A trial continues as fentanyl drug traffickers are sentenced in court, Thursday, Nov. 7, 2019, in Xingtai, north China’s Hebei Province. The court sentenced at least nine fentanyl traffickers Thursday in a case that was a culmination of a rare collaboration between Chinese and U.S. law enforcement to crack down on global networks that manufacture and distribute lethal synthetic opioids. (Jin Liangkuai/Xinhua via AP)
XINGTAI, China (AP) — A Chinese court sentenced nine fentanyl traffickers on Thursday in a case that is the culmination of a rare collaboration between Chinese and U.S. law enforcement to crack down on global networks that manufacture and distribute lethal synthetic opioids.
Liu Yong was sentenced to death with a two-year reprieve, while Jiang Juhua and Wang Fengxi were sentenced to life in prison. Six other members of the operation received lesser sentences, ranging from six months to 10 years. Death sentences are almost always commuted to life in prison after the reprieve.
Working off a 2017 tip from the U.S. Department of Homeland Security about an online drug vendor who went by the name Diana, Chinese police busted a drug ring based in the northern Chinese city of Xingtai that shipped synthetic drugs illicitly to the U.S. and other countries from a gritty clandestine laboratory. They arrested more than 20 suspects and seized 11.9 kilograms (26.2 pounds) of fentanyl and 19.1 kilograms (42.1 pounds) of other drugs.
In form, the enterprise resembled a small business, with a perky sales force that spoke passable English, online marketing, contract manufacturing, and a sophisticated export operation, according to U.S. and Chinese law enforcement.
But the business had grave implications. Police photographs of the seizure show a dingy, chaotic scene, with open containers of unidentified chemicals and Chinese police in rubber gloves and breathing masks.
Liu and Jiang were accused of manufacturing and trafficking illicit drugs. The others were accused of trafficking.
Chinese officials said the Xingtai case was one of three fentanyl trafficking networks they are pursuing based on U.S. intelligence, but declined to discuss the details of the other cases, which are ongoing.
Austin Moore, an attaché to China for the U.S. Homeland Security Department, said the Xingtai case was “an important step” showing that Chinese and U.S. investigators are able to collaborate across international borders.
Moore said Chinese police identified more than 50 U.S. residents who tried to buy fentanyl from the Xingtai organization. Those leads prompted over 25 domestic investigations and have already resulted in three major criminal arrests and indictments in New York and Oregon, he said.
Scrambling to contain surging overdose deaths, Washington has blamed Beijing for failing to curb the supply of synthetic drugs that U.S. officials say come mainly from China. In August, President Donald Trump lashed out at Chinese President Xi Jinping for failing to do more to combat illicit opioid distribution in China’s vast, freewheeling chemicals industry. U.S. officials have reportedly moved to link Beijing’s efforts on fentanyl to U.S. trade talks.
Yu Haibin, deputy director of the Office of China National Narcotics Control Commission, on Thursday called allegations that Chinese supply is at the root of America’s opioid problem “irresponsible and inconsistent with the actual facts.”
“Drug crime is the public enemy of all humankind,” he added. “It’s about the life of human beings. It should not be related with the trade war or other political reasons.”
Chinese officials have been at pains to emphasize the efforts they have made to expand drug controls and crack down on illicit suppliers, even though synthetic opioid abuse is not perceived to be a significant problem in China.
But prosecuting cases against a new, rising class of Chinese synthetic drug kingpins has remained a challenge. Profit-seeking chemists have adroitly exploited regulatory loopholes by making small changes to the chemical structure of banned substances to create so-called analogs that are technically legal.
U.S. officials have been hopeful that China’s move earlier this year to outlaw unsanctioned distribution of all fentanyl-like drugs as a class will help constrain supply and make it easier to prosecute Chinese dealers.
According to the U.S. Centers for Disease Control and Prevention, more than 500,000 Americans died of drug overdoses in the decade ending in 2017 — increasingly, from synthetic opioids like the ones sold by the Xingtai network.
The American opioid crisis began in the 1990s, when the over-prescription of painkillers like OxyContin stoked addiction. Many people who became hooked on pain pills later moved to heroin. Fentanyl — an even more potent lab-made drug that raked in profits — then entered the U.S. illicit drug supply, causing overdose deaths to spike.
***
The question of what, if any, responsibility China should bear for fuelling a deadly opioid crisis in the United States has been a bitter source of contention between the two superpowers.
China’s jailing of nine people Thursday for trafficking and selling fentanyl to US buyers following a rare joint probe with US law enforcement would suggest Beijing is moving to address the problem.
But experts warn that while the case is a big step, it is not enough to stop the drug from pouring into the United States — from China and increasingly from Mexico as drug cartels pick up the slack.
Here is a look at the opioid crisis and the tensions it has caused between China and the United States:
What’s fentanyl?
Fentanyl was introduced to the US market in the 1960s as an intravenous anaesthetic to manage severe pain. It is used for cancer patients or those receiving end-of-life care.
The drug is 50 times more potent than heroin, with only a few milligrammes — equivalent to a few grains of sand — enough to kill someone.
It is trafficked into the United States, primarily from China and Mexico, in the form of powder or tablets, and is sometimes mixed with heroin and cocaine.
Fentanyl and other synthetic opioids killed 32,000 people in the US last year according to government data.
The drug can be bought online and shipped to the United States via regular mail, posing a major challenge for postal inspectors sifting through mountains of packages.
What’s China doing about it?
Trump has long urged China to crack down on fentanyl.
It has even become a bargaining chip in the trade spat between the world’s two largest economies.
“High-level officials continue to blame China for the failure to stem the flow and that might be impacting the trade negotiations,” Bryce Pardo, a policy researcher at RAND Corporation, told AFP.
When Trump and President Xi Jinping declared a trade war truce at a summit in Argentina in December 2018, the Chinese side said it would designate all variants of fentanyl as controlled substances.
Trump hoped the move would be a “game changer” because China applies the death penalty against drug dealers.
It was not until five months later, in May, that China finally designated all fentanyl analogues as a controlled substance.
Before the ban, smugglers could skirt the law by changing the formula to make fentanyl-like drugs.
