Category Archives: FBI

Hey Amb. Yovanovitch and Adam Schiff, Call Holding Line 3

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Remember the accusations during the Trump impeachment trial that Ukraine had cleaned up corruption? President Trump withheld aid for a couple of very legitimate reasons including corruption in the Ukraine military, corruption in the banking system and money-laundering. The Democrats continued to place guilt of dying Ukrainians because of the military conflict with Russia in the lap of President Trump. Then there was that pesky Internet Research Agency in St. Petersburg that spread propaganda across the world.

Ladies and gentlemen…it is still happening over there…where is the media? Where is Shifty Schiff and Nasty Nadler? Maria Yovanovitch is retired but gotta wonder what she knew.

Anyway read on….this is yet but only part of what continues to go on in Ukraine…Rudy Giuliani is working many other channels.

Hat tip to the REAL investigative reporters on the case…well done.

Image result for milton group kiev source

Luxury cars line the parking lot of the upscale Mandarin Plaza mall in Kyiv, while their well-heeled owners flaunt their wealth in its jewellery and designer clothes stores.

But hidden on its upper floors, protected by armed guards and under the constant surveillance of security cameras, a very different product is being sold.

Sitting elbow-to-elbow under fluorescent lights, a multi-lingual army of call center staff hawk get-rich-quick dreams across the world in the form of cryptocurrency and stock investments for a company called Milton Group.

Now, a cache of documents handed to the Swedish daily Dagens Nyheter by a whistleblower from inside the call center, and shared with OCCRP, exposes the inner workings of this type of fraud: an old-fashioned boiler-room scam that leverages the power of social media to operate on a global scale.

Armed with a list of over 1,000 people targeted by the call center, reporters from 21 countries and dozens of media outlets spoke to more than 180 victims, revealing a trail of ruined lives from Sweden’s Arctic Circle to the Ecuadorian Amazon, passing through small industrial towns in the Balkans and major world cities like London and Sydney.

The stories were strikingly similar. Many first came into contact with the scam through Facebook ads promising remarkable returns on investments. After entering their contact details to find out more, victims would be deluged with high-pressure sales calls. They would make a small “investment” that quickly yielded impressive — but fake — profits. But requests to withdraw the full funds were not honored.

Those worst affected were preyed upon by the call center’s “retention” desk, whose job was to conjure up new ways to extract more money, often through brutal psychological pressure. Some were harassed into taking out huge loans, threatened by forged letters from UK financial regulators demanding taxes, or contacted by fake lawyers offering to help get their money back — for yet another fee. In the most extreme cases, Milton Group’s retention specialists would convince victims to install software on their computers that allowed the scammers to control them remotely, and steal more money in the process. Some lost more than $200,000.

The victims, fooled by foreign names and addresses, and assurances of sky-high returns, believed they were on the phone with a legitimate investment business based in Western Europe. They had no inkling that the people on the other end of the line were largely young Ukrainians or Middle Eastern and African migrants in Kyiv.

Ukrainian Milton Group scheme source

Some tried to report their losses to police in their countries, but law enforcement largely failed to connect the dots. Cyber-crime units in multiple countries affected by the call center, including Spain and Italy, told OCCRP and its partners that they were aware of such cross-border frauds, but that they are hard to detect, often go unreported, and require cooperation between law enforcement bodies across many jurisdictions.

However, Swedish authorities have now opened an investigation based on the whistleblower’s extensive evidence, and have been in touch with Europol about the allegations.

“This company what they do, everything is fake,” said Alexey, the whistleblower. (His real name cannot be used to protect his safety.) “They just steal money from people.”

He said staff were told the Kyiv center took in a massive 65 million euros in sales in 2019. To celebrate, the company’s leaders threw a lavish New Year’s party themed around the novel “The Great Gatsby,” about a Jazz-Age bootlegger and con artist. Under neon lights, hundreds of Milton staffers watched contortionists and fire-dancers perform, and were awarded prizes, including cars, cash, and free lodging, for especially good salesmanship.

Milton is apparently tied to other call centers in Albania, Georgia, and North Macedonia employing hundreds more staff.

While it is impossible to determine whether every investment that passed through the Kyiv center was fraudulent, reporters from DN and across OCCRP’s network spoke to more than 180 victims listed in Milton’s client database who confirmed they had lost their money in investment scams. A few had been able to withdraw some funds, likely in an attempt to encourage further investments, or remained hopeful they would be able to cash out their “earnings” one day.

The supposed investments were made by transferring funds through Western Union, bank accounts, credit cards, and cryptocurrencies. Milton salespeople received a higher commission if they could convince their clients to pay in bitcoins and other cryptocurrencies, since they are harder to trace. Many of the bank-to-bank transfers were routed through the private accounts of individuals with a UK financial company, with clear instructions not to indicate the money was for investing.

In many cases identified by OCCRP, online credit-card payments were handled by a Cyprus-based company called Naspay, which bills itself as a “state-of-the-art payment gateway” and is owned by David Todua — the same Georgian-Israeli man the whistleblower identified to law enforcement as the person behind Milton Group. (Todua vigorously denies holding any “formal or informal position” in the company, although he conceded that he had attended Milton Group’s New Year’s party as a guest. He also said that Naspay does not process payments, but merely “transfers information” between websites that accept payments and financial institutions. OCCRP did not find evidence Todua has any ownership of Milton.)

