohen, who married Mr. Shusterman’s daughter, Laura, a year following her father’s guilty plea and court appearance. Cohen owns and operates a fleet of cabs in New York and Chicago.

Note to my readers: This work costs me both time and money (in the case of this transcript quite a bit of money). I do this work for free in the hope that people will find it valuable. If you agree, the best way you can support this work is by purchasing my book, Trump/Russia, which has much more information on the president’s decades-long connection to Russian criminal money.

Click here to purchase Trump/Russia.

Q. Mr. Shusterman, have you been convicted of a crime?
A. Yes. 
Q. What crime were you convicted of, sir?
A. Conspiracy. 
Q. When were you convicted?
A. In March of this year, '93.
Q. How were you convicted, sir?
A. I pleaded guilty. 
Q. And, Mr. Shusterman, in connection with your guilty plea,
did you enter into an agreement with the government?
A. Yes.
Q. Would you tell the ladies and gentlemen of the jury, Mr. Shusterman,
what your understanding is of that agreement?
A. My understanding is that I obligated myself to fully, 100 percent, 
cooperate with the government. 
Q. And did the government agree to do anything in return, sir?
A. Yes, they did. 
Q. What did they agree to do, sir?
A. They would advise the judge about my full cooperation and 
about my help rendered in their investigations. 
Q. Mr. Shusterman, have you been sentenced yet?
A. No, not yet.
Q. Do you know what sentence you are facing, sir?
A. Yes.
Q. What is that, sir?
A. Five years in prison, and up to $250,000 in fines. 
Q. Sir, have any promises been made to you regarding your sentence?
A. No. 
Q. Do you know who will be sentencing you, Mr. Shusterman?
A. Yes, I do. 
Q. And who is that, sir?
A. Judge Amon. 
Q. Mr. Shusterman, you've testified that you pled guilty to 
the crime of conspiracy. Could you tell the ladies and gentlemen 
of the jury what is it that you did?
A. I concealed income from the state, and I cashed checks in the amounts 
that exceeded $10,000.
Q. Mr. Shusterman, what did you need this cash for, sir?
A. To operate our business. 

Shusterman goes on to say that from 1984 to 1988 he would regularly bring checks from his customers made out to S&Z Fashions, LVA, and Future Knits and leave them in Wapnick’s office.

A few days later, Shusterman would return and collect cash, always in amounts more than $10,000, in a paper bag or envelope. Wapnick would keep 3 percent for his services.

The total amount cashed with the Wapnicks was “somewhere between five and five and a half million dollars,” Shusterman testified.

Shusterman is then cross-examined by Harold Wapnick, who does a terrible job of representing himself with convoluted lines of questions.

However, he does stumble into a couple of things that are interesting in light of Trump’s claims that Shusterman is “the money in the family.”

Wapnick: Sir, you own a -- you own 40 percent of a 
40-machine factory, sir?
A. No. 
Q. What percentage do you own of a 40-machine factory, sir?
A. 15 percent as of today. 
Q. 15 percent. Would you say that the 15 percent value is in excess 
of a million dollars, sir?
A. If you pay me half a million I'll sell it to you gladly.
Q. Thank you. How about the -- do you own five -- 9 taxicab medallions? 
And are they worth about two million dollars?
The Court: Wait a minute. I don't think he gave an answer. 
Q. Are they worth about two million dollars, sir?
A. Did you say two million?
Q. Let's say $170,000 apiece, and we multiply it by nine, so, okay -- 
what's a half a million dollars among friends. Is it worth ---
The court: I take it you're withdrawing your last question. 
Wapnick: No I'm asking him is it worth a million and a half dollars, sir. 
Shusterman: Only on paper. 

A decade later, beginning in 2003, Shusterman made the first of three apartment purchases at Trump World Tower across from the United Nations building in Manhattan. By 2005, Shusterman had spent $7.6 million on Trump’s properties.

So where did this money come from and what did Trump know about it?