But three months later, Trump complained that China was still not doing enough.
Then came the news on Thursday that a court in northern Hebei province had handed a suspended death sentence to a smuggler and jailed eight others for terms ranging from six months to life after the first successful joint US-China investigation against a fentanyl operation.
Is it enough?
“It’s one case. You can count it as a success and it is,” Mike Vigil, a former head of international operations at the US Drug Enforcement Administration (DEA), told AFP.
“But there is much more to be done. That’s a very tiny tip of the iceberg,” Vigil said.
Experts say China lacks the manpower to inspect all laboratories that produce fentanyl.
“The big problem is that there are so many laboratories and they have about 2,000 inspectors, which is not nearly enough,” Vigil said.
Scott Stewart, a security analyst at US intelligence consultancy Stratfor, said the flow of fentanyl and its precursor chemicals will not stop until China addresses “deeper problems” such as going after “powerful players” and lifting tax credits companies get for selling certain chemicals.
Is the ban working?
While the US welcomed China’s ban on all types of fentanyl, the move appears to have shifted production to Mexico, where drug cartels have quickly adapted to new law enforcement actions.
Chinese labs also produce the chemicals needed to make fentanyl and Mexican drug traffickers are importing them to produce the narcotic themselves, Vigil said.
“Precursor chemicals are fuelling the rise in the manufacture of fentanyl in Mexico by the major drug cartels,” Vigil said.
The DEA said Monday the cartels were making “mass quantities” of fentanyl-laced drugs.
China, for its part, continues to deny it is the source of the problem.
Following Thursday’s court case, Yu Haibin, a Chinese anti-drug official, pointedly said American deaths from overdoses had continued to rise after Beijing cracked down on all types of fentanyl.
Category Archives: Trump Administration
The Lawyer’s Plot for the Coup Against Trump
Have you met Edward Luttwak? You can be sure the lawyer for the Whistleblower has. Luttwak published a book titled Coup D’ Etat, the practical handbook.
Coup d’État astonished readers when it first appeared in 1968 because it showed, step by step, how governments could be overthrown. Translated into sixteen languages, it has inspired anti-coup precautions by regimes around the world. In addition to these detailed instructions, Edward Luttwak’s revised handbook offers an altogether new way of looking at political power—one that considers, for example, the vulnerability to coups of even the most stable democracies in the event of prolonged economic distress.
So we have this cat, Mark Zaid. Within minutes of the inaugural event for President Trump, Zaid’s tweets began stating the coup has begun. Now the question is who in Washington DC was watching, considering and conspiring to join the coup army…plenty.
Zaid is a known quantity inside the Beltway.
Zaid is a recognized expert in Federal court especially in whistle-blower cases. These cases almost always include leaking or publishing classified material as such is/was the case of Edward Snowden. The Zaid law firm, where he is the managing partner includes at least 5 other lawyers handling cases of national security, diplomatic immunity, defamation cases and international transactions. Zaid is the founder of the James Madison Project, a non-profit organization that takes on government agencies for alleged wrong-doing, coverups and secrecy policies. Note however he never took on Hillary and Libya…or the email server scandal….
Mr. Zaid has testified before several committees in the House and the Senate all with the twist of meeting the ‘curiosity of this town’ as noted on the law firms website. With his early launch of the coup has started, you can bet some of this friendlies on The Hill followed his legal handbook and we are now enduring what Congressman Nunes calls a paper coup. Zaid has TS/SCI clearance and that add more bona fides to his power within the offices of the Democrats that include for sure Speaker Pelosi that is often providing all the permissions needed to Congressman Adam Schiff leading the impeachment inquiries.
Does anyone wonder how come Mr. Zaid never took any whistle-blower cases as they related to the Obama administration or even John Kerry with regard to the Iran deal? How about the IRS targeting operation or any of the other scandals in recent years….just sayin…
Okay, then there is also the other lawyer and law firm that has Andrew Bakaj with Compass Rose Legal Group.
Let me get this straight: the whistleblower (leaker) had no firsthand knowledge of the call and was just spreading a rumor?
And now is being represented by an attorney who had to leave the CIA after a “whistleblower” incident and has the names Schumer and Clinton on his resume?
— Rep. Mark Walker (@RepMarkWalker) September 24, 2019
BREAKING NEWS: I am now formally part of legal team, through @CompassRosePLLC & lead counsel @AndrewBakaj, rep’ing #natsec #whistleblower at center of current controversy.
Neither law firm @MarkSZaidPC nor @BradMossEsq involved so Brad can continue to comment on WB policy/law.
— Mark S. Zaid (@MarkSZaidEsq) September 21, 2019
An attorney who left the CIA in 2014 after facing professional retaliation for trying to work with intelligence community whistleblowers is now representing the U.S. official who reportedly filed a complaint alleging wrongdoing by President Trump.
Andrew Bakaj, a national security attorney working for Compass Rose Legal Group, a Washington national security law firm, has taken on the still unidentified whistleblower as his newest client, according to information first reported by the New York Times and confirmed by Yahoo News.
According to his Linkedin profile, Bakaj was an intern at the U.S. State Department from June 2002 to August 2002 at the U.S. Embassy in Kyiv, Ukraine. He, “Created the Embassy’s fraud database, performed various counter-fraud duties, interviewed visa candidates, translated official Ukrainian/Russian documents into English, and represented official U.S. interests at various events throughout Ukraine.
On September 24, Bakaj sent a ‘Notice of Intent to Contact Congressional Intelligence Committees’ letter to acting Director of National Intelligence Joseph Maguire, who took over for Dan Coats directly with the complaint. House Intelligence Committee Chairman Adam B. Schiff, who was copied on Bakaj’s letter, responded the same day. Schiff, who represented California’s 28th congressional district, asked for the whistleblower to come in for “voluntary interview” after Maguire testifies in a rare, open session Thursday, September 26, in a “secure location.”
Bakaj made a $100 campaign contribution to former Vice President Joe Biden’s 2020 Democratic presidential primary campaign through ActBlue, according to Federal Election Commission records. He made the contribution on April 26, 2019. ActBlue is a nonprofit that facilitates contributions to Democratic candidates.
