Wednesday, November 20, 2019

Bombshell Report Alleges Russian Oligarch Laundered $860 Million Via Swedbank

The money-laundering scandal sweeping across the Scandinavian banking system reached another milestone on Wednesday. The Organized Crime and Corruption Reporting Project, an organization that helped break the story, has dropped another bombshell report about Sweden's Swedbank.
The report describes how one Russian oligarch and ex-government minister managed to hide his wealth via a network of 70 shell companies situated all over the world. The companies had one thing in common: They all had accounts with Swedbank's Estonian branch.
The oligarch in question was former energy magnate Mikhail Abyzov, who was accused of being part of Russian organized crime a few years back, and allegedly used his network of shell companies to shuffle millions of dollars stolen from business partnerships and other businesses safely to Europe.
The report goes on to accuse Swedbank of tacitly aiding Abyzov via mysterious insider employees within the bank who seemed to help his companies avoid the bank's due diligence. Over the years, roughly $860 million flowed into these accounts, and only $770 million flowed out.
Since the questionable transactions involved dollars, it's possible that the Treasury could decide to investigate after reading the OCCRP report. That could create problems for Swedbank.
But the bank said on Wednesday that it was not aware of any violations of US sanctions on Russia, like the above-mentioned report alleged, and said that it would continue to investigate accusations of money laundering made by these reporters.
In a statement, the bank said it is unaware of any violations.
"The Bank is not aware of any OFAC (Office of Foreign Asset Control) violations arising out of the continuing internal investigation," Swedbank said in a statement.
The bank did, however, leave open the possibility that an employee acting as an insider could have done something wrong.
"How individual employees have acted in different situations is also part of the ongoing internal investigation," Swedbank said. "If there has been unethical behavior as described in Uppdrag Granskning, we should of course get to the bottom of it."
"It is a good thing that the bank is being investigated and I welcome Uppdrag Granskning’s reporting,” CEO Jens Henriksson added.
The bank's internal investigation, which has been ongoing for some time now, is expected to wrap early next year.

Ukrainian Indictment Claims $7.4 Billion Obama-Linked Laundering, Puts Biden Group Take At $16.5 Million

An indictment drawn up by Ukraine's Office of the Prosecutor General against Burisma owner Nikolai Zlochevsky claims that Hunter Biden and his partners received $16.5 million for their 'services' - according to Ukrainian MP Alexander Dubinsky of the ruling Servant of the People Party.
Dubinsky made the claim in a Wednesday press conference, citing materials from an investigation into Zlochevsky and Burisma.
"Zlochevsky was charged with this new accusation by the Office of the Prosecutor General but the press ignored it," said the MP. "It was issued on November 14."
"The son of Vice-President Joe Biden was receiving payment for his services, with money raised through criminal means and money laundering," he then said, adding "Biden received money that did not come from the company’s successful operation but rather from money stolen from citizens."
According to Dubinsky, Hunter Biden's income from Burisma is a "link that reveals how money is siphoned [from Ukraine]," and how Biden is just one link in the chain of Zlochevsky's money laundering operation which included politicians from the previous Yanukovich administration who continued their schemes under his successor, President Pyotr Poroshenko.
"We will reveal the information about the financial pyramid scheme that was created in Ukraine and developed by everyone beginning with Yanukovich and later by Poroshenko. This system is still working under the guidance of the current managerial board of the National Bank, ensuring that money flows in the interest of people who stole millions of dollars, took it offshore and bought Ukrainian public bonds turning them into the Ukrainian sovereign debt," said Dubinsky, adding that "in both cases of Yanukovich and Poroshenko, Ms. Gontareva and companies she controls were investing the stolen funds."
Franklin Templeton named
According to Interfax-Ukraine, MP Andriy Derkach announced at the same press conference that deputies have received new materials from investigative journalists alleging that the 'family' of ex-President Yanukovych funneled $7.4 billion through American investment firm Franklin Templeton Investments, which they claim have connections to the US Democratic party."
"Last week, November 14, the Prosecutor General's Office (PGO), unnoticed by the media, announced a new suspicion to the notorious owner of Burisma, ex-Ecology Minister Zlochevsky. According to the suspicion, the Yanukovych family is suspected, in particular, with legalizing (laundering) of criminally obtained income through Franklin Templeton Investments, an investment fund carrying out purchases of external government loan bonds totaling $7.4 billion," said Derkach, adding that the money was criminally obtained and invested in the purchase of Ukrainian debt in 2013 - 2014.
"The son of Templeton's founder, John Templeton Jr., was one of President Obama's major campaign donors. Another fund-related character is Thomas Donilon. Managing Director of BlackRock Investment Institute, shareholder Franklin Templeton Investments, which has the largest share in the fund. It is noteworthy that he previously was Obama's national security advisor," Derkach added.
Derkach then demanded "President Zelensky must pick up the phone, dial Trump, ask for help and cooperation in the fight against corruption and fly to Washington. The issue of combating international corruption in Ukraine with the participation of citizens, businessmen and U.S. officials should become a key during the meeting of the two presidents."

