aside Source Of Cohen’s LLC Financial Data Shared by Michael Avenatti, Reveals Concern Over Missing Data

 

In May 2018, Stormy Daniels’ attorney Michael Avenatti shared with the media, sensitive banking data pertaining to over $4 million dollars which was transferred to the republican President Donald J. Trump’s personal attorney/ fixer/ consigliere’s Essential Consultants LLC which was open for business from October 2017 through January 2018. Of course, everyone has been questioning how did Mr. Avenatti gain access to these bank records which are deemed to be bound by privacy rules.

In the following report, it has been revealed that a government employee risked his/ her well being / job by sharing this data. This was done in response to his/ her discovery that additional suspicious transactions banking records were missing in the government database, an incident that is considered to be highly irregular.

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Here is the rest of the story…

On May 16, 2018, Ronan Farrow of the New Yorker penned the following report, “Missing Files Motivated the Leak of Michael Cohen’s Financial Records” (“A law-enforcement official released the documents after finding that additional suspicious transactions did not appear in a government database.”)

“Last week, several news outlets obtained financial records showing that Michael CohenPresident Trump’s personal attorney, had used a shell company to receive payments from various firms with business before the Trump Administration. In the days since, there has been much speculation about who leaked the confidential documents, and the Treasury Department’s inspector general has launched a probe to find the source. That source, a law-enforcement official, is speaking publicly for the first time, to The New Yorker, to explain the motivation: the official had grown alarmed after being unable to find two important reports on Cohen’s financial activity in a government database. The official, worried that the information was being withheld from law enforcement, released the remaining documents.”Image result for image of suspicious-activity report form

“The payments to Cohen that have emerged in the past week come primarily from a single document, a “suspicious-activity report” filed by First Republic Bank, where Cohen’s shell company, Essential Consultants, L.L.C., maintained an account. The document detailed sums in the hundreds of thousands of dollars paid to Cohen by the pharmaceutical company Novartis, the telecommunications giant A.T. & T., and an investment firm with ties to the Russian oligarch Viktor Vekselberg.”

The report also refers to two previous suspicious-activity reports, or sars, that the bank had filed, which documented even larger flows of questionable money into Cohen’s account. Those two reports detail more than three million dollars in additional transactions—triple the amount in the report released last week. Which individuals or corporations were involved remains a mystery. But, according to the official who leaked the report, these sars were absent from the database maintained by the Treasury Department’s Financial Crimes Enforcement Network, or fincen. The official, who has spent a career in law enforcement, told me, “I have never seen something pulled off the system. . . . “That’s why I came forward.”

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Seven former government officials and other experts familiar with the Treasury Department’s fincen database expressed varying levels of concern about the missing reports. Some speculated that fincen may have restricted access to the reports due to the sensitivity of their content, which they said would be nearly unprecedented. One called the possibility “explosive.” A record-retention policy on fincen’s Web site notes that false documents or those “deemed highly sensitive” and “requiring strict limitations on access” may be transferred out of its master file. Nevertheless, a former prosecutor who spent years working with the fincen database said that she knew of no mechanism for restricting access to sars. She speculated that fincen may have taken the extraordinary step of restricting access “because of the highly sensitive nature of a potential investigation. It may be that someone reached out to fincen to ask to limit disclosure of certain sars related to an investigation, whether it was the special counsel or the Southern District of New York.” (The special counsel, Robert Mueller, is investigating Russian interference in the 2016 Presidential election. The Southern District is investigating Cohen, and the F.B.I. raided his office and hotel room last month.)

“Whatever the explanation for the missing reports, the appearance that some, but not all, had been removed or restricted troubled the official who released the report last week. “Why just those two missing?” the official, who feared that the contents of those two reports might be permanently withheld, said. “That’s what alarms me the most.”

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“Banks are legally mandated to file suspicious-activity reports with the government in order to call attention to activity that resembles money laundering, fraud, and other criminal conduct. These reports are routed to a permanent database maintained by fincen, which can be searched by tens of thousands of law-enforcement and other federal government personnel. The reports are a routine response to any financial activity that appears suspicious. ”

“Cohen set up the First Republic account for Essential Consultants in October, 2016, shortly before the Presidential election, in order to pay the adult-film actress Stephanie Clifford, who performs under the name Stormy Daniels, a hundred and thirty thousand dollars in return for signing a nondisclosure agreement about her alleged affair with Donald Trump. First Republic’s compliance officers later began flagging Cohen’s transactions in the account as possible signs of money laundering. Among other potential violations, the documents cite “suspicion concerning the source of funds,” “suspicious EFT/ wire transfers,” “suspicious use of multiple accounts,” and “transaction with no apparent economic, business, or lawful purpose.”

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“By January of this year, First Republic had filed the three suspicious-activity reports about Cohen’s account. The most recent report—the only one made public so far—examined  Cohen’s transactions from September of 2017 to January of 2018, and included activity totalling almost a million dollars. It alludes to the two previous reports that the official could not find in the fincen database. The first report that the official was unable to locate, which covered almost seven months, appears to have listed a little over a million dollars in activity. The second report that the official was unable to locate, which investigated a three-month period between June and September of 2017, found suspect transfers totalling more than two million dollars.”