After their initial investments, some victims were told they needed to send additional fees in cash to individuals in far-flung countries such as Colombia and Uganda rather than company bank accounts.

Leif Nixon, a Swedish cryptocurrency expert who helps law enforcement investigate bitcoin-related crime, analyzed the bitcoin addresses used by Milton Group to accept payments from its customers. He said the set-up did not appear to be that of a legitimate operator.

He noted several indications that clients’ money was not being invested as promised, including the fact that many different people were told to send their bitcoins to the same few addresses. Clients were also given different addresses each time they made a payment.

“It’s like opening a bank account, but you don’t get an account number; instead, for every deposit you make you get a different account number,” Nixon explained.

Ultimately, he said, $5.9 million in bitcoins from seven of Milton Group’s addresses disappeared into East Asian exchanges in 2019.

“I can’t see why a legitimate operation would make these kinds of transactions,” he said. “It doesn’t make any sense.”

Call center staff were well aware that their job was to steal, the whistleblower says. Alexey told DN that on one of his first days at Milton, the sales manager joked that even when she was as young as six, she dreamed of being a “motherfucker and stealing people’s money.”

At a training session for new staff at a Tbilisi call center linked to the Milton Group, attended by an undercover reporter last month, a trainer explained that the company’s goal was for customers “to lose their money in a realistic way.” Asked why, she laughed: “It’s naive to ask, to be honest. When they lose the money, it stays with us.”

An internal customer database reviewed by reporters is laced with expletives about “fucking” clients out of money, as well as highlighting their vulnerabilities and how they might best be targeted. In one note from October 2019, a Milton staff member wrote of a 67-year-old Swedish woman: “Sold her home to pay, no money, crying.”

That woman, reached by Dagens Nyheter in a rural part of central Sweden, told journalists she was tricked into investing over $100,000 by Milton staff who took out loans on her behalf.

She, like many other victims, was initially sucked in by the illusion that she was making huge profits: “You become hypnotized and brainwashed.”

But when she wanted to withdraw her supposed earnings, “they disappeared.” Today she cannot afford to buy food or pay her rent. “I have nothing to live for,” she said. While Milton Group’s fake investments have brought its victims financial ruin, the picture is very different for the firm’s alleged managers.

A review of their social media profiles shows that they have a penchant for expensive cars, foreign holidays, and guns. Some also have high-level political connections.

The CEO of Milton Group is Jacob Keselman, who declares himself “the Wolf of Kiev” on his Instagram account, a nod to “The Wolf of Wall Street,” the Hollywood film about a notorious penny-stock scammer. His social media profiles are replete with photos of luxury cars, foreign holidays, and the occasional gun. In one photo he can be seen working in a room with a spectacular view of the Eiffel Tower. He writes: “The one who loves his job is truly happy.”

OCCRP could not obtain official information about Keselman’s national origin, but on his LinkedIn profile he writes that his native language is Russian, he attended university in Kyiv, and he did two stints in sales in Israel before joining Milton Group.

Contacted for comment, Keselman denied that Milton Group had defrauded anyone. “You know how it is working, investment and forex brands … a lot of clients lose money because they don’t understand how it’s working,” he said. He went on to claim that Milton only provided IT support for companies selling investments. He did not respond to follow-up questions.

David Todua, a 38-year-old Georgian-born Israeli citizen, is a frequent visitor to the call center office in Mandarin Plaza, where according to Alexey the staff knew him as one of Milton Group’s owners.

Alexey said he saw Todua there at least six times, including once in November 2019, when he congratulated the staff on their performance and said Milton had brought in $50 million that year to date. The whistleblower said Todua always travelled with multiple bodyguards.

No official documents connect Todua to the scam call center, which on paper is owned by a different Georgian, Irakli Dadivadze. OCCRP was unable to track down any information about him.

However, Todua does own Naspay, a Cyprus-based payment platform through which Milton processes many of its “investments,” internal documents show.

At the firm’s New Year’s party, a man named David was called up to the stage by Keselman, the CEO, identified as the company’s “father,” and presented with a cake with three candles in it, representing the three years Milton Group had been in operation. The whistleblower identified this “father” as David Todua.

“In December, the company turned three years old,” Keselman said, according to an audio recording of the event obtained by OCCRP. “We are big kids, and our father is proud of us, while we are proud of him. And firstly [we] want to say a big thank you, David. And we want to give a cake, because what birthday is without a cake? And David will blow out the candle today.”

Todua told OCCRP he had been at the firm’s New Year’s party as a guest of Keselman, but denied holding any role in the company. “I am not father of any company, I am a proud father of 5 children,” he said.

On Instagram, he calls himself david_todua_007 and poses with a golden Kalashnikov, shoots with a sniper rifle, celebrates birthdays with a champagne tower, and posts photos of expensive cars parked outside his home. (“Hunting is indeed one of my hobbies,” he told OCCRP.)

He also has business ties with a surprising number of politicians from several countries, including ministers and other figures from the United National Movement party, which governed Georgia under President Mikheil Saakashvili for almost a decade until 2012. Saakashvili later became a Ukrainian citizen and forged a political career in the country.

Little is known about Todua’s life in Israel, where he migrated with his family in 1993, but court records and posts from his social media accounts show that he lived until recently in a villa near Tel Aviv. Today he lives in Cyprus.