Felix Sater and Michael Cohen: Childhood Friends.

Somehow I missed this. Buried deep in this excellent New York magazine piece on Felix Sater is this tidbit:

Cohen, one of Trump’s personal attorneys, had known Sater since they were teenagers.

I’m curious how these two met. Sater was born in Russia and grew up in the Russian enclave of Brighton Beach as a Mobster’s son. Cohen grew up on Long Island as a doctor’s son. About the only thing the two seem to have in common is that they are both Jewish and roughly the same age.

Update: Sater told Talking Points Memo he knew Cohen through Cohen’s wife, Laura Shusterman:

Sater said he most clearly remembers the beginning of his relationship with Cohen from the time the former Trump Organization attorney began dating his now-wife, whom Sater describes as a girl from his neighborhood of Jewish Soviet expatriates. Cohen told TPM the pair had known each other before then, in their teenage years, and that he hadn’t yet begun dating his wife, reportedly a Ukrainian émigré, when he was in his teens.

Their friendship puts a different light of the chummy emails between the two men in 2015, after Trump announced he was running for president. In the emails, obtained by The New York Times, Sater promised to use his contacts in Russia to help Trump win.

“Our boy can become president of the USA and we can engineer it,” Sater wrote in an email. “I will get all of Putins team to buy in on this, I will manage this process.”

Cohen had been in negotiations with Sater and foreign investors to build a Trump Tower in Moscow from September 2015 through the end of January 2016. Trump announced he was running for president in June 2015.

In January 2016, when negotiations stalled, Cohen wrote to Putin’s spokesman, Dmitri S. asking for help.  But Mr. Cohen did not appear to have Peskov’s direct email.

That’s really strange. Why would he do this? As an attorney, he knows how important records are. It’s almost as if Cohen didn’t really expect a reply, but wanted to leave a trail.

And the White House has been referring questions about this whole matter to Cohen’s attorney, suggesting that this was Cohen’s deal, not the Trump Organization’s.

What Was Michael Cohen’s Role at the Trump Organization?

Michael Cohen

Michael D. Cohen

The New York Times is out with a front-page story today on Michael Cohen, Trump’s consigliere and personal attorney.

The article makes the point that Cohen has been sidelined because he’s been caught up in the Russia inquiry. He apparently was expecting to land a senior administration post in the White House, but nothing ever came of it.

But the article raises another point: What did Michael Cohen do at the Trump Organization?

He has declined to discuss the details of what he did at the company, and the Trump Organization did not respond to requests for comment. Some people who worked with him also declined to describe Mr. Cohen’s tenure, with several of them saying they feared being sued.

Whatever Cohen did, he wasn’t just reviewing contracts and documents. If you fear being sued for discussing Cohen’s job at the Trump Organization, something else was going on.

From May 2007 to the present, Cohen served as an executive vice president and special counsel to the Trump Organization, according to his LinkedIn profile.  He was and is unquestioningly loyal to his boss. Despite the attention he attracts from the Russia inquiry, Cohen remains Trump’s personal attorney.

Cohen is slated to appear before the House intelligence committee in its investigation of Trump’s ties to Russia. Cohen’s name appeared in a dossier prepared by former British MI6 officer Christopher Steele. The dossier stated that Cohen served as an intermediary between Trump and Russian operatives and Kremlin officials. Cohen has denied these links.

While the dossier may have gotten the details of Cohen’s meetings in Prague wrong, it may have struck upon a deeper truth: namely, that Cohen did serve as an intermediary between Trump and the unsavory characters the Donald encountered in his business.

Before joining forces with Trump, Cohen was involved in the New York City taxi business, set up businesses in the Ukraine, invested in a gambling cruise with a pair of Ukrainians, and he once deposited a $350,000 check from a Russian hockey player that he can’t explain and doesn’t remember receiving.