“A substantial portion of this money seems to have ended up in Cohen’s personal accounts. Morgan Stanley Smith Barney filed a separate sar showing that, during that same three-month period, Cohen set up two accounts with the firm, into which he deposited three checks from his Essential Consultants account, two in the amount of two hundred and fifty thousand dollars and one in the amount of five hundred and five thousand dollars. Morgan Stanley Smith Barney marked those transactions, which added up to more than a million dollars, as possible signs of “bribery or gratuity” and “suspicious use of third-party transactors (straw-man).”

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“Cohen appears to have misled First Republic repeatedly regarding the purpose of the Essential Consultants account. In paperwork filed with the bank, he said that the company would be devoted to using “his experience in real estate to consult on commercial and residential” deals. Cohen told the bank that his transactions would be modest, and based within the United States. In fact, the compliance officers wrote, “a significant portion of the target account deposits continue to originate from entities that have no apparent connection to real estate or apparent need to engage Cohen as a real estate consultant.” Likewise, “a significant portion of the deposits continues to be derived from foreign entities.” David Murray, a former Treasury official focussed on illicit finance, told me, “There are a ton of red flags here. The pattern of activity has indicators that are inherently suspicious, and the volume and source of funds do not match the account profile that was built when the account was opened.”

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“The report released last week highlights a payment from Cohen’s account to Demeter Direct, Inc. In publicly filed paperwork, Demeter Direct represents itself as a Korean food company. However, a Web site, since taken down, suggested that it was a global consulting firm. After the press began scrutinizing Cohen’s accounts, a man listed as Demeter Direct’s C.E.O., Mark Ko, told CNN that he served as an intermediary and translator in Cohen’s dealings with an aviation firm, majority-owned by South Korea’s government, called Korea Aerospace Industries. According to the First Republic report, the aerospace company paid Cohen a hundred and fifty thousand dollars in November of 2017, the same month President Trump visited South Korea. At the time, the company was lobbying for a controversial multibillion-dollar contract with the U.S. Air Force.”

“The report also shows how Cohen apparently used the Essential Consultants account for personal expenses. He seems to have used it to pay his American Express, A.T. & T., and Mercedes Benz bills, marking account numbers on the memo lines of his checks.”

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VICTOR VEKSELBERG/ PRESIDENT VLADIMIR PUTIN

In many cases, the suspicious-activity reports highlight activity of potential interest to ongoing investigations, including that of the special counsel, Robert Mueller. Bank compliance officers noted eight payments from a company called Columbus Nova to Cohen’s account between January and August of 2017, totalling five hundred thousand dollars. The investigators wrote that Columbus Nova’s biggest client is a company controlled by Viktor Vekselberg, whom they described as “reputed to be a longtime ally of Russian President Vladimir Putin.” The report also points out that Andrew Intrater, Vekselberg’s relative and the C.E.O. of Columbus Nova, donated more than three hundred thousand dollars to Trump-related causes. The report flagged the activity as suspicious “because the CEO’s company transferred substantial funds to the personal attorney of Trump at the same time the CEO reportedly donated substantial funds to Trump’s inauguration fund and joint fundraising committee for Trump’s reelection and the Republican National Committee.”

Other banks also noticed Cohen’s suspicious transactions and filed their own sars about his activity. Some of those show the banks piecing together the reasons for the transactions from news reports, citing articles from publications including the Wall Street Journal  and Vanity Fair about Trump, Russia, and secret election-season payments, including the payment to Clifford. One, filed by City National Bank, follows money paid to Cohen by Elliott Broidy, at the time the deputy finance chairman for the Republican National Committee. The report notes, “Broidy also owns a private security company, Circinus, which provides services to the U.S. and other governments. The company has hundreds of millions of dollars in contracts with the U.A.E.”

“Broidy has said that Cohen and another lawyer, Keith Davidson, worked out a deal in which Broidy would pay $1.6 million to a former Playboy model he had impregnated. Broidy appears to have paid both lawyers for arranging the deal. The City National report shows that Broidy funnelled the payments  through Real Estate Attorneys’ Group, a legal corporation. Broidy seems to have paid Davidson two hundred thousand dollars, and to have sent three payments, of $62,500 each, to Cohen—one to the Essential Consultants account and two to the account of Michael D. Cohen and Associates.”

“A representative for Broidy said that this description of the payments was “not correct.”  The representative added, “Mr. Broidy did not pay Mr. Davidson.” However, the City National report shows that on November 30, 2017, a wire of two hundred thousand dollars was received by the Real Estate Attorneys’ Group from Broidy. Then, on December 5, 2017, two hundred thousand dollars were transferred from Real Estate Attorneys’ Group to an account belonging to Keith M. Davidson and Associates.”

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“Michael Avenatti, an attorney representing Clifford, who has released summaries of Cohen’s transactions on social media, said, “The Treasury Department should release all of the sars immediately to the American public.””

“Suspicious-activity reports are kept strictly confidential, as a matter of law. “sars are secret, to protect the government and to protect financial institutions,” the former prosecutor told me.”

Link to entire report: Missing Files Motivated the Leak of Michael Cohen’s Financial Records

2 comments

  1. Gronda, this explains a lot. With a man who is as dishonorable as the President is, the longer he remains in office, the more corrupt and regal-like things will become. As you have reported, this is far more than the Russia thing. He is compromised, but is involved with pay for play. He is enriching himself as President. Keith

    Liked by 1 person

    • Dear Keith,

      How sad that our country is being run like a banana republic where foreign countries have to pay bribes to have policies enacted in its favor.

      He is a very angry, cruel, selfish man where he cares more about financially enriching his own coffers than acting in the best interests of the US national security priorities.

      Hugs, Gronda

      Like

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