In Albania, which boasts a 400-strong call center that also appears to be linked to Milton Group, the company operating it is owned by an adviser to a senior minister.

?The Georgian Connections

Although David Todua’s family left Georgia for Israel when he was just 11, as an adult he has ties to a surprising number of prominent political figures from his home country.

Most notably, his business partner in two Ukrainian companies is Davit Kezerashvili, an ex-defense minister and former chief of Georgia’s financial police under Saakashvili.

Todua and Kezerashivili co-own Project Partners, a real-estate and construction firm that is based out of a neighboring office building in Kyiv as Milton Group. Its head is Gia Getsadze, a former deputy justice minister in both Georgia and Ukraine.

Project Partners, in turn, co-owns a construction and civil engineering firm, Elitekomfortbud, with another former Georgian official, Petre Tsiskarishvili, a minister of agriculture under Saakashvili and a former leader of his United National Movement party.

Kezerashvili was charged in 2013 with accepting some $12 million in bribes to turn a blind eye to massive smuggling of alcohol from Ukraine to Georgia. He was ultimately cleared of the charges, which he says were politically motivated, but continues to live outside Georgia.

OCCRP has found no evidence that any of the former ministers are involved in the call center. In an email, Kezerashvili said he had never heard of Milton Group and had no knowledge of its activities, but confirmed that he was a business partner of Todua.

“You Will Never Regret This Decision”

Milton Group’s Kyiv call center does not appear unusual at first glance: Hundreds of phone sellers sit side by side, headsets on, using modern telephone and customer management systems.

Workers make up to 300 calls a day to clients around the world in an attempt to reach their monthly sales targets and secure bonuses.

The center is split into different sales desks by language — including Russian, English, Italian, and Spanish — each targeting their own areas of the world. Sellers use so-called “stage names” to build trust with the person on the other end of the call: A Senegalese man on the German desk goes by the name “Todd Kaiser,” while a Ukrainian woman whose real name is Daria calls herself “Diana Swan” or “Kira Lively.”

But undercover footage from inside Mandarin Plaza, as well as leaked internal documents, confirm that Milton was no ordinary call center.”

It is protected by burly guards and personal mobile phones are forbidden.

On the walls, next to posters of sports cars, a whiteboard sets out sellers’ monthly targets: $40,000 for the Russian market; $60,000 for Spanish, and $100,000 for those working the English-speaking desk.

The staffers in the sales department are provided with a set of notes explaining exactly how to target “clients” by nationality.

Scandinavians, the notes say, are mostly “old people and they really need someone to talk to.”

People from the UK, Australia, and New Zealand, on the other hand, like to believe they know everything and are certain that their countries are the best in the world, so call center workers are advised to pump them up.

“The only way to Handle [sic] such people is not to argue with them on whatever direction they take and make them feel that they are intelligent,” the notes explain.

“Later talk to them about how important the financial market has become because of great countries like Australia, UK, and New Zealand.”

“You will never regret this decision” is another line suggested to entice customers.

Those targeted by Milton Group are offered the chance to invest in cryptocurrency, stocks, or foreign currencies through a variety of different “brands,” all of which have generic-sounding names and similar websites, and are moved out of the rotation over time. Recently, Milton Group’s brands have included CryptoMB, Cryptobase, and VetoroBanc. All have been subject to recent investor warnings from regulators in the UK, Italy, and Spain.

The precise relationship between the call center and the brands they market is not always clear. Brands are sometimes not associated with any legal entity; when they are, they hide behind offshore secrecy. CryptoMB and VetoroBanc are run by offshore firms in the Marshall Islands and St. Vincent & Grenadines, respectively, while OCCRP could find no evidence that Cryptobase was tied to any specific company.

Alexey told journalists that the supposed VetoroBanc was entirely fabricated inside the Milton offices, with the name chosen by the Italian retention manager because it sounded “like one of the Italian banks.” The VetoroBanc website uses stock images for its staff that appear to have been taken from the internet. “Sylvia Moreno,” a supposed market analyst, is in fact an American pediatrician.

Alexey explained that staff had no specific expertise in financial products, but were carefully taught to sell “emotions.”

“It doesn’t matter which emotions, positive or negative: You can sell those fake products if people are really thinking about that,” he explained.

Clients were often shown huge profits to encourage them to invest further funds, but the money was always just numbers on a screen, the whistleblower explained. The only time victims were allowed to receive any of their funds back was in order to encourage an even bigger investment.

The most promising — and vulnerable — investors were passed on to the “retention team,” where the top salesmen work.

Their job is to “squeeze the money from the clients to the last cent,” Alexey explained, pushing them to borrow money and sell their cars and apartments. In one case, he said, a heavily pregnant Russian woman was convinced to hand over the small nest egg she had scraped together for her baby.

The most prolific and ingenious scammer at Milton Group is a man on the retention team who tells prospective investors his name is “William Bradley.”

In fact, he is a young Iranian who uses images of well-known US salesman and motivational speaker Marc Wayshak — who dubs himself “America’s sales strategist” — to disguise his identity on video calls.

OCCRP was unable to verify his real name, but at work and on social media he goes by “Hamze” and speaks fluent Farsi. Alexey claimed he takes in a massive $450,000 a month.

The call center’s internal customer database tracks how much each client has “invested,” as well as the potential to extract more money from them. Comments seen by OCCRP are laced with profanities and details of clients’ vulnerabilities.