Bakaj interned for Senator Chuck Schumer in the spring of 2001 and for then-Senator Hillary Clinton the fall of the same year. Hat tip.
Still Defiant, Iran Doubles Uranium Centrifuges
RFERL: The UN’s nuclear watchdog has issued a report saying Iran is preparing for possible major expansion of uranium enrichment in a fortified underground facility.
The International Atomic Energy Agency’s (IAEA) quarterly report also says “extensive activities” — a reference to suspected sanitization efforts — at Iran’s Parchin military complex will hamper its investigation of possible past nuclear weapons development work there, if inspectors are granted access.
Parchin
The report says Iran has produced 189 kilograms of higher-grade enriched uranium since 2010 — up from 145 kilograms since May, when the previous quarterly report was issued.
The IAEA reported last year that Iran placed “a large explosives containment vessel” in Parchin in 2000 and constructed a building around it.
The facilities were designed to contain the detonation of up to 70 kilograms of high explosives — something the IAEA called “relevant to the development of an explosive nuclear device.”
Since that report, the IAEA has sought to send inspectors to the site of the suspected building but have been denied access by Iran to that part of the military base.
In recent months, the agency also has obtained information that indicates Iran has been busy cleaning up the suspected site, including tearing down some buildings and removing soil.
The last effort by the IAEA to convince Iran to let inspectors visit the site — where Iran denies clean-up activities are taking place — broke down in June when Tehran accused the agency of acting like an “intelligence organization.”
More Centrifuges At Fordow Site
Fordow
The IAEA’s latest report also says the number of enrichment centrifuges at Fordow has more than doubled to 2,140 from 1,064 in May.
The Fordow facility is extremely controversial for two reasons.
First, it is dug into a mountain, making it difficult to bomb — suggesting it could have a military purpose.
Secondly, the centrifuges at the facility are being used to enrich uranium to purities of 20 percent — far higher than the 4 percent needed for fuel for commercial reactors.
Iran has said it is producing the 20 percent-enriched fuel for use in research reactors to produce medical isotopes.
But arms-control experts worry that creating large stockpiles of 20 percent-enriched uranium makes it much easier for Iran to later complete the jump to 90 percent-enriched uranium needed for nuclear bombs.
In Washington, the White House said it was closely studying the fresh IAEA report.
In Tehran, Ayatollah Ali Khamenei, Iran’s supreme leader, denied his country is seeking to develop nuclear weapons, adding Iran will “never abandon its right for the peaceful use of nuclear energy.”
In what appears to be a sign of the IAEA’s growing concern over Iran’s nuclear activities, the agency this week revealed it was creating a special Iran “task force.”
The task force is to scrutinize Tehran’s nuclear program and its compliance with UN resolutions — including those demanding a suspension of uranium enrichment.
Iran has denied any interest in nuclear arms.
Meanwhile, Congresswoman Liz Cheney is introducing legislation to fully terminate all of the Iran nuclear deal including the remaining sanctions waivers.
Yet, it seems that Turkey, a NATO member and in major dispute with the United States over Syria has not only defied NATO rules and the United States but has fully allied with Russia but for sure now as well Iran.
FDD: The European Bank for Reconstruction and Development (EBRD) announced yesterday that it will sell its 10 percent stake in the Istanbul stock exchange after Turkey named as its CEO a Turkish banker convicted in U.S. court for his role in a multi-billion dollar scheme to evade Washington’s sanctions on Iran. Ankara’s move to reward a sanctions buster further strengthens the argument that Turkey has become a permissive jurisdiction for illicit finance.
Turkey’s sovereign wealth fund offered today to buy EBRD’s shares, which would increase the fund’s stake in the stock exchange to over 90 percent. EBRD’s exit will mean the departure of Borsa Istanbul’s only major foreign stakeholder at a critical moment in Turkey’s relations with its western allies. Ankara’s military operation in northeast Syria targeting the Syrian Democratic Forces – Washington’s key partner in the fight against the Islamic State – has drawn sweeping condemnation from the international community.
Five days after Ankara launched its Syria incursion, the U.S. Treasury Department imposed sanctions on three Turkish officials and Turkey’s ministries of energy and defense. That same week, the Southern District of New York filed an indictment charging Halkbank, a Turkish public lender, for its role in the multi-billion dollar gas-for-gold scheme to evade U.S. sanctions against Iran. Halkbank’s deputy general manager, Mehmet Hakan Atilla, in 2018 received a sentence of 32 months for his role in the affair. At the time of Atilla’s sentencing, Turkish President Recep Tayyip Erdogan condemned the trial as a political attack on his government.
Atilla returned to Turkey in July after serving his U.S. sentence. Last week, just days after U.S. federal prosecutors indicted Halkbank, Turkish Finance and Treasury Minister Berat Albayrak, who is also Erdogan’s son-in-law, named Atilla as CEO of the Istanbul stock exchange.
Atilla’s promotion is part of a string of appointments that showcase Erdogan’s policy of rehabilitating Iran sanctions busters and rewarding corrupt officials who further his personal ambitions. In September, Erdogan appointed former Minister for European Union Affairs Egemen Bagis as Turkey’s ambassador to Prague. Bagis had resigned from the ministry after a 2013 corruption scandal implicated him in accepting bribes related to the gas-for-gold scheme run through Halkbank.
Members of Erdogan’s Justice and Development Party (AKP) who dare criticize his policy of rehabilitating sanctions evaders continue to draw the Turkish president’s wrath. After publicly pronouncing strong opposition to Bagis’s ambassadorial appointment and other party policies, a senior AKP lawmaker, Mustafa Yeneroglu, resigned from the party yesterday after Erdogan commanded him to step down.
Another minister implicated in taking bribes as part of the Halkbank scheme, Zafer Caglayan, who served as minister of Economy in 2013 before resigning due to corruption allegations, has returned to political life as an AKP delegate from the Turkish city of Mersin. Caglayan is best known for accepting bribes of cash and jewelry worth tens of millions of dollars.