These ventures, reported by Buzzfeed’s Anthony Cormier who has been doggedly investigating Cohen, all have an unsavory element. When asked about them, Cohen  offers blanket denials, which he walks back when confronted with documents. But the unsavory elements in Cohen’s past obviously did not prevent him from getting a job with Trump; instead they may have helped him land it.

Every Mafia family has a consigliere. He (and it’s always a he) is a counselor to the boss, advising him on political relationships. He is traditionally not a member of the family and his role as an outsider is seen as allowing him to provide objective advice. Cohen may have played a similar role in the Trump Organization.

A search of news archives shows that Cohen appears mostly in the press as a Trump spokesman. In the 2012 campaign, Cohen launched a “Should Donald Run?” campaign. He later defended Trump in the press  from charges that he had fraudulently bilked students out of thousands of dollars in the scam known as Trump University. He is known for threatening reporters with lawsuits.

A few instances, however, offer a clue as to what Cohen’s job involved.

After he joined up with Trump, Cohen’s name first surfaced in a batch of articles about EnCap, a plan to build a golf course on New Jersey landfill. One article about an EnCap contractor arrested on money laundering charges references Cohen trying to get an attorney removed from the project.  (See “EnCap contractor hauled away; Arrested in unrelated money-laundering case,” The Record, 26 January 2008)

Nothing ever came of EnCap. The state pulled the plug on the project and EnCap filed for bankruptcy the next day. Trump kept a hand in the project, nevertheless.

The U.S. Attorney’s office, then led by future New Jersey Gov. Chris Christie, subpoenaed EnCap’s records. Cohen told a reporter the Trump Organization had not received a subpoena but he seemed to have insight into what exactly what interested investigators. (See “Feds Subpoena EnCap; Billing Records Sought,” The Record, 19 June 2008)

Cohen said those investigators appear to be focusing, in part, on the critical time frame from 2000 to 2005, when he said many key decisions were being negotiated.

“That’s when all the deals were cut,” he said, referring in part to the favorable loans from the Department of Environmental Protection and the Environmental Infrastructure Trust.

Another set of articles involve Cohen’s 2010 visit to Adjara in the former Soviet republic of Georgia. “Cohen has come to Adjara as he is interested in the investment climate in the region,” an article in the Black Sea Press. “Namely, Michael Cohen paid his attention to the ‘Project of Future’ which envisaged construction of comfortable hotels, entertaining complexes, modern buildings in Batumi.”

Trump signed up for a $250 million deal to build a 47-story residential tower in the Georgian Black Sea resort of Batumi, Work halted when Georgia’s then President Mikheil Saakashvili was ousted and fled in exile. His successor, Bidzina Ivanishvili, told reporters, “Trump did not invest in Georgia. It was kind of like a trick. They gave him money and they both played along, Saakashvili and Trump.” Construction eventually resumed, but Trump formally pulled out of the project shortly after his election to avoid what the Trump Organization said were conflicts of interest.

Trump pursued these kinds of deals with shady characters, whether in New Jersey or further away in places like Georgia or Azerbaijan. The potential rewards were huge. So were the risks.  He needed a tough, loyal outsider like Cohen to figure out who the players were, what were the risks, and how exposed Trump would be if the whole thing went sideways.

That’s a consigliere.

 

 

Why Did a Russian NHL Player Sue Trump’s Lawyer, Michael Cohen?

Vladimir Malakhov is a Russian-born retired professional hockey player. He was active in the NHL 1992 to 2006, playing for the New York Islanders, the Montreal Canadiens, and the New Jersey Devils.

In January of 1999, Malakhov wrote a check for $350,000 to Michael D. Cohen, Trump’s personal lawyer. The check was deposited — and then the money disappeared.

Screen Shot 2017-04-14 at 8.25.50 AM

What happened to the money and how this check came to be written to Michael Cohen was the subject of years of litigation in Circuit Court in Miami, Florida. (See Fomina v. Netscheret, 2006-001330-CA-01.)

Malakhov sued Cohen (/a/k/a “Michael D. Hacking”) in 2010 in Miami Circuit Court. (Malakov v. Cohen, 2010-14576-CA-03). I’ve embedded the lawsuit at the bottom of this post.

The story begins in late 1998 or early 1999, when Malakhov was living in Florida, and earning millions as a professional hockey player playing with the Montreal Canadiens.

One day, an acquaintance asked him for a large loan. The acquaintance was a woman named Julia Fomina. According to an affidavit filed by Malakhov’s agent, the money was intended not for Fomina but rather her boyfriend in Russia, Vitaly Buslaev. (For more on Buslaev’s background, see Yuri Felstinsky’s original article at the website Gordonua.com. There’s also a story out in Buzzfeed.)

Malakhov loaned $350,000 to Fomina and, on the advice of his attorney, secured the loan by having Fomina sign over a mortgage for her apartment on the 24th floor of Miami Beach condo tower.

For reasons that aren’t clear, Fomina instructed Malakhov’s wife to send the $350,000 loan to Michael Cohen. The check was issued in January 1999 to Cohen personally, not his law firm or many businesses, and deposited in Cohen’s Citibank trust account.

Sometime later, Fomina defaulted on her loan.  When Malakhov moved to foreclose on the condominium, Fomina swore under oath that she never received the $350,000 that had been sent to Cohen.

It took years before Cohen was finally deposed and asked what happened to the money. Cohen’s response: “I don’t recall.”  He insisted he didn’t know Malakhov, had no idea why the hockey player would write him such a huge check, had no records relating to the check, and had no clue what happened to the money.

A Miami judge accepted Cohen’s story and dismissed the case.

In deposition, Cohen speculated that one of the reasons why Malakhov might have sent him the check were his ties to Russians, including his business partner, the Ukrainian-born “Taxi King” Simon Garber. I’ve written previously about Cohen’s family ethanol business in Ukraine.

The Malakhov story connects to Trump in another roundabout way.

A few years before he wrote the check to Cohen, Malakhov was shaken down by a Russian mobster, according to testimony at a U.S. Senate hearing on Russian organized crime.

Malakhov, who at the time was playing for the New York Islanders, was approached in the National Restaurant in New York City’s Brighton Beach neighborhood. The man who demanded money from the hockey player worked for Vyacheslav Kirillovich Ivankov, one of the most powerful Russian Mafia bosses in America.

As I noted in an earlier post, Ivankov is one of several Mobsters who turned up in Trump Tower. Invakov also showed up Trump’s New Jersey casino, the Taj Mahal. Ivankov’s phone book included a working number for the Trump Organization’s Trump Tower residence, and a Trump Organization fax machine.

Ivankov was arrested in 1995 and sent to prison for extortion. After his release he returned to Russia where he was assassinated.

As for Malakhov, after he was shaken down, he spent the next months in fear, looking over his shoulder. His worries ended when he was traded to the Canadiens.

Michael Cohen’s Ukraine business

Michael Cohen

Michael Cohen

Josh Marshall of Talking Points Memo called my attention to the fact that President Trump’s personal lawyer, Michael Cohen, once founded an ethanol business in Ukraine.

As Marshall relates, Cohen’s ethanol business was revealed as a side note in a Feb. 19 story in The New York Times. The focus of the Times story was how Cohen became an intermediary for a Ukrainian “peace plan” pitched by a renegade Ukrainian politician named Andrii Artemenko.

And if that’s not strange enough, Artemenko’s meeting with Cohen also involved Felix Sater (whose shady Mafia connections were described in my previous post).

So what was Cohen’s ethanol business?

Some answers are found in a Feb. 24 story in the English-language daily Kyiv Post by Josh Kovensky.

Michael Cohen’s ethanol business initially involved an ethanol processing plant in the town of  Zolotonosha, southeast of Kyiv, the Ukrainian capital. To be clear, this plant was to produce bioethanol, the stuff that can power internal combustion engines, not the stuff that we like to drink (which has spawned a large black market in the Ukraine).

According to the Kyiv Post, Cohen visited the Ukraine “in the mid-2000s.”  His brother, Bryan, accompanied him on the trip.

Update: Cohen told Yahoo News’s Hunter Walker that he had visited Ukraine “twice,” in “either 2003 or 2004,” because his “brother’s father-in-law lives in Kiev.”

The timing of that Ukraine trip is interesting as it relates back to Artemenko’s peace plan. In an interview with strana.ua (see English translation here), Artemenko says  he has known Michael Cohen for years, ever since he founded the family ethanol business.

What Artemenko, a member of the Kyiv City Council at the time, had to do with the Zolotonosha plant isn’t clear. Update: The Cohen family has said Artemenko is full of shit.

A family ethanol business it was. The Cohens were brought into the Ukraine deal through Alex Oronov, a Ukranian-born American businessman who has invested in Ukrainian agriculture.  Michael Cohen’s brother, Bryan, is married to Oronov’s daughter. Cohen’s wife is also of Ukrainian descent.

According to the Kyiv Post:

The question of the extent of Cohens’ involvement comes down to the ownership of two companies: International Ethanol of Ukraine Ltd. and Ukrethanol LLC.

The Cohen brothers founded International Ethanol in April 2006 with Oronov, according to the New York State Corporate Registry. International Ethanol does not appear in Ukrainian registries as ever having done business here, despite the company’s name and timing of its founding.

Ukrethanol acquired half of [Alex Oronov’s business] Harvest Moon in 2008, and continues to manage part of Oronov’s Ukraine business, according to financial disclosures.

Ukrethanol is registered to an address on Long Island, care of Bryan Cohen. The address belongs to a law firm that Michael Cohen is reported to have formerly worked at.

screen-shot-2017-02-25-at-7-30-42-pmUkrethanol LLC was founded in July 2007, just months after Michael Cohen joined the Trump Organization. Prior to that Cohen was a partner at the New York law firm of Phillips Nizer.

Interestingly, the Kyiv Post notes, it’s not clear who provided financing for the plant. (The plant’s cost estimates vary from $90 million to 110 million euros.) According to this article in Vox Ukraine, the plant has been idle for several years, as expectations of state support never materialized.

The deal to build the plant was being put together by Viktor Toplov, a former Ukrainian deputy coal minster, who was on the board of a state-owned bank.  A Feb. 20 Kyiv Post story reports that Toplov acquired the ethanol plant in 2010.

There’s a interesting little note to this story. Ukrainian media reported that billionaire Vadim Novinksy was involved in the ethanol plant deal, although the Kyiv Post reported in its Feb. 20 story that it could not independently confirm that fact.

If there is a Novinsky connection to this story, that loops us back to Trump. Novinsky is a Russian who was granted Ukrainian citizenship in 2012 by former President Yanukovych.  Soon thereafter, Novinsky was elected to the Ukrainian parliament as member of Yanukovych’s Party of Regions. Paul Manafort, Trump’s former campaign manager, worked for the Party of Regions.

Exactly what role the Cohens played in the plant isn’t clear. Did the Cohen family provide some of the financing for the ethanol plant?  They sure seemed to be invested a lot of capital around that time. As Josh Marshall notes in a follow-up post, Michael Cohen his parents, his business partner, and his Ukrainian in-laws, purchased at least 11 apartment units in Trump buildings between 2001 and 2007.

In 2009, Oronov joined forces with a group of businessmen from Sweden and Ukraine to found Grain Alliance, a Ukraine farm operator. A Swedish property company bought out Harvest Moon’s agribusiness.

Grain Alliance’s annual report notes that it still does business with UkrEthanol, but it’s business has almost nothing to do with ethanol.

“When the customs procedures in Ukraine often are too complicated for the company’s U.S. suppliers of used equipment, purchases are made by a related party, UkrEthanol LLC, who has knowledge and experience to handle customs declaration,” the annual report states.