One reads: “I saw 800 EUR in his bank and he is sick, he have problem and he told me I want someone fuck me and I said Foster [another call center operator] will fuck you.”

Another reads: “Getting fucked every month for at least 1000 EUR. Gets pension on the 20th/works every tuesday.”

Notes from the Milton Group’s internal customer database describing the situation of one of their victims, Östen Morian. Credit: Alexander Mahmoud/DN

Of another man, a call center staffer wrote: “Very Old man/pushed him to get the commission payment, hoping he can sort that out today, should call back at 3pm Sweden time.”

A month later, another note appears: “He is at his friend’s home because he doesn’t have money for food. Call him back on Monday, lost 400 k.”

That client was 75-year-old Östen Morian, a retired carpenter who lives close to the Arctic Circle in remote northern Sweden.

Contacted by DN, Morian confirmed he had lost around 400,000 Swedish krona (about $41,000) to the scammers after taking out loans, at 39 percent interest, to make what turned out to be fake investments. He was left heavily indebted.

“I don’t know what I can do,” he said. “Wait to die only.”

Go here for citations, photos and video

 

Govt Report on Prevention of Nationwide Cyber Catastrophe

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A good first step for sure, however there needs to be a government-wide decision on cyber attacks being an act of war and how to respond.

***

The Cyberspace Solarium Commission’s proposes a strategy of layered cyber deterrence. Our report consists of over 80 recommendations to implement the strategy. These recommendations are organized into 6 pillars:
  1. Reform the U.S. Government’s Structure and Organization for Cyberspace.
  2. Strengthen Norms and Non-Military Tools.
  3. Promote National Resilience.
  4. Reshape the Cyber Ecosystem.
  5. Operationalize Cybersecurity Collaboration with the Private Sector.
  6. Preserve and Employ the Military Instrument of National Power.

Click here to download the full report.

A much-anticipated government report aimed at defending the nation against cyber threats in the years to come opens with a bleak preview of what could happen if critical systems were brought down.

“The water in the Potomac still has that red tint from where the treatment plants upstream were hacked, their automated systems tricked into flushing out the wrong mix of chemicals,” the Cyberspace Solarium Commission wrote in the opening lines of its report.

“By comparison, the water in the Lincoln Memorial Reflecting Pool has a purple glint to it. They’ve pumped out the floodwaters that covered Washington’s low-lying areas after the region’s reservoirs were hit in a cascade of sensor hacks,” it continues.

So begins the report two years in the making from a congressionally mandated commission made up of lawmakers and top Trump administration officials, pointing to the vulnerabilities involved with critical systems being hooked up to the internet.

The report, which includes more than 75 recommendations for how to prevent the cyber doomsday it spells out, and the commission that made it were both mandated by the 2019 National Defense Authorization Act (NDAA).

The commissioners, who include co-chairmen Sen. Angus King (I-Maine) and Rep. Mike Gallagher (R-Wis.), highlight a range of issues to address, but zero in on election security as “priority.”

“The American people still do not have the assurance that our election systems are secure from foreign manipulation,” King and Gallagher wrote in the report. “If we don’t get election security right, deterrence will fail and future generations will look back with longing and regret on the once powerful American Republic and wonder how we screwed the whole thing up.”

The focus on shoring up election security, and the agreed-upon recommendations for how to do this, sets the report apart from the approach to the subject on Capitol Hill, where it has been a major issue of contention between Republicans and Democrats since Russian interference in the 2016 presidential election.

Beyond election security, the commissioners call for overarching government reform to address cyber vulnerabilities. Chief among these is calling on the White House to issue an updated national strategy to address cyber threats and to establish a national cybersecurity director position to coordinate efforts.

In terms of congressional action, commissioners recommend that Congress create cybersecurity committees in both the House and Senate, establish a Bureau of Cybersecurity Statistics, and establish an assistant secretary position at the State Department to lead international efforts around cybersecurity.

“While cyberspace has transformed the American economy and society, the government has not kept up,” commissioners wrote in calling for reforms.

The commission also zeroed in on “imposing costs” to adversaries who attempt to attack the U.S. online. In order to do so, it recommended that the Department of Defense conduct vulnerability assessments of its weapons systems, including nuclear control systems, and that it make cybersecurity preparedness a necessity.

The Cybersecurity and Infrastructure Security Agency, the Department of Homeland Security’s cyber agency, would be empowered as the “lead agency” at the federal level.

The report’s recommendations were debated on and pinpointed by a group of high-ranking commissioners who also included FBI Director Christopher Wray, Deputy Secretary of Defense David Norquist, Transportation Security Administration Administrator David Pekoske, Sen. Ben Sasse (R-Neb.), and Rep. James Langevin (D-R.I.).

Langevin said in a statement on Wednesday that the report is intended to shore up the nation’s cyber “resiliency for years to come.”

“Our charge in drafting this report was to prevent a cyber event of significant national consequence, and we know that the short- and long-term recommendations we crafted will better position us to realize the promise of the Internet, while avoiding its perils,” Langevin said. “The sooner our recommendations are implemented, the better positioned the country will be to prevent and respond to incidents that can disrupt the American way of life.”

The report’s recommendations may soon have real-world consequences on Capitol Hill.

Rep. John Katko (R-N.Y.), the ranking member on the House Homeland Security Committee’s cyber panel, told The Hill this week that there “definitely will be some legislation” stemming from the report’s recommendations, and that hearings would likely be held.

Katko noted that he had talked with Senate Homeland Security Committee Chairman Ron Johnson (R-Wis.) about the Senate also taking action around the report.

“This report screams of the need for bipartisan action on this, and I hope that we can leave the politics out of it, and I hope we can attack these problems quickly and effectively,” Katko said.

Rep. Cedric Richmond (D-La.), the cyber subcommittee’s chairman, opened a hearing on Wednesday by praising the report’s recommendations and saying he looked forward to working to “codifying” the ideas alongside House Homeland Security Committee Chairman Bennie Thompson (D-Miss.).

Industry groups also reacted positively to the report’s recommendations. Tom Gann, the chief public policy officer of cybersecurity firm McAfee, told The Hill in a statement that he agreed with most of the report’s findings and hoped that they are “acted upon with speed.”

Protect Our Power, a nonprofit with the goal of protecting the electric grid, also praised the report.

“These are compelling recommendations, echoing issues we have highlighted for several years now, and action is long overdue,” Jim Cunningham, executive director of the group, said in a statement. “Without a reliable supply of electricity before, during and following a disabling cyberattack, none of our critical infrastructure can function.”

While there may be legislative action soon – and praise from industry groups – both Gallagher and King emphasized in the report that their main aim was for it to open the eyes of Americans to the dangers posed by cyberattacks on critical systems.

“The status quo is inviting attacks on America every second of every day,” the co-chairmen wrote. “We all want that to stop. So please do us, and your fellow Americans, a favor. Read this report and then demand that your government and the private sector act with speed and agility to secure our cyber future.”

Horse Racing Doping Schemers Charged

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Disgusting but it is common in the industry.

 

Federal prosecutors announced charges on Monday against more than two dozen racehorse trainers, veterinarians and drug distributors in a wide-ranging series of indictments that laid out a corrupt scheme to secretly dope horses and cheat the betting public in what has become a $100 billion global industry.

Maximum Security's Unique Derby Path Serves Him Well ... source

Among the 27 people charged was Jason Servis, the trainer of Maximum Security, one of the best racehorses in the world. He covertly administered performance-enhancing drugs “to virtually all the racehorses under his control,” the indictment charged, adding that from February 2018 to February 2020 he entered horses in more than 1,000 races.

Maximum Security moved from Jason Servis after indictments ... Maximum Security

In May, Maximum Security crossed the finish line first at the Kentucky Derby, only to be disqualified for almost knocking over a rival horse and slowing the momentum of others. Country House, a 65-1 shot, was named the winner. Last month, Maximum Security won $10 million at the Saudi Cup at the King Abdulaziz racecourse in Riyadh, the world’s richest race

The scheme, as laid out in four separate indictments against a total of 27 people, was to manufacture and distribute adulterated and misbranded drugs and to secretly administer them to racehorses under their control.

The participants sought to improve race performance and obtain prize money from tracks throughout the United States, including in New York, New Jersey, Florida, Ohio and Kentucky, as well as the United Arab Emirates, one indictment said, “all to the detriment and risk of the health and well-being of the racehorses.”

To avoid detection of their scheme, the indictment said, the defendants routinely defrauded and misled federal and state regulators “and the betting public.”

The charges were to be announced at a news conference on Monday by Geoffrey S. Berman, the United States attorney in Manhattan, and William F. Sweeney Jr., head of the F.B.I.’s New York office.

Horse racing has a long history of trainers’ repurposing drugs in pursuit of a performance edge. Frog and cobra venom, Viagra, cocaine, heart medicines and steroids have all been detected in drug tests. This reliance on performance-enhancing drugs combined with lax state regulations has made American racetracks among the deadliest in the world.

Nearly 10 horses a week on average died at U.S. racetracks in 2018, according to the Jockey Club’s Equine Injury Database. That figure is anywhere from two and a half to five times greater than the fatality rate in Europe and Asia, where rules against performance-enhancing drugs are enforced more stringently.

Last year, at Santa Anita Park, a few miles east of Pasadena, more than 30 horses were euthanized after fatal breakdowns, including 23 of them in a three-month span that nearly shut down racing in Southern California and led to an investigation by the Los Angeles district attorney.

The post More Than Two Dozen Charged in Horse Racing Doping Scheme appeared first on New York Times.

***

Gary West, the owner of Maximum Security, released a statement on Tuesday saying he had terminated Servis’s employment. “Yesterday, Jason Servis, a trainer we have used for 5 years, was indicted on multiple charges regarding using an illegal substance in horses. This news is extremely disturbing and disappointing. Therefore we will be moving all our horses from Jason Servis as soon as arrangements can be made with other trainers. Maximum Security will be sent to Bob Baffert.”

According to the charges, Servis administered a drug called SGF-1000 to Maximum Security and other horses and then conspired with a vet to cover up the doping. Authorities say such acts of doping can cause horses to over-exert themselves, potentially leading to their deaths.

The welfare of racehorses has been under the microscope in the US over the last year after a spike in deaths. More than 30 horses died last year at Santa Anita, one of the most famous tracks in America. According to the Jockey Club’s Equine Injury Database, death rates at American tracks are up to five times

Biden’s Americore Under FBI Investigation

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Biden, Inc., or James Biden in deep legal trouble.

Joe Biden’s Brother Accused of Defrauding Rural Healthcare ...