Erdogan’s rehabilitation of sanctions evaders continues to hurt Turkey’s image, economy, and investment climate. Ankara’s apparent disregard for U.S. sanctions, including those targeting Iran, Russia, and Venezuela, does not bode well for Washington or other NATO allies. Yet so far, President Donald Trump has shielded Erdogan from U.S. sanctions, the most recent of which he lifted after only nine days. In contrast, a biting sanctions bill focused on Turkey passed the House 403 to 16 on Tuesday. Like Congress, Trump should communicate to his Turkish counterpart that his policy of evading sanctions and rewarding sanctions busters could have dire consequences.
The Lebanon Government Just Fell
Primer:
Lebanon’s prime minister has demanded “justice” at the trial of four members of Hezbollah who are suspected of planning and executing the assassination of his father, Rafik Hariri.
Prosecutors say Hariri, a billionaire and former prime minister, was targeted by the armed group in 2005 because he opposed Syria’s control over Lebanon.
He was killed along with 21 others on February 14, 2005, when a massive truck bomb hit his convoy in the capital Beirut.
Again…
In November of 2017, Saad al Hariri resigned.
Hariri had promised he would return to Lebanon in time to mark its 74th independence day on Wednesday and would clarify his position.
On Tuesday he travelled to Cairo to see the Egyptian president, Abdel Fattah al-Sisi, whom he thanked for his support for Lebanon.
Hours later Hariri flew from Cairo to Larnaca in Cyprus where he met late at night with President Nicos Anastasiades, said a Cyprus government spokesman.
After a brief visit he flew on to Beirut where he is expected to take part in the independence day military parade early on Wednesday and the customary reception at the presidential palace.
Hariri’s Future Movement called on supporters to gather at his home in downtown Beirut at 1pm local time.
A dual Saudi citizen who has previously enjoyed Riyadh’s backing, Hariri resigned in a mysterious broadcast from the Saudi capital, accusing arch-rival Iran and its powerful Lebanese ally Hezbollah of destabilising his country.
But President Michel Aoun has yet to accept Hariri’s resignation, insisting he present it in person once back in the Lebanese capital.
During Hariri’s two-week stay in Riyadh, Aoun accused Saudi authorities of holding him “hostage” and demanded that he enjoy freedom of movement.
After mediation efforts by Egypt and France – which held former mandate power over Lebanon – the 47-year-old premier left Riyadh on Saturday.
He headed to Paris for talks with the French president, Emmanuel Macron, and pledged he would be home by Wednesday.
“As you know I have resigned and we will discuss that in Lebanon,” he said. Hariri said he could walk back from his resignation if Hezbollah withdrew from regional conflicts, including Syria. On the day Hariri resigned, the Saudi kingdom said it intercepted a ballistic missile fired by Tehran-backed Houthi rebels in Yemen at Riyadh.
BEIRUT (Reuters) – Saad al-Hariri resigned as Lebanon’s prime minister on Tuesday, declaring he had hit a “dead end” in trying to resolve a crisis unleashed by huge protests against the ruling elite and plunging the country deeper into turmoil.
Hariri addressed the nation after a mob loyal to the Shi’ite Muslim Hezbollah and Amal movements attacked and destroyed a protest camp set up by anti-government demonstrators in Beirut.
It was the most serious strife on the streets of Beirut since 2008, when Hezbollah fighters seized control of the capital in a brief eruption of armed conflict with Lebanese adversaries loyal to Hariri and his allies at the time.
Hariri’s resignation on Tuesday points to rising political tensions that may complicate the formation of a new government capable of tackling Lebanon’s worst economic crisis since its 1975-90 civil war.
The departure of Hariri, who has been traditionally backed by the West and Sunni Gulf Arab allies, raises the stakes and pushes Lebanon into an unpredictable cycle. Lebanon could end up further under the sway of the Iranian-backed Hezbollah, making it even harder to attract badly-needed foreign investment.
It also defies Hezbollah, which was part of his coalition and wanted him and the government to stay on. Hariri is seen as the focal point for Western and Gulf Arab aid to Lebanon, which is in dire need of financial support promised by these allies.
Lebanon has been paralyzed by the unprecedented wave of protests against the rampant corruption of the political class.
“For 13 days the Lebanese people have waited for a decision for a political solution that stops the deterioration (of the economy). And I have tried, during this period, to find a way out, through which to listen to the voice of the people,” Hariri said.
“It is time for us to have a big shock to face the crisis,” he said. “To all partners in political life, our responsibility today is how we protect Lebanon and revive its economy.”
Under Lebanon’s constitution, the government will stay on in a caretaker capacity as talks begin on forming a new one. It took nine months to form the Hariri coalition cabinet that took office in January.
As night fell, protesters returned to central Beirut waving Lebanese flags, seemingly unfazed by the violence.
Some described Hariri’s resignation as a victory for the “Oct. 17 uprising” and said the attack on the protest camp had redoubled their determination.
“What happened is a point of strength for us … If the thugs come in bigger numbers, so will we,” said Kamal Rida, a protester in central Beirut. “The tents that are broken can be rebuilt, easy.”
The turmoil has worsened Lebanon’s acute economic crisis, with financial strains leading to a scarcity of hard currency and a weakening of the pegged Lebanese pound. Lebanese government bonds tumbled on the turmoil.
TENTS ON FIRE
On the streets of Beirut, black-clad men wielding sticks and pipes attacked the protest camp that has been the focal point of countrywide rallies against the elite.
Sayyed Hassan Nasrallah, head of the heavily armed, Iran-backed Hezbollah, said last week that roads closed by protesters should be reopened and suggested the demonstrators were financed by its foreign enemies and implementing their agenda.
Smoke rose as some of the protester tents were set ablaze by Hezbollah and Amal supporters, who earlier fanned out in the downtown area of the capital shouting “Shia, Shia” in reference to themselves and cursing anti-government demonstrators.
“With our blood and lives we offer ourselves as a sacrifice for you Nabih!” they chanted in reference to Parliament Speaker Nabih Berri, head of the Amal Movement. “We heed your call, we heed your call, Nasrallah!” they chanted.
