Special counsel Robert Mueller, who is spearheading the FBI’s investigation into whether President Donald Trump’s campaign colluded with Moscow during the 2016 election, has added yet another prosecutor to his team who specialises in money laundering cases, Politico reported on Friday.
Before joining Mueller’s team, attorney Kyle Freeny was leading the Department of Justice’s charge to seize profits from the movie, “The Wolf of Wall Street,” amidst allegations that Riza Aziz, a co-founder of the film’s production company, Red Granite Pictures, used $US64 million worth of stolen funds from the Malaysian government to bankroll the movie. Aziz is the stepson of Malaysian Prime Minister Najib Razak, according to Law360.
In July, the DOJ filed several motions in court seeking the return of $US1 billion in assets that it alleges was laundered through the US and used to buy big-ticket items, and lawyers representing Red Granite Pictures said in a court filing Friday that they’d reached a settlement with prosecutors.
The dispute is currently the DOJ’s most high-profile money-laundering case, and Freeny was one of four attorneys representing the US government before she left the case in June.
Politico noted in its report that there appear to be some similarities between Freeny’s work on the Malaysian money-laundering case and certain aspects of Mueller’s investigation.
The “Wolf of Wall Street” case is being investigated as part of the DOJ’s Kleptocracy Asset Recovery Initiative, a program created in 2010 to address public corruption. The initiative is led by seasoned DOJ prosecutors as well as members of the FBI and other law-enforcement agencies.
In addition to the Malaysian money-laundering case, the program is also looking into overseas asset transfers made by Ukrainian officials, including former President Viktor Yanukovych.
Yanukovych is a prominent member of Ukraine’s pro-Russia Party of Regions and is closely tied to the Kremlin. Yanukovych also used to be allied with former Trump campaign chairman, Paul Manafort, when Manafort served as his consultant. Manafort is widely credited with helping Yanukovych win the presidency in 2010. After being ousted in 2014 following widespread protests against his Russia-friendly positions, Yanukovych fled to Russia and is now living under the protection of the Kremlin.
Mueller’s investigation into Manafort’s work focuses primarily on his ties to the Party of Regions, which reportedly designated Manafort $US12.7 million in undisclosed cash payments. Manafort’s firm belatedly disclosed in a June filing that it had received about $US17 million from the Party of Regions between 2012 and 2014.
Manafort has consistently denied any wrongdoing.
Mueller has so far given several signs that he’s homing in on Manafort as part of the Russia investigation. In addition to probing the former Trump campaign chairman’s relationship with the Party of Regions, Mueller has also teamed up with New York Attorney General Eric Schneiderman as he examines Manafort’s business dealings in the state of New York.
Freeny’s expertise in prosecuting money-laundering cases could prove handy for the Mueller-Schneiderman investigation into Manafort’s murky finances.
He has previously used shell companies to make cash purchases of real estate, then taken out loans against them. Though the practice is not illegal in itself, it represents a pattern that the US Financial Crimes Enforcement Network (Fincen) believes indicates possible money laundering.
“It is apparent in our data that essentially criminals are parking dirty money, criminal proceeds, in luxury real estate, as a place to hide it, as well as place to invest it, as well as a place to enjoy it,” Jennifer Shasky Calvery, the former director of Fincen, told Quartz.
Manafort bought four properties in New York City between 2006 and 2013 using shell companies and paid the full amount due for each property. Later, between 2012 and 2017, NBC News reported that Manafort borrowed $US13 million against those properties. $US6.5 million out of that amount came this year from a bank run by a Trump campaign economic adviser.
Though the purchases were initially made by shell companies, a WNYC investigation found that they were later transferred into Manafort’s name without any payment.
Given that the majority of Manafort’s real estate transactions reported thus far took place in New York, they could fall within Schneiderman’s jurisdiction and may constitute the basis for criminal proceedings against Manafort in the state.
Although Trump could theoretically pardon close associates indicted on federal charges, his executive authority does not extend to state crimes, and legal analysts have speculated that Mueller is turning up the heat on Manafort to coerce his cooperation in the Russia investigation.
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