FBI got a search warrant and raided the office….

The Federal Bureau of Investigation raided a health care business linked to Joe Biden’s brother in late January, seizing boxes of documents.

The raid of an Americore Health hospital represented a deepening of the legal morass surrounding James Biden’s recent venture into health care investing at a time when questions about the business dealings of Joe Biden’s relatives, and their alleged connection to the former vice president’s public service, continue to dog his presidential campaign.

In the weeks since the raid, two small medical firms that did business with James Biden have claimed in civil court proceedings to have obtained evidence that he may have fraudulently transferred funds from Americore “outside of the ordinary course of business,” and a former Americore executive has told POLITICO that James Biden had more than half a million dollars transferred to him from the firm as a personal loan that has not yet been repaid.

The purpose of the Jan. 30 raid of an Ellwood City, Pa., hospitalremains unclear, and there is no indication it was related to the actions of Biden’s younger brother, who has not been accused of criminal wrongdoing. Its owner, Americore, has faced legal problems and allegations of mismanagement that are unrelated to James Biden.

But recent filings in ongoing legal proceedings, along with new accounts provided to POLITICO by former executives of Americore and others, point to potential pitfalls for the former vice president, painting the fullest picture to date of James Biden’s health care dealings and the ways in which they allegedly related to his older brother. In 2017 and 2018, James Biden was embarking on a foray into health care investing, telling potential partners, including at Americore, that his last name could open doors and that Joe Biden was excited about the public policy implications of their business models, according to court filings and interviews with James’ former business contacts.

Tom Pritchard, a former Americore executive familiar with the business’ finances, told POLITICO that James Biden’s arrival exacerbated Americore’s financial problems. Holding out the promise of a large investment from the Middle East based on his political connections, James Biden introduced Americore’s founder to his older brother and helped land a bridge loan to Americore from a hedge fund, Pritchard said. But then, Pritchard said, James Biden received a six-figure personal loan out of Americore’s coffers while encouraging the firm to take on greater financial liabilities. The cash infusion from the Middle East never arrived, and, Pritchard says, James Biden has not paid back the loan, the terms of which are unknown.

“It was all smoke and mirrors,” Pritchard said.

Meanwhile, Americore found itself increasingly hamstrung by high-interest loans and unable to pay employees and vendors, a situation that disrupted the operations of the rural hospitals it owns.

Now, the business is in bankruptcy court, and federal authorities are circling.

David Randolph Smith, an attorney for James Biden, declined to comment.

A Biden campaign official said that Joe Biden never discussed Americore with his brother or expressed support for the business. The official said that Americore’s founder, Grant White, purchased a ticket to a September 2017 fundraiser for the Beau Biden Foundation, an event attended by Joe Biden. “If the two interacted in any way, it would have been a handshake and nothing more,” the official said.

The messy politics surrounding the business dealings of Biden’s relatives, and President Donald Trump’s efforts to exploit them, have loomed over the presidential contest for several months, damaging both camps. Trump’s failed attempts to pressure Ukraine’s government to announce an investigation of Biden and his son, Hunter, led to Trump’s impeachment. Though Trump was acquitted by the Republican-controlled Senate, polls showed that a plurality of Americans consistently supported the impeachment, which highlighted evidence that Trump abused his power for partisan political ends. At the same time, a recent POLITICO/Morning Consult poll found that 57 percent of voters believe Hunter Biden’s well-compensated position on the board of a Ukrainian energy firm amounted to a scandal, compared to 19 percent who do not.

Over the course of Biden’s run, reports have trickled out about James, a sometimes business partner of Hunter’s, who has received financial support from people with an interest in influencing Joe and been repeatedly accused of trading on Joe’s clout to advance his business ventures.

Biden has defended his son Hunter and said that his relatives’ business dealings have had no connection to his official duties. But the recent developments related to James Biden’s health care ventures demonstrate that as long as Biden remains in the campaign, the issue of his relatives’ financial dealings is likely to remain as well.

Even before the development surrounding Americore, James Biden’s venture into health care investing has been surrounded by legal allegations and claims that he invoked his brother’s clout.

Last year, two medical services firms jointly sued James Biden and his business partners in federal court in Tennessee, alleging James and his partners promised to provide a large investment from the Middle East, then pushed the firms to make expensive acquisitions, as part of a scheme to drive them out of business and steal their business models. As previously reported, those firms alleged that James Biden cited his family’s political connections and promised his older brother would promote their health care model as part of his 2020 presidential campaign.

Another health care firm sued Platinum Global Partners — a Florida corporation that lists James and his wife Sara as managers — in Palm Beach County in June. The firm, which makes an oral rinse with applications for cancer patients, alleged that Platinum reneged on an agreement to invest in it and requested that Platinum turn over documents related to the Biden Cancer Initiative, a nonprofit founded by Joe Biden to fund medical research. An executive involved in litigation against James Biden previously told POLITICO that, on a call, James said he could get the Biden Cancer Initiative to promote the oral rinse.

The Tennessee case is ongoing. The Palm Beach County case was dismissed without prejudice in November.

James Biden and his partners have denied the central allegations in both cases.

But, in interviews, former executives of Americore offered additional, similar accounts of James Biden invoking his brother’s influence and the promise of investment funds from the Middle East that never materialized in order to push their firm to grow quickly, taking on new financial liabilities.

Unlike those other firms, Americore is now in the sights of the Justice Department.

The precise nature of James Biden’s relationship to the firm — founded by White, a Canadian investment banker, in 2017— is contested.

The plaintiffs in the Tennessee case described him as a principal of Americore and entered a business card identifying him as such into evidence. James Biden has disputed that he is a principal of the firm in court proceedings, though he has not detailed the precise nature of his ties to Americore,which owns hospitals in Pennsylvania, Arkansas and Missouri.

Pritchard and the other former Americore executive, who spoke on condition of anonymity out of fear of retaliation, each said James Biden was actively involved in the company during their tenures there. “Jim was operating as a principal or Jim was portraying that,” Pritchard said. “Whether on paper he had any ownership, I’m not 100 percent sure.”

Pritchard said James Biden first became involved with Americore in 2017, offering to use his political contacts to help the firm land business and investments. “He could get us in front of the unions. He could get us in front of certain people in government. He could get us in front of the right people,” recalled Pritchard, who said he was skeptical of plans to involve James Biden in the firm.

A former employee at Pineville Community Hospital in southeastern Kentucky, which was acquired by Americore in 2017, said she got the impression that James Biden was in a top leadership role at Americore when he visited the facility and introduced himself in early 2018.

The other former Americore executive — who left the firm after less than a year over concerns about its business practices that were unrelated to James Biden — recalled that James spoke regularly of the ways in which Joe Biden’s presidential aspirations could benefit the firm, and vice versa. “His brother was very interested in rural health care and very interested in veterans’ health care, and it was something he really wanted to get behind,” the former executive recalled James Biden saying. “This would help his brother get elected if it were to take off and go.”

Both former executives recalled James Biden said he would help facilitate a multimillion-dollar investment from the Middle East.

Pritchard said the exact source of the funds was never made clear to him. “That linkage was supposed to come via Jim Biden via whatever influence he had through his brother in the Middle East,” said the other former executive, who worked for Americore in 2018.

The plaintiffs in the Tennessee case allege James Biden and his partners aimed to solicit investments from the state-owned Qatar Investment Authority and met in West Palm Beach with representatives of the Turkish conglomerate Dogan Holding. James Biden and his co-defendants denied the allegation about the Qatar Investment Authority and acknowledged meeting with Dogan.

The former executives also said that James Biden began to set up an office on the second floor of Americore’s headquarters in Fort Lauderdale, Fla. “It was like a little shrine to him and his brother and [former President Barack] Obama,” recalled Pritchard, who said he clashed with James Biden over James’ requests to be reimbursed for pricey furniture for the office.

The other former executive said that when he saw the office, several framed photos of the Biden brothers and foreign dignitaries sat on the floor, ready to be hung on the walls.

The former executives also described James Biden’s role in soliciting financing for Americore.

Pritchard said James Biden arranged a bridge loan to Americore via his business partner Michael Lewitt’s hedge fund, the Third Friday Total Return Fund.

But Pritchard said he learned that after Americore received the bridge loan, it made a six-figure loan to James Biden for his personal use.

Lewitt declined to comment, but referred to a letter he sent the Ellwood City Ledger blaming White’s alleged use of high-interest loans for Americore’s problems and vowing to restore the firm’s finances and operations.

Several Americore entities are currently in the midst of federal bankruptcy proceedings, providing a glimpse into their finances.In February, one of those entities, Americore Health LLC, filed a schedule of assets that included $650,000 due to accounts receivable. Pritchard said that figure referred to the loan repayment owed by James Biden.

Pritchard said that after James Biden received his loan payment from Americore, James reduced his involvement with the firm as its financial difficulties mounted.

“Jim needed to lay low because his brother was possibly running for president, and he didn’t need any bad press,” Pritchard recalled, saying that after James stepped back, Lewitt asked to review Americore corporate documents to ensure they did not bear James’ name.

The other former executive said that not long after he first saw the office being set up for James Biden in mid-2018, the office was emptied out.

Meanwhile, Americore’s problems have increasingly spilled into public view.

 

Details of Bernie Sanders and Yaroslavl, the Sister City

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One has to travel to Russia and visit the archives in Yaroslavl to see the full details of the trip then Mayor of Burlington, Vermont Bernie Sanders took for his honeymoon.

WaPo

IN part from the NYT’s: Many of the details of Mr. Sanders’s Cold War diplomacy before and after that visit — and the Soviet effort to exploit Mr. Sanders’s antiwar agenda for their own propaganda purposes — have largely remained out of sight.

The New York Times examined 89 pages of letters, telegrams and internal Soviet government documents revealing in far greater detail the extent of Mr. Sanders’s personal effort to establish ties between his city and a country many Americans then still considered an enemy despite the reforms being initiated at the time under Mikhail S. Gorbachev, the Soviet general secretary.

They also show how the Kremlin viewed these sister city relationships as vehicles to sway American public opinion about the Soviet Union.The Sanders campaign didn’t dispute the documents’ authenticity; the English-language documents were shared with the campaign and the relevant Russian documents were described. At the time of Mr. Sanders’s announcement in 1987 that Burlington would seek a Soviet sister city, several dozen other American cities already had such a relationship or had applied for one.

The documents, available at the Yaroslavskaya Region State Archive in Yaroslavl, are included in a file titled “documents about the development of friendly relations of the city of Yaroslavl with the city of Burlington in 1988.”

Mr. Sanders’s involvement in the Cold War debate grew in the 1980s as he forcefully opposed the Reagan administration’s plans to have Burlington and other American cities make evacuation plans for a potential nuclear war.

Instead, Mr. Sanders reached out to the Soviet Union via an organization based in Virginia, requesting a sister-city partnership with the Cold War adversary in an effort to end the threat of nuclear annihilation. In December 1987, the records show, Mr. Sanders spoke by phone with Yuri Menshikov, the secretary of the Soviet sister-city organization in Moscow. In a follow-up letter later that month, Mr. Sanders said he had received word that Yaroslavl would be an ideal partner. He proposed leading a Burlington delegation to Yaroslavl to lay the foundation for a sister-city relationship.

He suggested arriving on May 9 — the day that the Soviet Union celebrated its victory over Nazi Germany — and said he was especially interested in discussing economic development, the police, winter street cleaning, libraries, and plumbing and sewer systems. “People there seemed reasonably happy and content,” Mr. Sanders told reporters in Burlington about Yaroslavl, a city of about 600,000. “I didn’t notice much deprivation.”

Two days after returning to Vermont, Mr. Sanders wrote to the Soviet Embassy in Washington, asking for help in setting up the sister-city program.

“It is my strong belief that if our planet is going to survive, and if we are going to be able to convert the hundreds of billions of dollars that both the United States and the Soviet Union are now wasting on weapons of destruction into areas of productive human development, there is going to have to be a significant increase in citizen-to-citizen contact,” Mr. Sanders wrote. The sister city program was something of a capstone to nearly a decade’s worth of foreign policy activism in Burlington City Hall. As mayor, Mr. Sanders championed a range of international causes that often aligned him with left-wing movements and leaders in other countries, and against the Reagan administration, which he described as pursuing a strategy of military escalation that risked setting off a nuclear war.

Mr. Sanders pressed the city government to take positions against American intervention in Nicaragua and El Salvador, and against the invasion of Grenada. In 1985, he visited Managua for the sixth anniversary of the Sandinista revolution and met with its leader, Daniel Ortega. To read the full article from the NYT’s, click here.

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Just a lil more from Politico:

Bruce Seifer, a top economic development aide to Sanders when he was mayor, said that 100 residents from Yaroslavl immigrated to Burlington after the trip and others visited.

“Over time, it had a positive impact on to the economy,” he said. “Businesses started doing exchanges between Burlington and Yaroslavl.”

Davitian, who lived in Burlington at the time, said progressives were thrilled by Sanders’ trip to the Soviet Union, while everyday residents didn’t mind. “As long as the streets were getting paved, there wasn’t opposition to him as an activist mayor,” she said.

When Sanders’ delegation returned to Burlington, CCTV captured the group on film in a hopeful mood, applauding the Soviet Union’s after-school programs, low rent costs and hospitality.

At the same time, they admit the poor choices of available food. Sanders says he was impressed by the beauty of the city and Soviet officials’ willingness “to acknowledge many of the problems that they had.”

“They’re proud of the fact that their health care system is free,” he says, but concede that the medical technology is far behind that of the United States.

Later that year, the relationship was officially established. Since then, “exchanges between the two cities have involved mayors, business people, firefighters, jazz musicians, youth orchestras, mural painters, high school students, medical students, nurses, librarians, and the Yaroslavl Torpedoes ice hockey team,” according to Burlington’s city government. A delegation traveled there as recently as 2016.

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One last thing from National Review to consider:

Sanders made further globe-trotting expeditions to socialist countries. He visited Cuba, scoring a meeting with Havana’s mayor. In 1985 he attended the celebrations marking the sixth anniversary of the Sandinista revolution in Nicaragua. “In a letter addressed to the people of Nicaragua, penned in conjunction with that trip, Sanders denounced the activities of the Reagan administration, which he said was under the influence of large corporations,” the Guardian notes. “In the long run, I am certain that you will win,” Sanders wrote, “and that your heroic revolution against the Somoza dictatorship will be maintained and strengthened.” (The Sandinistas were ousted by Nicaragua’s voters in 1990).

Sanders isn’t the only radical U.S. politician to have a weakness for Communist dictatorships. In 2013, Bill de Blasio was caught off guard during his campaign for New York mayor when a Cuban-American radio host challenged him about Castro’s regime.

Ino Gómez, who fled Cuba in 1970, asked de Blasio in an interview about what he was thinking when he chose to violate U.S. law and spend his honeymoon in Cuba in 1991.

“What did you see in Cuba? What is your impression going on a honeymoon in a country that hasn’t had free elections in the last 50 years? What did you get from that trip?” Gómez asked.

A defensive de Blasio sputtered: “I didn’t go on a trip to study the country. I don’t pretend to have full perspective of the country.” He then acknowledged Cuba is undemocratic but praised “some good things that happened — for example, in health care.”

Gomez was having none of it. “I just had to send my aunt in Cuba some, you know, the thread to have stitches, because they don’t have in Cuba the thread,” he told the future mayor of Gotham.

De Blasio chose not to reply and the host moved on to other topics, giving him a pass on his 1988 trip to Nicaragua in support of the Sandinistas.

Bill de Blasio to endorse Bernie Sanders

In closing, remember that New York Mayor de Blasio is campaigning for Sanders…gotta wonder if all this is well known to the gigantic grass-roots operation Sanders has built for his presidential campaign.