Security forces did not initially intervene to stop the assault, in which protesters were hit with sticks and were seen appealing for help as they ran, witnesses said. Tear gas was eventually fired to disperse the crowds.
Hariri did not refer to the violence in his address but urged all Lebanese to “protect civil peace and prevent economic deterioration, before anything else”.
France, which has supported Hariri, called on all Lebanese to help guarantee national unity.
U.S. Secretary of State Mike Pompeo urged the formation of a new government responsive to the needs of the Lebanese people.
“The Lebanese people want an efficient and effective government, economic reform, and an end to endemic corruption,” Pompeo said in a statement.
LEBANESE POUND UNDER PRESSURE
Lebanon’s allies last year pledged $11 billion in financing to help it revive its economy, conditional on reforms that Hariri’s coalition government has largely failed to implement.
But there has been no sign of a rush to help.
A senior U.S. State Department official said last week this was not a situation where the Lebanese government should necessarily get a bailout, saying they should reform first.
Banks were closed for a 10th day along with schools and businesses.
Hariri last week sought to defuse popular discontent through a batch of reform measures agreed with other groups in his coalition government, including Hezbollah, to – among other things – tackle corruption and long-delayed economic reforms.
But with no immediate steps towards enacting these steps, they did not placate the demonstrators.
Central bank governor Riad Salameh called on Monday for a solution to the crisis in just days to restore confidence and avoid a future economic meltdown.
A black market for U.S. dollars has emerged in the last month or so. Three foreign currency dealers said a dollar cost 1,800 pounds on Tuesday, weakening from levels of 1,700 and 1,740 cited on Monday.
The official pegged rate is 1,507.5 pounds to the dollar.
“Even if the protesters leave the streets the real problem facing them is what they are going to do with the devaluation of the pound,” said Toufic Gaspard, an economist who has worked as an adviser to the IMF and to the Lebanese finance minister.
“A very large majority of the Lebanese income is in the Lebanese pound, their savings are in the Lebanese pound and their pension is in Lebanese, and it is certain it has already started to devalue,” he said.
People Schiff Refuses to Call for Testimony on the Ukraine Case
With the newly drafted rules that the Pelosi office published to set-up the vote for a ‘formal’ impeachment inquiry sets out that the Republicans can only make requests for witnesses yet Congressman Schiff and those on the majority in the HPSCI can refuse. Swell huh? Then there is the matter that Schiff is quite selective with those he wants to testify omitting so many others with regard to UkraineGate.
This is a long very complicated affair so to boil it down, members of Congress know full well the money-laundering and even cases of murder when it comes to Ukraine and you should have a sense of it as well.
During the Robert Mueller Russian collusion investigation, there were several lawyers and FBI money-laundering experts where you can bet much of this information came across their desks. You must also understand that any sitting president and in this case President Trump just cannot deliver taxpayer dollars in the form of foreign aid to countries teeming in corruption without affecting diplomatic policy and asking for cooperation to root out corruption. Perhaps some of the Schiff witnesses that have provided testimony including LTC. Alexander Vindman should rethink some of this actions and conclusions with regard to Trump’s interactions with matters dealing with Ukraine and China and countless other countries.
As an example of the complications that Congressman Schiff and his committee are ignoring include at least two Ukrainian oligarchs that essentially stole an estimated $5.5 billion from Ukraine, Ihor Kolominsky and Gennady Bogolyubov. He is also ignoring seeking the testimony of Congresswoman Debbie Jessika Mucarsel-Powell. She represents the Florida 26th District and prior to that she was a volunteer for John Kerry’s presidential campaign and then later the Obama presidential campaign. Debbie’s husband, Robert Powell was paid $700,000 is on retainer as an attorney for Ukrainian Oligarch Ihor Kolominsky’s companies. Daily Beast reported in part last year: “Kolomoisky, who sicced his own private army on the Russians after they invaded eastern Ukraine, has been accused of sponsoring contract killings.” Swell client there Robert.
The matter of the corruption with regard to Ukraine extends quite beyond the Bidens and Burisma. In fact it goes far past just a few million dollars, in fact the numbers really exceed 6 billion. More on that later.
Corruption in Ukraine should be measured in not years but rather decades. The corruption does not stay within Ukraine but spreads to Cyprus, the United Kingdom and even all the way to Delaware and Ohio.
On January 16, the National Bank of Ukraine (NBU) published key findings from a report by Kroll that backed allegations of large-scale fraud at PrivatBank, which was taken over by the state in December 2016. These include claims by employees that the bank acted as a “vacuum cleaner”, with business development geared towards attracting deposits that were then dispersed as loans to companies related to the bank’s owners, Igor Kolomoisky and Gennadiy Bogolyubov. According to Kroll, a “loan recycling scheme” was devised to conceal the fraud, whereby new loans were continually issued to new related parties to repay the principal and interest on older loans. Multiple internal transactions within the Privat group, including between the Ukrainian operation and units in Cyprus and Latvia, were also reportedly used to disguise fund flows.
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Prior to this, in fact in 2007 and 2008, the US has been active in Ukraine for some time. In 2007, the firm Vanco won a contract to extract gas from the Black Sea, a deal that was annulled by Tymoshenko after the firm passed on the rights to another company that included eastern Ukrainian and Russian business interests.Yanukovych’s government worked hard to win over US and multinational firms for oil and gas extraction in Ukraine. Kyiv signed a contract with the US-based Chevron at the end of 2013 to extract shale gas in the west of the country. Another deal with the energy giant ExxonMobil – for gas in the Black Sea area – was abandoned following opposition protests.
But the news about the appointment of Hunter Biden has sparked allegations of nepotism – not least because it was revealed just a few weeks after his father’s visit to Kyiv on April 22. Neither Burisma or the US State Department responded to DW’s requests for comment. White House spokesman Jay Carney would say only that Hunter Biden was a private citizen and that his job had no impact on US policy. Ukrainian media reports about Burisma reveal an impenetrable web of companies, most of which are registered in Cyprus. One name, Mykola Slotshevski, appears more than once. The 47-year-old is thought to have been the original owner of the company – at least until recently.
Now Schiff compelled Rudy Giuliani to preserve all documents. Others named in the Schiff schedule include: Igor Framan, Lev Parnas, Joseph di Genova, Victoria Toensing, Hunter Biden, Burisma Holdings Ltd., Joseph Biden, the Democrat National Committee and even Hillary Clinton. This had to be just a gesture as none of them have been called for testimony.
What does Congress know? Plenty. Back in September, there was some interesting floor presentations on key Ukraine corruption items. Reference the congressional record from September 25, 2019, pages 4 and 5. Ukraine corruption reached Delaware and Ohio, beyond our congresswoman in Miami.
Will America see any real consequence of some of these people anytime soon? Hardly. In case you want to know why, we have to get somewhat technical and in fact we may have to wait on the UK to finish their own legal process prosecuting all things Ihor Kolomoisky and this banking scam involving PrivatBank where that pesky $6 billion went missing. By the way, that bank had to be nationalized by Ukraine in an effort to stabilize and recover some of the monies.
So if you do want to get into the weeds, read on. Courtesy of Kyiv Post.
Ihor Kolomoisky is a Ukrainian oligarch and the former governor of Dnipropetrovsk Oblast. He owns media, steelmaking, ferroalloy, oil and gas assets, as well as luxury real estate, water terminals, and airplanes. All of these assets are part of the informal Privat business group controlled by him and business partner, Gennadiy Bogolyubov. Due to ongoing court cases, the assets are now partially frozen.
However, the freeze was imposed only on those assets directly registered to the billionaire or involved in an a series of alleged schemes to withdraw $5.5 billion dollars from PrivatBank, the country’s largest financial institution.
Other Kolomoisky assets are hidden in offshore or registered on trusted individuals.
Law enforcement agencies aren’t the only ones who want to see the ownership structures of Kolomoisky’s companies. His former business partners are also curious.
Businessman Vadym Shulman has been pursuing Kolomoisky in court since 2015. Earlier, in 2014, another oligarch, Victor Pinchuk, engaged in litigation with Kolomoisky and accused him not only of appropriating his business, but even of murder.
Shulman and Pinchuk are demanding that the ownership structure of the long list of companies registered in offshore jurisdictions be disclosed. These companies own real estate, steel and ferroalloy plants in the United States and Georgia.
None of these companies is directly registered to Kolomoisky. But all of them have common managers, lawyers, and even addresses. According to both businessmen’s lawsuits, they are all controlled by Kolomoisky.
The same group of managers run not only these companies, but also several groups of firms involved in the PrivatBank case.
Panikos Symeou is the managing partner of the Cypriot law firm Symeou & Konnaris LLC. According to its website, this company highly values privacy and trust.
Fugitive Ukrainian businessmen like oligarch Serhiy Kurchenko and former National Bank head Serhiy Arbuzov apparently also appreciate these qualities. Panikos Symeou was the head of their Cypriot firm Sabulong Trading, LTD.
In 2017, this company was among the offshore companies that the Prosecutor General’s Office of Ukraine confiscated $1.3 billion from. They had been stolen from the country by the criminal organization created by ousted former Ukrainian President Viktor Yanukovych.
Ihor Kolomoisky entrusts Panikos Symeou with a much wider list of assets — for example, media, steel factories, tire production companies and water terminals.
Symeou’s role is very clear in the ownership structure of Dnipropetrovsk television channel Pryvat TV Dnipro (Channel 9). Symeou is the trusted individual through whom Kolomoisky owns the channel.
The ownership structure of Pryvat TV Dnipro, LLC (Channel 9). (Nadiya Burdey/Anti-Corruption Action Center)
Steel business in the US
Panikos Symeou also has a clear role in the ownership structure of steel factory Warren Steel Holdings LLC in the state of Ohio. The company is nominally registered to the offshore firm Halliwel Assets, Inc in the British Virgin Islands. But, in 2015, one of owners of the factory disclosed the names of all its beneficiaries in court.
According to case materials, the factory belongs to three Ukrainian businessmen: Vadym Shulman, Bogolyubov and Kolomoisky. The latter controls the factory through Symeou.
Shulman initiated that court case. In 2001, he bought the derelict factory and relaunched it. Then, in 2006, Bogolyubov and Kolomoisky became its co-owners.
In 2012, Schulman said he began to suspect his partners of fraud. During his own investigation, he discovered that Warren Steel had concluded loan agreements and sales contracts with other companies controlled by Kolomoisky and Bogolyubov on conditions that were unprofitable for the factory.
According to Shulman, his partners burdened the factory with debts to their own companies in order to receive full control over the assets of Warren Steel.
Shulman’s hypothesis was confirmed in August 2014 when Kolomoisky’s representative, Panikos Symeou, agreed to another $25-million loan for Warren Steel Holdings from the company Optima Acquisitions, LLC. That company was also controlled by Kolomoisky, Shulman said. The media repeatedly reported this without providing any evidence.
In 2015, Shulman filed suit against Warren Steel Holdings, LLC, Panikos Symeou, the company Halliwel Assets, Inc and the president of the Warren Steel factory Mordechai Korf.
TRUSTED PERSON № 2: Mordechai Korf
Mordechai Korf is Ihor Kolomoisky’s American business partner and the director of his multiple steel and manganese enterprises in the United States. In particular, Korf was not only the president of the Warren Steel factory, but also the co-owner of Optima Acquisitions LLC, which gave loans to the factory.
Optima Acquisitions is an investment company registered in Delaware, a state that does not disclose firms’ beneficiaries. Korf has run this company since 2008. Optima Acquisition also owns another American company, Optima Specialty Steel, Inc., which owns several steel factories in various U.S. states.
Journalists have previously tied the name Kolomoisky to the Optima group of companies, but this connection was only confirmed during Optima Specialty Steel’s bankruptcy case. According to case materials, Korf, Kolomoisky and Bogolyubov each owned 33 percent of Optima Acquisitions LLC in 2017.
The connections of Ihor Kolomoisky and Mordechai Korf. (Nadiya Burdey/Anti-Corruption Action Center)
At the end of 2017, Optima Specialty Steel completed its plan of reorganization (bankruptcy) and was rebranded as Specialty Steel Works, Inc. The corporate agent was changed as well as the entire leadership of the company.
In an official press release, the company stated that it would continue to manufacture and sell steel products through its four wholly-owned subsidiaries: Michigan Seamless Tube & Pipe, the Niagara LaSalle Corporation, the Corey Steel Company and Kentucky Electric Steel. Each of these companies owns a factory in the United States.
Michigan Seamless Tube & Pipe predictably owns a factory located in Michigan. The company manufactures seamless cold-drawn pipes for the aerospace, mining, construction, automotive and agricultural industries.
The Niagara LaSalle Corporation owns a factory that manufactures steel parts for automotive, construction, and agricultural machinery in Indiana.
The Corey Steel Company’s factory is located in Cicero, Illinois. It manufactures steel bars.
At the end of 2018, another American company, Steel Dynamics, Inc., acquired Kentucky Electric Steel.
Kolomoisky’s tires
In Ukraine, the name Panikos Symeou is not only connected with the business structures of Kurchenko and Kolomoisky’s Dnipro television channel. The Cypriot is also the co-owner of a Ukrainian plant for producing oversized tires through the company Manita Investments Limited.
The beneficiary controller of the tire plant is Dnipro resident Anna Yesipova. One hundred percent of the plant’s shares is the Cypriot company Manita. It, in turn, is owned by another Cypriot company Sykon Secretarial Limited. Fifty percent of the latter belongs to Panikos Symeou.
The Ukrainian Factory of Oversized Tires and a Romanian factory operate under the same brand name and have one website. An excerpt from the State Register of Romania contains the address of company Euro Tyres Manufacturing SRL’s website: www.eurotire.net. The same website also contains the address of the Ukrainian branch, the Ukrainian Factory of Oversized Tires, that owns factory premises.
Therefore, according to the Eurotire website, the factory is part of a large international corporation which manufactures oversized tires for Eurotire’s mining equipment. The representative offices of this company are located in the United States, Kazakhstan, Indonesia, the Philippines, Japan, Ukraine and Russia. The factories that manufacture such tires are only located in Ukraine and Romania.
A screenshot from the EuroTire YouTube channel showing the countries where the company operates. (Youtube/Eurotire)
In particular, the corporation supplied tires for the company Ferrexpo PLC in Ukraine, which is controlled by Ukrainian dollar billionaire Kostyantyn Zhevago. Ferrexpo PLC owns the Ukrainian Poltava Mining and Processing Plant OJSC, which mines iron ore.
EuroTire’s advertising video states the company cooperates with Ferrexpo PLC.
According to a report published on the Euro Tyres website, more than $300 million were invested in this factory in 2007.
As of March 15, 2019 the owner of the factory is the Romanian company Euro Tyres Manufacturing SRL. This company belongs to two other offshore companies: EuroTyre S.A from the British Virgin Islands and the American Euro Tyres Corporation.
But Panikos Symeou is not the only person who ties Kolomoisky to the international Eurotire corporation. There are also two other links. One of them is the oligarch’s business partner, Uri Laber.
TRUSTED PERSON №3: Uriel Tzvi Laber
Uriel Tzvi Laber is an American who has been actively developing business in Ukraine since the 1990s. Laber is especially interested in oil. During 1997-1999, he founded two fuel companies, Mavex LLC and Petroleum-Invest, LLC.
And, in 2010, Laber became a member of the Supervisory Board of Ukrnafta PJSC. As of March 11, 2019, he still holds this position. Laber is also the director of the American company Optima International of Miami, Inc. According to Bloomberg, this company manufactures tires and is s subsidiary of CB PrivatBank PJSC.
And, of course, Laber himself is director of the Eurotire group of companies.
The connections of Ihor Kolomoisky and Uri Laber. (Nadiya Burdey/Anti-Corruption Action Center)
The connections between Eurotire and Kolomoisky don’t stop there. The Ukrainian and offshore Eurotire companies are involved in PrivatBank-related cases.
As of 2019, the Ukrainian plant for producing over-sized tires is the subject of criminal proceeding by the National Anti-Corruption Bureau of Ukraine over the embezzlement of money from CB Privatbank PJSC, allegedly committed by the management and owners of a substantial part of the bank. Prior to the bank’s nationalization in 2016, one of its co-owners was Igor Kolomoisky.
The Ukrainian plant for producing over-sized tires received a loan in the amount of several million dollars from PrivatBank and did not return the money. When the National Bank uncovered problems inside PrivatBank and Kolomoisky committed to restructure its loan portfolio, employees of the bank transferred the debt from 193 existing companies to non-operating, newly-created companies, which did not have sufficient funds to service the loans. In particular, the debts of actually existing assets — like the the oversized tire plant, were transferred to a newly-created company.
Another offshore company, British Virgin Islands-registered Eurotyre S.A., which owns 99 percent of the factory in Romania, is connected to another embezzlement scheme
According to case materials, PrivatBank officials and owners created a criminal organization and, in 2008-2015, withdrew Hr 12,5 billion ($478 million) in the form of loans to 15 Ukrainian companies. Instead of mortgages, these companies transferred contracts for paid goods to the bank.
So in 2014, Ukrainian company Mondial, LLC concluded an agreement with the non-resident Eurotyre S.A. for the purchase of 21,000 tons of natural rubber for $77 million. This contract was created in the form of a mortgage which Mondial transferred to PrivatBank when it received the loan. Therefore, the company Eurotyre S.A. is obliged to transfer rubber worth $77 million to the bank.
In February 2019, the Pechersk District Court of Kyiv granted the Prosecutor General’s Office access to the contract and a number of other documents located at the office of Eurotyre S.A (Vanterpool Plaza, P.O. Box 873, Wickhams Cay I Road, Road Town, Tortola, British Virgin Islands).
The court granted access to documents in criminal proceeding No. 42017000000001823 as of June 6, 2017 “on the fact of creating a criminal organization, as well as operating such an organization and participation in it in order to obtain the cash funds of CB PrivatBank PJSC in especially large volumes during 2008-2016 by former officials of CB PrivatBank PJSC.”
The court’s decision states that former PrivatBank officials involved “owners and managers of a number of business entities, as well as representatives and final beneficiaries of a number of foreign companies that are connected to the bank through individuals” in order to bring the bank to insolvency.
Kolomoisky’s silico-manganese industry
Kolomoisky’s partners Korf and Laber also operate the oligarch’s ferroalloy business in the U.S. and Georgia.
In 2015, Ukrainian oligarch Viktor Pinchuk pursued Ihor Kolomoisky in the High Court of London.
Pinchuk stated that, in the mid-2000s, he gave Kolomoisky and Bogolyubov money for the purchase of one of the largest iron ore mining companies in Ukraine. But he received neither the company, nor money from them. Pinchuk estimated the profit lost during all these years at $2 billion.
But in January 2016, a few days before court hearing, Pinchuk, Kolomoisky and Bogolyubov reached a peace deal: Kolomoisky pledged to give part of the money from the ferroalloy business to Pinchuk.
The ferroalloy holding includes the Nikopol, Zaporizhzhya and Stakhaniv ferroalloy factories and the Marganets and Ordzhonikidze mining and concentrating combines in Dnipropetrovsk region. In fact, none of these Ukrainian ferroalloy enterprises belong to either Pinchuk or Kolomoisky.
In 2016, the United States International Trade Commission (USITC) published a presentation on the import of silico-manganese. The report also contains a list of Ukrainian ferroalloy factories. According to the Commission, these companies are controlled by Kolomoisky and Bogolyubov. The report also contains a list of the oligarchs’ other ferroalloy assets located in the United States, Georgia and Australia.
A slide from the 2016 report by the United States International Trade Commission (USITC).
Viktor Pinchuk filed an appeal to a Florida court with a request to disclose the ownership property ownership of Georgian American Alloys, Inc. (Delaware), CC Metals and Alloys, LLC (Delaware), Felman Production, LLC (Delaware), and Felman Trading, Inc. (New Jersey). Although these companies are formally registered in offshore jurisdictions and, accordingly, the companies’ owners are not visible, the directors of all these companies were and remain Kolomoisky’s partners Korf and Laber.
Another manager of the companies Felman Production, LLC, Felman Trading, Inc., and the Euro Tyres Corporation is Robert Powell, the husband of Florida Democratic Representative Debbie Mucarsel-Powell.
In the November 2018 midterm election, Debbie Powell won her seat in the U.S. House of Representatives. That same year, the The Miami Herald reported that the Democrat’s husband had been working as the general lawyer in companies controlled by Ihor Kolomoisky for over 10 years. Robert Powell has earned $695,000 while working for these companies in the past two years.
- “I have never worked for, represented…or received any payments from Kolomoisky,” Powell stated during his wife’s campaign.
Mordechai Korf confirmed the statement. He said that Powell concluded his contracts and that he did not have any direct relationship with Kolomoisky. According to Korf, Powell left the company in 2017.
The Democrat’s husband submitted companies Felman Trading and Robert Powell PA as the source of his income in his latest financial report in 2017.
However, according to Florida’s official register, he signs reports on behalf of Felman Production, LLC even in 2019.
Symeou, Privat, and water terminals
Panikos Symeou and Uriel Laber’s entanglements don’t end with factories and the media. They are also tied to Ukrainian water terminals.
In an interview with the Ekonomichna Pravda news site, Igor Kolomoisky mentioned the Borivazh water terminal a few days before the second round of presidential election. The oligarh stated that former national bank chief Valeriya Gontareva was interested in this asset.
The head of the National Bank allegedly wanted to purchase the terminal for Hr 100 million ($3.8 million) and resell it for Hr 250 million ($9.5 million). That is why, Kolomoisky claims, she conducted the nationalization of Privatbank without any formal grounds. That was a violation of his rights, he alleges.
The American corporate investigations firm Kroll, which looked into PrivatBank before nationalization, has effectively refuted this claim. But in this context, the very mention of the terminal is interesting: it has never formally belonged to the oligarch.
The company Borivazh
According to case materials, the property of three companies — the Black Sea Fuel Terminal, the Illichivsk Sea Fishing Port and Borivazh — was re-registered at an underestimated value to three other controlled companies: Optima Trade, Agroterminal Logistic and Dar Torg.
The founders of Dar Torg are Cypriots Panikos Simeou and his partner Christakis Konnaris.
And wasn’t complete strangers who re-registered the property of all three terminals, which was valued in total at Hr 683 million ($26 million). According to the investigation, Anatoliy Tereshchenko, the 73-year-old head and accountant of Optima Trade, and Volodymyr Kigitov, founder of Black Sea Fuel Terminal PJSC at that time, did the re-registering.
Anatoliy Tereshchenko is no stranger in Kolomoisky’s world. He was officially employed at the company Mavex, which was co-owned by Kolomoisky partner Uriel Tzvi Laber until 2007.
Laber has been a member of the Supervisory Board at Ukrnafta PJSC since 2010. Fifty percent of this enterprise belongs to the state, while the other half is owned offshore and controlled by Kolomoisky.
And, of course, companies from this group — which formally do not belong to Kolomoisky — received hundreds of millions of dollars in loans from PrivatBank when it belonged to the oligarch. Borivazh LLC received more than $120 million. , the money was not returned to the creditor, and the property has already been re-registered to another firm.
Agroterminal Logistic also received a loan. This company has already paid Hr 996 million ($38 million) to the National Bank of Ukraine. But this is only a third of the Hr 3.6 billion ($137.4 million) in debt, according to loan agreement No. 120.
Recently, Ihor Kolomoisky explained that fear motivates him to register all his assets to trusted persons or offshores. He is supposedly afraid to disclose the ownership structures of companies because they could then be appropriated by President Petro Poroshenko. But Kolomoisky started registering businesses in offshores long before Poroshenko’s presidency. He started after 2000, during a period of active privatization.
This publication is the first of an upcoming series of stories on the trusted persons of Ukrainian oligarchs by the pep.org.ua project of the Anti-Corruption Action Center. More information and documents about politically exposed persons and their close associates are available at pep.org.ua.