Tuesday, November 19, 2019

Mike Novogratz Launches New Funds To Bring Bitcoin To America's Top 1%

Mike Novogratz is still saddled with hundreds of millions of dollars in paper losses on his crypto portfolio, but he hasn't given up on the space yet. The former Goldman executive's Galaxy Digital Holding is launching two new funds, both aimed at accredited investors with little experience in crypto (something to help justify the higher fees), according to Bloomberg.
The billionaire investor is reportedly planning to target "the wealth of America" - that is the 'mass affluent' of Americans who have between $2 million and $25 million in assets (and the firms that represent them) who would like to diversify their portfolios, and those with even more wealth to invest. The vast majority of Americans between the ages of 50 and 80 stayed on the sidelines during the crypto bull run, Novogratz claims. And it's time somebody showed them a way in.
According to BBG, Novogratz isn't wrong. Bitcoin investors have always skewed younger and more tech savvy. Galaxy is hoping to convince everyone else that bitcoin is a worthwhile long-term hold, at a price point that's lower than the Grayscale Bitcoin Trust, pretty much the only tried-and-tested fund that offers exposure to bitcoin at a markup.
Galaxy is trying to design a fund that can "plug into existing infrastructure," which we imagine means fit nicely into the sales pipeline controlled by financial advisors and the big wirehouses.
Here's what Galaxy's head of asset management told BBG.
"The existing landscape for accessing Bitcoin is incomplete," Steve Kurz, head of asset management at Galaxy Digital, said in a phone interview. "We are trying to offer secure service providers, low fees, simple access to Bitcoin. We wanted to create something that could plug into the existing infrastructure."
Still, the stakes for the Galaxy Bitcoin Fund are pretty high. Galaxy's bitcoin fund requires a $25,000 minimum investment and funds can only be withdrawn quarterly. The other fund, the Galaxy Institutional Bitcoin Fund has weekly withdrawal periods and a higher initial buy-in. The funds are being seeded with Galaxy's money (whatever's left of it) and some of Galaxy's initial investors participated as well.
Novogratz believes that more traditional financial services firms will offer bitcoin services in the next 12 months, and hopes he's getting a head start.
With gold prices on the upswing, Novo hopes his new bitcoin funds might benefit from the flight-to-safety momentum that's emerged as of late.
"You are seeing Bitcoin way outperform other coins right now, and I think that will continue until these coins start to get used for things," Novogratz said. "You also get more credentialed people - there are probably 20 billionaires I could name that made their money outside of crypto and are in crypto now. Every speculative asset needs people to tell the story, and people are buying the story."
Novo has been foretelling the mainstream wealth advisors' eventual embrace of bitcoin for years now. And now he's putting his money where his mouth is. But if he can't win over the big institutional clients - endowments & etc. - this could be another major money loser for Novo.

Thursday, November 14, 2019

Leaked Bank Records Confirm Burisma-Biden Payments To Morgan Stanley Account

Documents allegedly leaked by the Ukrainian General Prosecutor's office to CD Media have shed light on payments from Burisma Holdings to Rosemont Seneca Bohai LLC, a corporation controlled by Hunter Biden partner (and fellow former Burisma board member) Devon Archer.
Devon Archer (far left) is pictured with Joe and Hunter Biden. (Screenshot from Twitter)
Archer was Yale roommates with John Kerry's stepson Chris Heinz - the two of whom opened investment firm Rosemont Capital with Joe Biden's son, Hunter. Rosemont Capital is the parent company of Rosemont Seneca Partners, LLC - the entity which receive the Burisma payments and in turn aid Biden.
The newly leaked records show 45 payments between November 2014 and November 2015 totaling $3.5 million, mostly in increments of $83,333.33. The payments correspond to Morgan Stanley bank records the New York Times reported on earlier this year - submitted as evidence in a case against Archer who was convicted in a scheme to defraud pension funds and an Indian tribe of tens of millions of dollars. Archer's conviction was overturned in November by a judge who felt that he may not have willingly participated in the scheme.
What's more, there are several payments from "Wirelogic Technology AS" and "Digitex Organization LLP" in the amounts of 366,015 EUR and $1,964,375 US based on credit agreements - while $1,150,000 went to Devon Archer and Hunter Biden.
Via CD Media
Looking through the Rosemont Seneca Bohai bank records reveals that it was essentially a slush fund used for payments to Biden, expensive toys, an investment in the ill-fated Indian tribe scheme, and other miscellaneous expenses.
$104,000 to Mecum Auction Inc.
$142,000 to Schneider Nelson Motor, $30,000 to Hampton Watercraft & Marine
$1,580 in toll road violations
Indian Scheme
On September 25, 2014 a wire of $15,000,000 was received from Florida attorney, Clifford A Wolff. It was subsequently used to buy a $15 million bond from Wakpamni Town Center - the scheme linked to Archer's overturned conviction.
September 2014 statement
October 2014 statement
November 2014 statement
It is unclear why Rosemont Seneca had so much skin in the game. Via the Wall Street Journal:
Hunter Biden’s work in Ukraine and China has attracted criticism from President Trump and other Republicans. In an unrelated fraud case from last year, his name was invoked as a selling point in transactions that turned out to be fraudulent, although Mr. Biden‘s lawyer said his client knew nothing about it.

The case involved a $60 million securities fraud based on bonds issued by an economic-development company affiliated with a Native American tribe in South Dakota, according to prosecutors’ statements in a federal trial in Manhattan last year.
The proceeds were supposed to be used to build a distribution center and other projects, but were instead diverted for the personal use of Jason Galanis, prosecutors said prosecutors said, describing him as the scheme’s ringleader. Mr. Galanis and others also sought to use the bonds to advance a strategy that involved buying up financial firms to merge them into a larger one called Burnham Financial Group, in a deal called a “roll up,” according to prosecutors.
You can flip through the rest of Rosemont's bank statements below: